Centurion Homes of Calgary, Alberta, builds houses and has four construction crews. The supervisors hire and terminate workers and keep their hourly records. Each Friday morning, the supervisors telephone their workers’ hours to the home office, where accountants prepare the weekly pay cheques. Around noon, the supervisors pick up the pay cheques. They return to the construction site and pay the workers at day’s end. What is the internal control weakness in this situation? Propose a way to improve the internal controls.
Centurion Homes of Calgary, Alberta, builds houses and has four construction crews. The supervisors hire and terminate workers and keep their hourly records. Each Friday morning, the supervisors telephone their workers’ hours to the home office, where accountants prepare the weekly pay cheques. Around noon, the supervisors pick up the pay cheques. They return to the construction site and pay the workers at day’s end. What is the internal control weakness in this situation? Propose a way to improve the internal controls.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Centurion Homes of Calgary, Alberta, builds houses and has four construction crews. The supervisors hire and terminate workers and keep their hourly records. Each Friday morning, the supervisors telephone their workers’ hours to the home office, where accountants prepare the weekly pay cheques. Around noon, the supervisors pick up the pay cheques. They return to the construction site and pay the workers at day’s end. What is the internal control weakness in this situation? Propose a way to improve the internal controls.
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