Migdalia Ruiz Summary

First and foremost, the accounting system used should be updated. The case stated that the system was 30 years old and that prior accounting period transactions could not be locked down, which enabled internal control processes to be bypassed. Enhancing internal

The case of Rita Crundwell revolves around a town, other employees, and an auditor 's blind trust in a women, who clearly did not deserve the trust. Crundwell was the town Comptroller. The fraud resulted in 53 million dollars to be siphoned from the town 's funds in a time frame of 20 years. Crundwell covered her tracks with a fake bank account, fake invoices, and the party line of blaming the state for simply being behind on payments. There were many red flags during the two decades of this scheme, but due to the town 's small size and trusting attitude, they relied heavily on external audits, which were not up to par.

Appendix A.2 also lists several factors that could provide opportunities for management/employees to commit fraud. One factor that could lead to fraud is if, “There is ineffective monitoring of management as a result of: domination of management by a single person or small group without compensating controls.” The auditors should have taken notice of the lack of controls and segregation of duties with respect to Phar-Mor’s

In R v. Potisk (1973) The Police charged Potisk with larceny after he was given $2895.17 instead of $1233.23 by a bank teller when exchanging the USD currency and was found not guilty by the supreme court after the judge ruled that it is was not larceny and he was given the money although he was being dishonest. The law is effective in determining justice in this case because he didn't take the money without consent, he was being dishonest and was found not guilty because the judge and evidence proved he committed no econmoic offence. When it comes to white-collar crimes tax evasion is the most common of the three offences (Insider trading, tax evasion and computer crimes). These three offences have different sentences depending on the severeity of the crime but have a minimum of 8 years

Two of the three partners of the firm that performed the audit for the district had 55% ownership in the company that sold the district its financial management software “finance manager”. The partners’ role as vendors violated the general standard of independence under generally accepted government auditing standards. Also the auditors received a commission from the sale of another software called “student manager” and receiving commissions is prohibited by the AICPA. Also there were fundamental problems with their audit planning and efforts to test financial records. The CPA firm work that was so flawed and so far below professional standards that it failed to identify the millions that were stolen.

During the time of the scandal, which broke in mid-2005, PBS&J had 4,000 employees in 75 offices in 24 states (Barnett, 2007). A number of high-profile projects were under construction with FDOT, OOCEA, and TxDOT. The funds from these projects were being brought into the firm at a rapid rate; however, PBS&J contained a flimsy internal controls system which facilitated the embezzlement that eventually took place. The major players of the scandal were located in the firm’s Miami office. They were Scott DeLoach, then chief financial officer (CFO); Maria Garcia, an accounting employee who was in charge of the office’s database and bank reconciliations; and Rosario Licata, a bookkeeper who maintained the firm’s benefits bank account (Eubanks, 2016).

The behavior exhibited by the founders in intuiting that it was Samarin’s responsibility to load the illegal software, and in creating a financial management environment with an evidenced lack of financial restraint further demonstrates an organizational culture of low accountability and questionable ethical standards.

The one pattern within the data that appears to be inconsistent yet if the auditors had established an internal control systems would be Monus the founder moving so freely throughout every aspect of the company with no one checking his movements. From choosing what properties to purchase to purchasing supplies. In any company there should be segregation of duties. For example, the person making the deposits should not be the person writing the checks. Had there been stipulations made it would not have been so convenient to commit the

Scenario 3: Elaine R. was an accountant working for a large corporation. She had been falsifying the accounting records and sending some of the corporate funds to her own bank accounts in an offshore bank. The corporation found out what she had been doing and reported her to the police. Category of crime white collar crimes, Elaine

Bell, a city of 35,000 people, has remained to be the greatest scandal in California. For a long time, the manager of Bell City Robert Rizzo and the people he was working with exploited the governance systems and the finances of the city (McGrath 122). They used vast sums of money to pay their salaries. They also transformed the development agency of the town into a piggy bank, from where they borrowed funds in an improper way, deposited money in retirement accounts that was illegal, purchased property without accounting in and documents, approved fees and taxes that were illegal and found out a way of exempting themselves from state law. Court documents provide evidence to show that indeed, those people committed the crime of corruption.

The main objective of this investigation is to see if funds are being misappropriated and who is misappropriating these funds. In conducting this investigation we needed to take many steps to ensure that the tip that the department received was true. To begin we checked personnel records and company records to gather information (Albrecht, Albrecht, and Zimbelman, 216) on the suspect, Rita Crundwell. Information such as how long has this suspect has worked in the city, what her position is, and what it entails. We also went through the accounts that she is transferring the cities money into and verified that all of these are all legitimate accounts of the city. If we found any errors or accounts that were not legitimate we would note these down and ask Rita about these accounts during the interview.

All the working staffs should be trained to be trustworthy employees so that this type of behavior is curbed in the future. Every person need to be feeling secure when having their money in the bank (Higgins, 2015). Though it shall be a difficult task especially maintaining the old customers apart from creating new account with the bank. The bank is supposed to create a video series which is only view internally in which the senior executives are require to have a discussion on all the grey areas of ethics. Through this they shall be able to manage their business in terms of making operational and managerial decisions. These videos shall play a major role in the management of the operations in the bank. The bank should explain to its employees that after they are found guilty in the bank they shall be fined before being

Phar-Mor was known as one of the major discount chain retailers in the late 1980’s - early 1990’s. It was founded by Mickey Monus, a gambler in nature, who with the help of senior management was “cooking the books” for years to cover up his loses. The reason why senior management agreed to do this fraud is the belief in unique ability of their leader to fix everything later on. This case is known as one of the biggest accounting frauds in the corporate history of the U.S. This paper will analyze who was affected by this fraud, the motives behind it and what systems of control failed to prevent it.

As the WMI accounting fraud case shows, change exposes organizations to considerable financial fraud risks. The top officials used acquisitions and merger as means to perpetuate this fraud. This financial fraud took place due to the organizational breakdown of internal and external audit controls. As a result, the top management was able to commit this massive fraud without facing any resistance. It never occurred to them that they were violating the law because what mattered to them was pocketing as much as they could.

The greatest opportunity for Minkow to commit fraud was ZZZZ Best’s lack of financial supervision. Lack of internal control facilitated manipulation of company’s assets and transactions. It gave the CFO the opportunity to falsify the documents and to create fictitious transactions. These transactions created formidable revenues on the company’s books and made it easy to borrow money from banks. The weak external audit was the other opportunity that allowed Minkow to commit fraud. The auditor was not familiar with the company and its related parties. In addition, the auditors placed too much trust in management produced documents and failed to verify key transactions. These two important reasons gave Minkow an opportunity to commit fraud.