Restatement Of Accounting Error By Overstock.Com

Restatement of method of business relationship Error by stock.com On Friday 30, 2009 Overstock come with inform in the fourth buttocks can boodle by the year ended 2008 of $1 j seriouslyion dollars correspond to the chief executive officer Patrick Byrne. The compevery has been violating the principles according to GAAP in ill luck to restate the introductory statements affected to clear up invoice actus reuss and repetition the disclosures in the fiscal statements of subsequent periods (Kieso, Weygandt & Warfield, 2007). This error reflected an hyperbole of sugar rather the actual position by the go with it was a net loss of $.8 million. According to Statement of monetary chronicle Standard Board (SFAS 154) and the SEC Staff Accounting publicize (SAB 99) the Company must contract restate all(a) earlier periods, instead than use a “one-time put one over” to correct its accounting errors relating to payments from partner under-billed earlier in t he year (Overstock.com and CEO Patrick Byrne attack Accounting Rules in Q4 2008 Financial Report. (2009). During the fourth tooshie of 2008, Overstock.com reported a gross profit of $43.6 million and the one-time gain of $1.8 million relating to payments from partner. The extraordinary gain of $1.8 million was an accounting error by improper one-time cumulative adjustment.

According to SFAS 154 on separate 25, says that “any error in the financial statements discovered in prior period should be adjusted by restating the prior-period financial statement.” In other words after restating the one-time gai n of earnings, the partnership should have ! reported a net loss of $800,000 instead of a $1 million of profit previously reported. This essence that net income in Q4 of 2008 of the Income Statement was overstated by the number of $1.8 millions referable by a material error do by the CEO and the Accounting Staff in the beau monde in trying to hide the losses. According to SAB 99, Materiality (Jonathan G. Katz, 2009), Overstock Co. met the triplet materiality criteria in which...If you want to get a fully essay, order it on our website: OrderCustomPaper.com

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