I don’t understand this Accounting question and need help to study.
REspond to alecia
Discussion Board 12
Yes, they did act unethically in this situation and I also believe immorally. The investors made their decision on the assumption and knowledge that their bonds were worth a certain amount and were staying that amount because of the company’s misleading information. If I were an investor in this company I would not be too happy with the fact that they led me on to purchase a bond and then once I purchased the bond, changed their plans. The problem is that they knew that they wanted to issue more bonds and what would happen when they did.
According to this article, this is not only unethical but it is fraudulent as they omitted information in order to gain investors. The company can get into some serious legal trouble for this and in the future there won’t be nearly as many investors because they are no longer trustworthy. I also believe that because of this fraud, they won’t be able to gain investors to buy the new bonds and so all of this activity was probably pointless anyway.