Method of Investigation: The Net Worth Method: The Net Worth Method is used to determine the extent of stolen funds, and is ascertained as follows: 1. Assets – Liabilities = Net Worth 2. Net Worth – Prior Year’s Net Worth = Net Worth Increase 3. Net Worth Increase + Living Expenses = Income 4. Income – Funds from Known Sources = Funds from Unknown Sources Scenario: Mary works for John Black Consulting Group as an executive secretary in the administrative department for nearly 15 years. Her apparent integrity and dedication to her work quickly earned her a reputation as an outstanding employee and resulted in increased responsibilities. She soon made arrangement for outside feasibility studies, maintained client files, worked with outside marketing consultants, initiated the payment process and notified the accounting department of all opening s or closings of vendor accounts. During Mary’s first five years of employment BCG subcontracted all of its feasibility studies and marketing studies through Jackson & Co. This relationship was subsequently terminated because Jackson & Co merged with a larger, more expensive consulting group. At the time of the termination, Mary and her supervisor selected a new firm to conduct the BCG’s market research. However, Mary never informed the accounting department that the Jackson & Co account was closed. Her supervisor trusted her completely and allowed her to sign for all voucher payments less than $10,000. Mary continued to process cheques made payable to Jackson & Co. and deposited the cheques in the account. She paid all her personal expenses out of this account. We are investigating Mary’s fraud. As part of our investigation, we searched public records and other sources and accumulated the following financial information. With the information, we can use the net worth method to estimate how much Mary may have embezzled. Calculate Mary’s net worth from the following data. NB: the file attached contains the data of Mary's net wrth
Method of Investigation: The Net Worth Method:
The Net Worth Method is used to determine the extent of stolen funds, and is ascertained as
follows:
1. Assets – Liabilities = Net Worth
2. Net Worth – Prior Year’s Net Worth = Net Worth Increase
3. Net Worth Increase + Living Expenses = Income
4. Income – Funds from Known Sources = Funds from Unknown Sources
Scenario:
Mary works for John Black Consulting Group as an executive secretary in the administrative department for nearly 15 years. Her apparent integrity and dedication to her work quickly earned her a reputation as an outstanding employee and resulted in increased responsibilities. She soon made arrangement for outside feasibility studies, maintained client files, worked with outside marketing consultants, initiated the payment process and notified the accounting department of all opening s or closings of vendor accounts. During Mary’s first five years of employment BCG subcontracted all of its feasibility studies and marketing studies through Jackson & Co. This relationship was subsequently terminated because Jackson & Co merged with a larger, more expensive consulting group. At the time of the termination, Mary and her supervisor selected a new firm to conduct the BCG’s
We are investigating Mary’s fraud. As part of our investigation, we searched public records and other sources and accumulated the following financial information. With the information, we can use the net worth method to estimate how much Mary may have embezzled.
Calculate Mary’s net worth from the following data.
NB: the file attached contains the data of Mary's net wrth
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