The chief financial officer’s (CFO) motive for artificially reducing Holman’s days sales outstanding (DSO) figures was likely to manipulate the company’s financial performance metrics to create a more favorable impression for investors and stakeholders. A rising DSO, especially a dramatic spike to 120 days, is a red flag that the company is struggling to collect payments from its customers. This can signal liquidity problems, poor credit management, or even issues with the quality of its sales. By reclassifying trade receivables into notes receivables, the CFO was able to hide this negative trend and make the company’s financial health appear stronger than it actually was. This deception could have been driven by pressure to meet performance targets, secure bonuses, or prevent a decline in the company’s stock price.

Analysis of the CFO’s Actions Through the Book of Proverbs

The actions of Holman’s CFO directly relate to several ethical principles found in the book of Proverbs, which offers a clear guide for financial integrity and honesty.

1. Proverbs 10:9: “Whoever walks in integrity walks securely, but whoever takes crooked paths will be found out.”
   • Analysis: The CFO chose a “crooked path” by manipulating financial data. This act of deception, while temporarily hiding the company’s financial issues, will ultimately be “found out” by auditors, regulators, or investors. The lack of integrity creates a precarious situation that will likely lead to severe consequences for the CFO and the company.

2. Proverbs 11:1: “Dishonest scales are an abomination to the Lord, but a just weight is his delight.“

   • Analysis: The “dishonest scales” represent the CFO’s falsification of financial metrics. The DSO figure was not a “just weight” but a manipulated number designed to deceive. This action is a form of dishonesty that the scripture condemns, as it misrepresents the true value and health of the company.

3. Proverbs 28:20: “A faithful man will abound with blessings, but whoever hastens to be rich will not go unpunished.”
   • Analysis: This scripture directly addresses the CFO’s motive. The pressure to improve the company’s financial appearance and potentially secure personal gain (e.g., bonuses) led the CFO to act unfaithfully. The pursuit of quick, artificial success (“hastens to be rich”) through unethical means will inevitably result in negative consequences (“will not go unpunished”), such as regulatory fines, legal action, or job loss.
4. Proverbs 16:8: “Better a little with righteousness than much gain with injustice.”
   • Analysis: The CFO’s actions sought to achieve “much gain” (a better financial report) through “injustice” (deceptive accounting). This scripture teaches that it is better to accept the negative reality of a high DSO (“a little with righteousness”) than to fabricate a positive outcome through dishonesty. True, long-term success is built on ethical behavior, not on unjust gains.