In Each of the Following Situations, Identify the Internal Control

question 81

Essay

In each of the following situations, identify the internal control weakness as well as the business's potential problem, and suggest a solution.
a. Susan Scandal purchases supplies for Fraud Fortress Company and stores them in a locked room for which she has the key. She is also responsible for distributing these supplies to employees upon request. At the end of each month, Susan takes an inventory of the supplies on hand and notifies the accounting department of the amount for the adjusting entry for supplies used.
b. Jim Devious, an accounting clerk, is responsible for opening the mail, recording and depositing cash receipts, and preparing the monthly bank reconciliation. Jim has not taken a vacation in over five years.
c. The law firm of Dewey, Cheatem & Howe has been extremely busy in recent months. The firm needs another lawyer but has not had the chance to hire one. In the meantime, one of the secretaries has been preparing briefs, writing up wills, and preparing the closing papers for various real estate deals.

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Definitions:

Indirect Institutional Discrimination

When individuals are treated differently based on an unlawful criterion (physical disability, cultural origin, age, gender, religion), even though these actions were never intended to be discriminatory.

Discriminatory Policies

Practices or directives that result in unfair treatment of individuals or groups based on specific characteristics, such as race, age, or gender.

White Canadians

Individuals residing in Canada who identify as being of European descent or identify primarily with white cultural characteristics.

Democratic Racism

A system that advocates equality but in fact perpetuates minority differentiation and oppression.