Posted: May 17th, 2016

reflect bona-fide liabilities of a substantial amount, until after year-end, at which time it was expected that additional financing could be obtained. How would you handle the situation?

Discussion #6 You are the controller of a privately-held corporation. The company has just created a product that is expected to yield substantial profits in a couple of years. Right now though, the company is experiencing financial difficulties; and because of a lack of working capital, is close to default on a note they have outstanding with the bank. At the end of the most recent fiscal year, the CEO instructed you not to record several invoices as accounts payable, which reflect bona-fide liabilities of a substantial amount, until after year-end, at which time it was expected that additional financing could be obtained. How would you handle the situation?