Answer:
Consider the following calculation
Explanation:
Answer a)
The accountant fit the fraud profile in that he was
Young and energetic
Possessed knowledge, experience, and skills required
A dedicated, loyal and trusted employee of the organization.
An honest, valued, and respected members of the community
Answer b)
The accountant prepared fake invoices from legitimate contractors, wrote checks to pay those invoices, and then deposited the checks into a bank account he had opened under the name of one of the companies.
Answer c)
All he had to do was create fictitious invoices, as he had custody of checks before and after they were signed and he had the authorization to approve payments and sign checks. The fraud could have been prevented by separating accounting duties among different persons.
Restrict access to company checks and the check signing machine to someone that does not have recording or authorization responsibilities.
Do not permit the person that prepares the check to disburse the check.
Have someone familiar with the contractors authorize the payments – someone who would have known that the goods and services were never ordered or performed. This should be someone other than the preparer of the check; that is, someone without custody or recording functions.
Required that someone other than the people with custody and authorization responsibilities record the payments.
Answer d)
A bank reconciliation prepared by somebody else. An Olympic Committee official should have reviewed bank statements and cancelled checks.
Periodic confirmations of invoices with vendors' Ledgers.
Analytical reviews designed to detect an abnormal increase in certain heads of expenses.
