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(Learning Objectives 1, 2: Learning about fraud; identifying internal control weaknesses) Identify the internal control weakness in the following situations. State how the person can hurt the company. a. Jim Morris works as a security guard at SAFETY parking in Budapest. Morris has a master key to the cash box where customers pay for parking. Each night Morris prepares the cash report that shows (a) the number of cars that parked on the lot and (b) the day’s cash receipts. Lucy Carrols, the SAFETY treasurer, checks Morris’s figures by multiplying the number of cars by the parking fee per car. Carrington then deposits the cash in the bank. b. Cecilia Albom is the purchasing agent for Marshfield Golf Equipment. Albom prepares purchase orders based on requests from division managers of the company. Albom faxes the purchase order to suppliers who then ship the goods to Marshfield. Albom receives each incoming shipment and checks it for agreement with the purchase order and the related invoice. She then routes the goods to the respective division managers and sends the receiving report and the invoice to the accounting department for payment.
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