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IS THE CONTROLLER ACTING ETHICALLY?? RESPOND with at least 150 words. The controller of global systems...

IS THE CONTROLLER ACTING ETHICALLY?? RESPOND with at least 150 words.

The controller of global systems has developed a new costing system that traces the cost of activities to products. The new system is able to measure post manufacturing activities, such as selling, promotional and distribution activites, and allocate these activities to products in a manner that provides more of a complete view of the products costs. This system produces better strategic information about the relative profitability of product lines.

In the course of implementing the new costing system, the controller realized that the company's current period GAAP net income would increase significantly if the new product cost information was used for inventory valuation on the financial statements. The controller has been under intense pressure to improve the company's net income and this would be an easy and effective way for him to help meet the company's short term net income goals. As a result she has decided to use the new costing system to determine GAAP net income.

IS THE CONTROLLER ACTING ETHICALLY?? RESPOND with at least 150 words.

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