Financial Restatement Paper

The stock market is a risky game that investors often play to make money. A smart investor will research and compare different companies to determine if the company if profitable before investing in a particular company. Investors rely on a company’s financial statements to help determine whether or not a company is a good investment. Occasionally because of errors in accounting principles, a company has to restates its financial statements.
In October 2008,, Inc. restated its financial reports from for the fiscal year ended December 31, 2003 to September 30, 2008 to correct certain customer refund and credit errors. From the Company’s inception through 2007, the company recorded revenue based on product ship date. determined that it should not record revenue until product delivery date because risk of loss transfers to the customer upon delivery and acceptance (Securities and Exchange Commission, 2008). The company had an internal control problem. issued a statement saying a new computer system was not operating correctly to unsure that all refunds and credits issued to customers and gift cards issued to customers were completely and accurately recorded in the correct accounts. This error caused the revenue and returns expense accounts to be misstated. In the last quarter of 20008, overpaid a vendor and when the overpayment was returned in 2009, recorded overpayment as income.
Subsequently on January 29, 2010, yet again had to restate its previously issued financial statements for the fiscal year ended December 31, 2008 (including the interim periods within that fiscal year), and the quarterly periods ended March 31, 2009, June 30, 2009 and September 30, 2009 (Antar, 2010). incorrectly amortized the expense related to restricted stock units based on the actual three-year vesting schedule rather than a three-year straight line amortization and applied an...