After several months,
LRC’s supervisor is arrested for stealing nearly $10,000 from the
company. Identify the internal control weakness that allowed this theft to occur. |
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A.The accounting system was not adequate to detect the
fraud. |
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Answer. A
The accounting system was not adequate to deduct fraud.
A company shall keep their financial records computerized accounting environment by using information technology.
The good accounting system report on financial performance and cash flow of businesses and performance of an organisation this information is used by management for decision making purpose
In the above case even the fraud of cash by supervisor is taken place it taken several months to detect such fraud and to take appropriate action this is mainly due to deficiency in the accounting system
Even though the cash collection are to be taken and deposited in the bank account in one of the good internet system but the same should not be carried out by supervisor
Thank you hope my judgement my reach your expectations
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