Give two examples of employee fraud and explain how the theft might occur
Answers will vary but should involve (1) stealing something of value, (2) converting the asset to cash and ((3) concealing the act.
Examples could include" Charges to expense accounts: Cash could be stolen and charged to a miscellaneous expense account. Once the account is closed, detection would be more difficult. Lapping: This involves converting cash receipts to personal use. If a customer's check is taken, his/her balance will not reflect a payment and will be detected when a statement is sent. In order to conceal this fraud, a later payment is used to cover the stolen check. This is in effect a small scale Ponzi scheme.
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