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Question : 159. Listed below 13 specific fraud examples taken from some well-known

159. Listed below are 13 specific fraud examples taken from some well-known fraud cases: MiniScribe, ZZZZ Best Carpet Cleaning, Lesley Fay, and Equity Funding.

Required:
For each fraud example, enter a letter corresponding to which information control goal was initially violated¾Validity, Completeness, or Accuracy. Some examples might involve more than one violation.

NOTE: When we say initially, we mean what control goal failure led to this example, not what is the present condition. For example, master data might contain information that is inaccurate, but it might have been an inaccurate input that initially caused the data to be inaccurate.

Fraud Examples:

Control
Goal
Initially
Violated




Scenario

          

1.

MiniScribe: Sales were inflated by shipping disk drives that were not ordered by customers.

          

2.

MiniScribe: Sales of goods were recorded prior to the passing of title.

          

3.

MiniScribe: Some sales returns were never recorded.

          

4.

MiniScribe: Defective disk drives were included in inventory.

          

5.

MiniScribe: Auditors' work papers were altered to inflate inventory values.

          

6.

ZZZZ Best Carpet Cleaning: Phony receivable/sales documents were created to overstate sales.

          

7.

ZZZZ Best Carpet Cleaning: Payments were recorded to fictitious vendors.

          

8.

Lesley Fay Cos.: Inventory was overstated, thereby understating cost of goods sold.

          

9.

Lesley Fay: Markdown allowances to retailers were understated or omitted.

          

10.

Lesley Fay: Suppliers' invoices were not recorded.

          

11.

Lesley Fay: Revenues and profits were inflated by recording sales entries for several days after a quarter had ended.

          

12.

Equity Funding: 63,000 bogus insurance policies were created and recorded.

          

13.

Other: A bank teller stole $1.5 million by pocketing customer deposits. He covered his theft by accessing an unsecured computer terminal and transferring funds from dormant bank accounts into the accounts of customers from whom he had received deposits.

Solution
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