GB Company had a very bad year in 2011.The controller knew that the company already had a significant loss for the year,so he put the paperwork in his bottom drawer for some of the shipments made in the last two weeks of 2011.As a result,$100,000 of sales were not recorded and the customers weren't billed until 2012.The controller is ________.

Question

Quizplus · Accepted Answer

The controller is recognizing revenue too late, which is not in compliance with generally accepted accounting principles (GAAP). By not recording the sales and billing the customers until 2012, the 2011 financial statements are misstated and do not accurately reflect the company's financial position for the year. This is considered unethical behavior and goes against the principle of transparency in financial reporting.

GB Company Had a Very Bad Year in 2011