Understanding HealthSouth's Aggressive Revenue Recognition

Writing Homework 4 Read Going Green, Auto Parts, Inc., Satyam Computer Answer the following questions regarding Going South. 1. What were the balance sheet and income statement implications of HealthSouth's aggressive revenue recognition tactics? Also, in what specific way did this scheme violate the revenue recognition principle? 2. What are the financial reporting motivations for capitalizing expenditures that should be classified as operating expenses? Please provide additional examples where other companies have used this (or a similar) strategy. 3. In your opinion, why didn't the EY partner more fully investigate the whistleblower e-mail from Michael Vines? How might you have handled the situation differently? Instructions: Please submit the writing homework via turnitin within the assignment folder. The assignments are meant to challenge your critical thinking, problem solving and knowledge on audit rule(s)/standard(s) in the context of specific problems facing the (internal and external) auditing industry. Students are expected to provide primary accounting/auditing issues of each case and relate them into the guidance of audit standards/rules, and demonstrate individual decisions/stances for each specific situation. You may need to search from supplemental readings to better understand the related professional/audit standards. In order to receive full credit, the submission should be completed on at least one-page Microsoft word file, single space, times new roman font, and size 12. Supplemental Reading PCAOB Standards and Related Rules. Information may be found atwww.sec.gov, www.aicpa.org, www.pcaobus.org, www.coso.org, www.cpaboard.state.la.us, www.tsbpa.state.tx.us, www.isaca.org, etc