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Details: It has come to the CEO's attention that Sally, a company salesperson, grants the rights to wholesalers to return unsold product. He asks you to discuss the following at the next board of directors meeting:
• In the system of internal control, are Sally's actions a significant deficiency or a material weakness?
• Explain your reasoning and rationale.
Objective: •Develop an auditor report attesting to management's assertions regarding the effectiveness of internal controls and recognize situations that present potential ethical and legal issues and develop solutions for those issues.
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