Conflicting Accounting Principles

[Name of the Author]

[Name of College]

ABSTRACT

Ethics in business on a wider aspect, deals with business activities in relative to what is ethically right and what is not. Being ethical in the business means fulfilling all the required requirements in such a manner that the company could highlight a true picture to its investors and stakeholders. The main focus of this assignment is on the accounting principles and their applications in the not for profit organizations. On the other hand recommendations and affects of non compliance are also discussed in the business.

Conflicting Accounting Principles

Introduction

For this accounting assignment I have selected a technology base retail company with a large range of high quality products, and personified customer service named as (Overstock). The company 'overstock' is a trading company and is also listed in NASDAQ. The company head quarter is situated in Salt Lake City. The company is maintaining (GAAP) principles to comply the accounting records.

During the quarters of October 2008 an accounting fraud has been detected in the company accounting statements.

Background of the Conflict

In order to maintain the accounting records the company restates all its records due the reason that there are a number of errors in customer recording of customer refunds and credits in the accounting records of FY 2003 to FY 2008. But after analysis of the past accounting records it becomes crystal clear that these errors are not recorded in the statements and hence are not adjusted. These under billed offsetting costs and reimbursements of the customers have already been earned from its partners in the same accounting period. It can be stated as, if the company is actually complying with the principles of (GAAP) it needs to go back and amend the statement as with corrected figures so that, the accounting records demonstrate the real ...