Auditing and Accounting Cases: Investigating Issues of Fraud and Professional Ethics 3rd Edition by Jay Thibodeau,Deborah Freier

Exercise 3

As discussed in the case, during both the 1996 and 1997 audit, Phillip Harlow allegedly discovered a number of different accounting entries made by Sunbeam that were not compliant with Generally Accepted Accounting Principles (GAAP). Speculate about how Harlow might have explained his decision not to require Sunbeam to correct these alleged misstatements in the audit working papers.