And The Fraud Continues- Case 1

1.Discuss the interior(a) control weaknesses that existed at MCI that contributed to the commission of this fraud The immense Internal control weaknesses existed at MCI was that Pavlo apprise wangle the measure Receiv commensurate system which he had helped to shape and develop. When the same employee is able to run across payments, update or manipulate papers receivable records, or even reconcile the companys buzzword account, he may be able to embezzle currency from the company (http://smallbusiness.chron.com/strengths-weaknesses-accounts-receivable-35111.html) that was exactly what be carry on to MCI with Pavlo, through the following(a) tricks: a)Identifying Account receivables that were going to be indite sour and reborn them into nones receivable, this way expenses are not affected and an Asset is created in the balance sheet. b)Unapplied cash was employ to mask the mentally ill debt and averse payments, the allocations of amounts over certain sums of cash to remiss or bad receivables, made the expenses related to the import off of the receivables would not polish off the income statement. c)Placeholder credits was used.

If when MCI called customers regarding their overdue account receivables, were told that they were sending in a payment immediately, MCI assign their receivables forwards receiving the cash. Pavlos consumption of the Account receivable on MCI permit him delayed the inevitable, the acknowledgement of bad debt and uncollectible receivables that would have to be expensed on the income statement. 2.Identify and let off the approach you would take if you imagine fraudulent activity within an organization where you work. If I punt fraudulent activity within an organization where I work, I would us a master skepticism as a neutral but discipline approach to detection and investigation. SAS zero(prenominal) 1 suggest that an auditor uncomplete assumes that management is Janus-faced nor assumes uncontroversial honesty. In practice, professional...If you want to stimulate a abounding essay, swan it on our website: Ordercustompaper.com

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