Question - Fraud examination (An essay 5 paragraphs)
An accountant for small business is suspected of writing checks to "dummy" vendors and collecting the money himself. After a thorough investigation of the company, you determine that the company does not require authorizations for vendor payments. In an interview with the suspect, you ask him if any controls are in place that could prevent someone from writing fraudulent checks. He quickly responds in the affirmative.
What type of questions could you ask next? (some materials which i started to write, you can use).
What controls are in place?
Who will authorize the vendor payments?
Whether any procedure is followed for the disbursements to the vendors? What was the procedure?
Who was the accounts manager who supervises the transactions, any MIS reports are prepared listing the payments made during the week or month.
What the credit payment procedures and any ageing schedule maintained?
Whether list of vendors and their balances are maintained and updated time to time basis and approved by the accounts manager?