Reference no: EM1326464

Mike Singletary, president of Singletary industries, wishes to issue a press release to bolster his company's image and maybe even its stock price which has been gradually falling. As controller, you have been asked to provide a list of twenty financial ratios along with some other operating statistics relative to singletary industries first quarter financial and operations. Two days after you provide the ratios and data requested, Curtis Conway the public relations director of singleatary, asks you to prove the accuracy of the financial and operating data contained in the press release written by the president and edited by Curtis. In the news release, the president highlights the sales increase of 25% over last years first quarter and the positive change in the current ratio from 1.5:1 last year to 3:1 this year. He also emphasizes that production was up 50% over the prior year's first quarter. You note that the press release contains only positive or improved ratios and none of the negative or deteriorated ratios. For instance, no mention is made that the debt to total assets ratio has increased from 35% to 55%, that inventories are up 89%, and that while the current ratio improved, the acid test ratio fell from 1:1 to .5:1. Nor is there any mention that the reported profit fro the quarter would have been a loss had not the estimated lives of singletary's plant and machinery been increased by 30%.

Instructions:

a. Who are the stakeholders in this situation?

b. Is there anything unethical in President Singletary's actions?

c. Should you as the controller remain silent? Does Curtis have any responsibility?