Sam is an employee in the accounting department and his boss has asked him to copy the worksheet he has prepared for a meeting that afternoon in order to finalize the company’s financial statements for the period. As Sam is copying the worksheet, he notices that a sale on account has not been correctly recorded. The amount has been transposed from the ledger – it was recorded as $54,000 instead of $45,000. Sam remembers the transaction as the sale was to one of his friends. If Sam says nothing, he will receive a higher bonus because the company pays a bonus to all its employees according to their total sales. The bonus will be very useful as Sam is leaving the company at the end of next week to go on an extended working holiday in Europe.
Required: What would you do if you were Sam?
Submit your answer in “Leave a comment” in this page at the latest of 6th June 2011.
This case study is taken from:
Bazley, M., Hancock , P., Berry, A., and Jarvis, R. 2004. Contemporary Accounting. 5th Edition. Thomson Learning. Australia. Chapter 6, p.141.