72 Revenue Recognition and Ethics. The following article was published in Newsday on February 9, 2009: Call for Probe of Ticket Sales Bruce Springsteen fans were victims of a "classic bait and switch" scam by the nation's largest concert ticket seller, Senator Charles Schumer said yesterday, as he called for a federal investiga- tion into the company, Ticketmaster. Schumer wants the Federal Trade Commission to look into whether the Ticketmaster website withheld the best tickets from the public and then shuttled fans to TicketsNow, a fully owned subsidiary. TicketsNow had the best seats available immediately at sky-high prices-after Springsteen tickets went on sales at 10 a.m. on February 2. A federal investigation would look into whether Ticketmaster was instantly scalping the tick- ets, never giving fans a chance to buy them at face value, Schumer said. Customers who tried to buy tickets originally priced at $95 on Ticketmaster's website were directed to TicketsNow where they were priced at more than $2,000 Since buying TicketsNow in February, Ticketmaster has faced similar criticism for its handling

72 Revenue Recognition and Ethics. The following article was published in Newsday on February 9, 2009: Call for Probe of Ticket Sales Bruce Springsteen fans were victims of a "classic bait and switch" scam by the nation's largest concert ticket seller, Senator Charles Schumer said yesterday, as he called for a federal investiga- tion into the company, Ticketmaster. Schumer wants the Federal Trade Commission to look into whether the Ticketmaster website withheld the best tickets from the public and then shuttled fans to TicketsNow, a fully owned subsidiary. TicketsNow had the best seats available immediately at sky-high prices-after Springsteen tickets went on sales at 10 a.m. on February 2. A federal investigation would look into whether Ticketmaster was instantly scalping the tick- ets, never giving fans a chance to buy them at face value, Schumer said. Customers who tried to buy tickets originally priced at $95 on Ticketmaster's website were directed to TicketsNow where they were priced at more than $2,000 Since buying TicketsNow in February, Ticketmaster has faced similar criticism for its handling

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Chapter8: Subprime Lending Fiasco-ethics Issues

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Revenue Recognition and Ethics. The following article was published in Newsday on February 9, 2009:Call for Probe of Ticket SalesBruce Springsteen fans were victims of a “classic bait and switch” scam by the nation’slargest concert ticket seller, Senator Charles Schumer said yesterday, as he called for afederal investigation into the company, Ticketmaster. Schumer wants the Federal TradeCommission to look into whether the Ticketmaster website withheld the best tickets from thepublic and then shuttled fans to TicketsNow, a fully owned subsidiary. TicketsNow had thebest seats available immediately—at sky-high prices—after Springsteen tickets went on salesat 10 A.M. on February 2.A federal investigation would look into whether Ticketmaster was instantly scalping the tickets,never giving fans a chance to buy them at face value, Schumer said. Customers who tried tobuy tickets originally priced at $95 on Ticketmaster’s website were directed to TicketsNowwhere they were priced at more than…
The auditor worked for this client for years. But before accepting or continuing with the client, What are the reasons the auditor or audit firm should or should not retain this existing client this time around using the information below about the client? What risks could the client, its business, and its environment pose to the auditor or audit firm? The client: Although client cash flows have been stable, the disruption caused by the 2020 global pandemic made it difficult for retail lessors to pay their rent on time. Due to the company's tenant-friendly approach, retail clients were allowed to renegotiate their lease and temporarily pause rent payments between June 2020 and July 2021, shifting those payments to the last 12 months. Most of these leases will expire in the next two years, including all retail companies unable to pay their rent. However, they estimate that they will receive all the lost cash flow from these tenants within a couple of years. Currently, the company is a…
Ethical Considerations. In the process of closing thecompany books, you encounter a problematic transaction. One of the company’s customers was invoicedtwice for the same project materials, resulting in a$1,000 overcharge. You immediately notify the controller, whose response is, “Let it go, it happens often.It’ll probably balance out on some future transaction.”What should you do now?
Impact of Sarbanes–Oxley Act. Your long-time client, Central Office Supply, has beenrapidly expanding, and the board of directors is considering taking the company public.CEO Terry Puckett has heard that costs of operating a public company have increased significantly as a result of the Sarbanes–Oxley Act. Puckett is particularly concerned withreports that audit fees have doubled because of internal control provisions of the act andPCAOB Auditing Standard No. 2201. Puckett has asked you to explain the possible effectson the audit of complying with the requirements of Sarbanes–Oxley.Required:Draft a letter to Puckett outlining the changes in the company’s responsibilities for internal control and changes in the audit due to Sarbanes–Oxley and PCAOB Auditing Standard No. 2201
B. Harper is surfing the Internet and finds a great pair of rollerblades at a really low price, but he has never heard of the company and is concerned that the product he ordered may not be the product he receives. Harper may be more willing to place an order with this company ifa. The website displays the WebTrust seal.b. The company provides its annual report and the report of the independent auditors on its website.c. The company provides a money-back guarantee.d. Only a partial payment is required prior to receiving the product.
The birth of the Internet in the 1990s led to the creation of a new industry of online retailers such as Amazon, Overstock.com, and PCM, Inc. Many of these companies often act as intermediaries between the manufacturer and the customer without ever taking possession of the merchandise sold. Revenue recognition for this type of transaction has been controversial. Assume that Overstock.com sold you a product for $200 that cost $150. The company's profit on the transaction clearly is $50. Should Overstock recognize $200 in revenue and $150 in cost of goods sold (the gross method), or should it recognize only the $50 in gross profit (the net method) as commission revenue? 4. Do you agree with Alphabet's reasoning with respect to choosing whether it reports revenue gross versus net with respect to these advertising services? Indicate "yes" or "no," and explain.
ACCC takes Harvey Norman franchisees to courtABC Updated November 21, 2012, 8:51 amThe competition watchdog is taking 11 Harvey Norman franchisees to the Federal Court for allegedly misrepresenting consumer rights.The ACCC alleges the franchisees of the stores misled and deceived customers by making false claims about warranties and refunds.As part of the action, the ACCC is seeking penalties, declarations, injunctions and costs.It is part of the commission's campaign on consumer guarantees and it says it is investigating other large companies for similar breaches.ACCC chairman Rod Sims said in a statement that consumers had the right to certain remedies when goods were not of acceptable quality or fit for the purpose for which they were sold."These rights cannot be excluded, restricted or modified," he said."For example, if an item purchased breaks down within a short time of being purchased, the consumer may be entitled to a refund or a replacement item."The ACCC says in some cases…
Your long-time client, Central Office Supply, has been rapidly expanding, and the board of directors is considering taking the company public.CEO Terry Puckett has heard that costs of operating a public company have increased significantly as a result of the Sarbanes–Oxley Act. Puckett is particularly concerned with reports that audit fees have doubled because of internal control provisions of the act and PCAOB Auditing Standard No. 2201. Puckett has asked you to explain the possible effects on the audit of complying with the requirements of Sarbanes–Oxley.Required:Draft a letter to Puckett outlining the changes in the company’s responsibilities for internal control and changes in the audit due to Sarbanes–Oxley and PCAOB Auditing Standard No. 2201.
c. Intuit Inc. develops tax preparation software that it sells to its customers for a flat fee. No further Explain when each of the following businesses fulfills the performance obligations implicit in the sales b. Oracle Corp. develops general ledger and other business application software that it sells to its E5-34. a. RealMoney.Com, a division of TheStreet Inc., provides investment advice to customers for an up front fee. It provides these customers with password-protected access to its website, where they 01 Assessing Revenue Recognition Timing and Income Measurem contract and recognizes revenue. Identify any revenue measurement ISsues that could arise can download investment reports. RealMoney has an obligation to provide updates on its they customers. The customer pays an up-front fee for the right to use the software and a monthly its support services. payment is required, and the software cannot be returned, only exchanged if defective. d. Electronic Arts develops and sells…
Ernest and Young cleared Wirecard’s reputation back in 2008 and BaFin, the German financial regulator, continually supports Wirecard. Critics of Wirecard were investigated by BaFin. Suggest course of action (s) to prevent discrepancies in the financial resultsreporting to ensure that such scandal will not arise in the near future. Make sure your answers in paragraph not less than 500 words. Thank you
The auditor worked for this client for years. But before accepting or continuing with the client what factors should the auditor consider looking at the given information below? The client: Although client cash flows have been stable, the disruption caused by the 2020 global pandemic made it difficult for retail lessors to pay their rent on time. Due to the company's tenant-friendly approach, retail clients were allowed to renegotiate their lease and temporarily pause rent payments between June 2020 and July 2021, shifting those payments to the last 12 months. Most of these leases will expire in the next two years, including all retail companies unable to pay their rent. However, they estimate that they will receive all the lost cash flow from these tenants within a couple of years. Currently, the company is a privately held REIT that hopes to go public in the next six months. It follows Generally Accepted Accounting Principles (GAAP) and has a strong internal audit department. As a…
15. Your client, HillTop, is a retailer of women's clothing. It has increased sales during the holiday season by advertising gift cards for in-store and online use. HillTop has found that gift card holders who come into the store tend to purchase goods that total more than the amount of the gift card. Further, about one-third of the gift cards never are redeemed, thereby yielding cash to the company without a reduction of inventory. What are the tax issues confronting HillTop related to the gift cards?