(L. OBJ. 6) Making ethical decisions [20—25 min] Lee Reinhardt is the new controller fo...

(L. OBJ. 6) Making ethical decisions [20—25 min]

Lee Reinhardt is the new controller for Night Software, Inc., which develops and sells education software. Shortly before the December 31 fiscal year-end, Robert Tau, the company president, asks Reinhardt how things look for the year-end numbers. He is not happy to learn that earnings growth may be below 15% for the first time in the company’s five-year history. Tau explains that financial analysts have again predicted a 15% earnings growth for the company and that he does not intend to disappoint them. He suggests that Reinhardt talk to the assistant controller, who can explain how the previous controller dealt with such situations. The assistant controller suggests the following strategies:

Requirements

1. Which of these suggested strategies are inconsistent with IMA standards?

2. What should Reinhardt do if Tau insists that she follow all of these suggestions?