Option #2: Case Analysis: Coupon Offer

Companies occasionally offer a coupon or warranty offer to increase sales. Management must estimate the redemption rate and record and expense the corresponding liability. A manager could intentionally under estimate the redemption rate. The increased sales would be recorded in the current period to meet a sales goal, but the redemption cost would not be recorded until the following period.

Could this situation happen to a company with a good control environment? Describe any steps a company could take to prevent such abuse. Who might be harmed? Do you consider this example to be management fraud or employee fraud? Describe how it fits the definition of your choice.

Your paper should meet the following requirements:

• Three to four pages (750-1000 words) in length (not including cover and reference pages)
• Formatted according to APA guidelines as explained in the CSU-Global Guide to Writing and APA(subheadings, 1“ margins, and double spacing)
• Supported by three credible, academic sources in addition to the textbook. Academic sources should be located using the CSU-Global library. All paraphrased and quoted material must be properly cited per APA guidelines; only cited sources should be listed on the reference page.

Write clearly and logically, as you will be graded on content, analysis, and your adherence to the tenets of good academic writing, which should be succinct where possible while also exploring the topics appropriately. Scholarly sources should be cited and integrated to bolster your own assertions and to supplement your ideas.

Review the rubric in the Module 2 Materials folder for specific grading criteria.