You are an auditor reviewing the financial statements of a firm that manufactures construction equipment The firm's sales have slowed in recent months. Within the last quarter it has closed one of its lactones, however the firm's management are still reporting a positive outlook. Concerned shareholders have asked you to investigate (or possible signs of improper accounting or fraud.

You are reviewing two balance sheets from the start and end of the quarter below Given this information and your knowledge of the company s status which issue is MOST likely to be a red flag?