And The Fraud Continues- Case 1

1.Discuss the inhering control weaknesses that existed at MCI that contributed to the commission of this fraud The immense Internal control weaknesses existed at MCI was that Pavlo so-and-so dodge the measure Receiv satisfactory system which he had helped to pretend and develop. When the same employee is able to assimilate payments, update or manipulate papers receivable records, or even reconcile the companys situate account, he may be able to embezzle capital from the company (http://smallbusiness.chron.com/strengths-weaknesses-accounts-receivable-35111.html) that was exactly what fly the coop on to MCI with Pavlo, through the by-line tricks: a)Identifying Account receivables that were going to be indite sour and converted them into nones receivable, this way expenses are not affected and an Asset is created in the balance sheet. b)Unapplied cash was utilise to mask the severe debt and delay payments, the allocations of amounts over certain sums of silver to neglectful or bad receivables, made the expenses related to the spare off of the receivables would not correspond the income statement. c)Placeholder credits was used.

If when MCI called customers regarding their overdue account receivables, were told that they were sending in a payment immediately, MCI attribute their receivables forwards receiving the cash. Pavlos usage of the Account receivable on MCI permit him delayed the inevitable, the acquaintance of bad debt and uncollectible receivables that would ready to be expensed on the income statement. 2.Identify and loose the approach you would take if you danger fraudulent activity at heart an organization where you work. If I menace fraudulent activity within an organization where I work, I would us a paid skepticism as a neutral but make grow approach to detection and investigation. SAS zero(prenominal) 1 suggest that an auditor neither assumes that management is Janus-faced nor assumes uncontroversial honesty. In practice, professional...If you want to force a abounding essay, nightclub it on our website: Orderessay

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