internal control methods.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Can you write a reply for detect only, thank you
![The case:
In this case, a medium-sized, family-owned business suffered a significant loss of inventory due to
theft by several long-time employees.
Overall: Several factors played into the inventory theft, including poor internal controls, a lack of
timely accounting records, and difficulty in measuring and tracking inventory items.
Inventory was not reconciled or monitored for the company-owned retail outlets which enabled the
misappropriated inventory to be removed from inventory records without detection.
Identify and describe the followings:
1. a measure that could have prevented the theft
2. a measure that could have detected the theft
3. a step to take once fraud is suspected.
My work:
Internal controls are protocols and procedures used by a business to protect its assets and maintain
the accuracy of its financial records. Employee theft is a common problem that can have serious
consequences for businesses, with 75% of businesses being affected by it and 33% going bankrupt
due to employee theft. Many businesses do not report employee theft to law enforcement, often
because they do not want to damage their reputation or because they have weak internal controls in
place. Segregation of duties is a key component of internal controls that involves assigning different
tasks and responsibilities to different employees, which can help prevent and detect employee
theft. To detect employee theft, businesses can use techniques such as surprise audits, data
analysis, and surveillance. To prevent and deter employee theft, businesses can implement strong
internal controls, such as segregation of duties, background checks, and employee training, as well
as create a positive corporate culture and conduct regular audits.
My question:
What else can be done to help detect the theft? can you use internal control methods.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe4dac611-5fd0-4f2e-ac5b-1b0fd50ca184%2Fdae57d2f-3283-4243-b2e1-e6835ab35152%2Fc352vqn_processed.jpeg&w=3840&q=75)
Transcribed Image Text:The case:
In this case, a medium-sized, family-owned business suffered a significant loss of inventory due to
theft by several long-time employees.
Overall: Several factors played into the inventory theft, including poor internal controls, a lack of
timely accounting records, and difficulty in measuring and tracking inventory items.
Inventory was not reconciled or monitored for the company-owned retail outlets which enabled the
misappropriated inventory to be removed from inventory records without detection.
Identify and describe the followings:
1. a measure that could have prevented the theft
2. a measure that could have detected the theft
3. a step to take once fraud is suspected.
My work:
Internal controls are protocols and procedures used by a business to protect its assets and maintain
the accuracy of its financial records. Employee theft is a common problem that can have serious
consequences for businesses, with 75% of businesses being affected by it and 33% going bankrupt
due to employee theft. Many businesses do not report employee theft to law enforcement, often
because they do not want to damage their reputation or because they have weak internal controls in
place. Segregation of duties is a key component of internal controls that involves assigning different
tasks and responsibilities to different employees, which can help prevent and detect employee
theft. To detect employee theft, businesses can use techniques such as surprise audits, data
analysis, and surveillance. To prevent and deter employee theft, businesses can implement strong
internal controls, such as segregation of duties, background checks, and employee training, as well
as create a positive corporate culture and conduct regular audits.
My question:
What else can be done to help detect the theft? can you use internal control methods.
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