The Following Situations Are Independent of Each Other

question 103

Essay

The following situations are independent of each other.
1. Jim's Electronic Games is a very relaxed place to work. Unissued blank cheques are left in a box on the floor near the printer.
2. XL Products requires every cheque to be signed by the President and the VP Finance. Because the President travels a lot, he signs several blank cheques in advance of each trip so that his absences will not interfere with the operations of the Accounts Payable department.
3. Dubois Books is short staffed and the accounting department is very busy. As soon as the cheques are printed they are sent to the Executive office to be signed while the invoices that were paid are immediately filed so that the work will not get backlogged.
4. At Nora Sales, two accounting clerks share cheque disbursement duties. They can tell which invoices have been paid by whether they are located in the "unpaid" basket or in the vendor file.
Instructions
For each weakness, describe what could go wrong and make a recommendation to improve internal control.

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Definitions:

Interest Rates

The expense associated with lending money or the incentive for saving it, typically described as a percent of the total amount per year.

Capital Accumulation

The process of acquiring additional assets or wealth, particularly by businesses or the economy, to create further wealth or produce goods and services.

Fiscal Policy

Government policies related to taxation and spending designed to influence economic conditions, including demand, employment, and inflation.

Aggregate Demand

The entirety of demand for products and services in an economy, pegged at a general price level during an established time frame.