In 2016, when the Lee Company learned that its estimate of bad debt expense in 2014 was 5% too high, the accounting rules required it to go back and change the 2014 financial reports.

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Accounting principles generally require that errors discovered in a subsequent period be corrected in the period they are discovered, rather than by amending previously issued financial statements. The correction is typically reflected in the current period's financial statements.

In 2016, When the Lee Company Learned That Its Estimate