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Question: In calculating the allowance for doubtful debts last year (year ended 30 June 2016) the accounts clerk who did the calculation made a big error in his excel spreadsheet and understated the amount significantly. Instead of allowing for 2% sales revenue ($2.5 million last year and $2.9 million estimated for the current year) which is the company's accounting policy, the amount allowed was just 0.02%. How should we treat this in the current year's financial statements? I have said that the board could decide on how we deal with this but unfortunately, we are equally divided and Charade said that as the problem is less than 5% of sales revenue it is not material. The sales director is concerned that his sales figures will be impacted by this. How should we treat this? Can the board just decide?
Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..
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