Questions: 1) When company management makes vendors and suppliers aware of company policies and procedures, what frequently occurs?
- Vendor and supplier purchases increase
- Fraud risk is reduced
- Procurement fraud increases
- Vendor and supplier relationships deteriorate
2) A retail home improvement chain had decreased profitability in the past 6 months due to bad debts. In order to increase sales, store managers have allowed customers to make large credit purchases without a credit review. Which type of internal control is missing from the chain's internal control system?
- Separation of duties
- Documentation
- Authorization
- Independent checks