Timing differences such as bringing forward the recognition of revenues and delaying the recognition of expenses is an example of _______.
A)fraudulent financial reporting
B)performance materiality
C)planning materiality
D)balance sheet benchmarks

Question

Quizplus · Accepted Answer

Bringing forward the recognition of revenues and delaying the recognition of expenses is a common tactic in fraudulent financial reporting, also known as earnings management or manipulation. This can be done to artificially inflate revenue and profit figures, which is unethical and often illegal. The other choices - performance materiality, planning materiality, and balance sheet benchmarks - are not directly related to timing differences in revenue and expense recognition.

Timing Differences Such as Bringing Forward the Recognition of Revenues