A former chairman, CFO, and controller of Donnkenny, Inc., an appeal company that makes sportswear for Pierre Cardin and Victoria Jones, please get guilty to financial statement fraud. These manager used false journal entries to record fictitious sales, head inventory and public warehouses so that it could be recorded as sold and required sales orders to be backdated so that the sale could be moved to an earlier period.the combined effect of these actions caused 25 million out of 40 million and quarterly sales to be phony. A. Why might control procedures listed in this chapter be insufficient in stopping this type of fraud? B.Would an audit committee made up of representatives from Senior Management be effective in stopping this type of fraud?
A former chairman, CFO, and controller of Donnkenny, Inc., an appeal company that makes sportswear for Pierre Cardin and Victoria Jones, please get guilty to financial statement fraud. These manager used false journal entries to record fictitious sales, head inventory and public warehouses so that it could be recorded as sold and required sales orders to be backdated so that the sale could be moved to an earlier period.the combined effect of these actions caused 25 million out of 40 million and quarterly sales to be phony.
A. Why might control procedures listed in this chapter be insufficient in stopping this type of fraud?
B.Would an audit committee made up of representatives from Senior Management be effective in stopping this type of fraud?
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