Homework Sourse3 Per the article Keep Ghosts Off the Payroll most ghost emp
3. Per the article Keep Ghosts Off the Payroll, most ghost employee frauds originate in the payroll department.
MULTIPLE CHOICE
True or false
4. A salesman may fraudulently increase his commission by:
MULTIPLE CHOICE
a. Falsifying the amount of sales made.
b. Increase his rate of commission.
c. Both 1 & 2.
d. Neither 1 nor 2.
7. When it comes to upper management, there is no such thing as an immaterial fraud.
MULTIPLE CHOICE
True or false
10. An employee cheating on his expense report may be detected by:
MULTIPLE CHOICE
a. Performing a bank reconciliation.
b. Insuring all checks are signed by an authorized signer.
c. Investigating a variance in the budget to actual travel & entertainment expense account.
d. Having all employees prepare their own expense reimbursement reports.
| a. Falsifying the amount of sales made. | ||
| b. Increase his rate of commission. | ||
| c. Both 1 & 2. | ||
| d. Neither 1 nor 2. |
Solution
3) True, because they most originate in the payroll department.
4) The correct option is c. Both 1 & 2 because a salesman may fraudulently increase his commission by falsifying the amount of sales made and increasing his rate of commission.
7) True because an executive who eats on his or her expense account may also cheat big time on the company\'s financial statements.
10) The correct option is c. Investigating a variance in the budget to actual travel & entertainment expense account because if employee cheats on his expense report it can be easily identified with the variances.
