User Account

All Pages

What was the key control weakness in the case

Assignment Help Accounting Basics
Reference no: EM132709362

Levon Helm was a kind of one-man mortgage broker. He would drive around Tennessee looking for homes that had second mortgages, and if the criteria were favorable, he would offer to buy the second mortgage for "cash on the barrelhead." Helm bought low and sold high, making sizable profits. Being a small operation, he employed one person, Cindy Patterson, who did all his bookkeeping. Patterson was an old family friend, and he trusted her so implicitly that he never checked up on the ledgers or the bank reconciliations. At some point, Patterson started "borrowing" from the business and concealing her transactions by booking phony expenses. She intended to pay it back someday, but she got used to the extra cash and couldn't stop. By the time the scam was discovered, she had drained the company of funds that it owed to many of its investors. The company went bankrupt, Patterson did some jail time, and Helm lost everything

Requirements

Question 1: What was the key control weakness in this case?

Question 2: Many small businesses cannot afford to hire enough people for adequate separation of duties. What can they do to compensate for this?

Reference no: EM132709362

Questions Cloud

Analyze whether using compliance techniques is ethical : For example, you can analyze whether using compliance techniques is ethical and under what circumstances. You can weave in some techniques into your argument.
Discuss the allowance method and the direct write-off method : Discuss the allowance method and the direct write-off method of accounting for bad debts. When is the expense for uncollected accounts receivable
Relationship between prosperity and political survival : Explain the relationship between prosperity and political survival in democracies and autocracies using the Selectorate Theory. Then find two case studies
What is the effect of the stock dividend on the stockholders : An owner of 300 shares of Colorado Spring Company common stock receives a stock dividend of 6 shares. What is the effect of the stock dividend on stockholders
What was the key control weakness in the case : Many small businesses cannot afford to hire enough people for adequate separation of duties. What can they do to compensate for this?
Identify the specific concept from psychosocial theory : Identify the specific concept from psychosocial theory that supports the use of this activity. Identify how the activity enhances psychosocial development.
How can a business protect against the kind of fraud : Was Frank's company hurt in any way by this fraudulent action? How can a business protect against this kind of fraud? How could this action hurt Frank?
What is the effect on the corporation revenue of the period : Problem - The treasury stock in Question 14 is resold for $2,400,000. What is the effect on the corporation's revenue of the period
What effect does it have on stockholders equity : A corporation reacquires 18,000 shares of its own $50 par common stock for $2,250,000, recording it at cost. What effect does it have on stockholders equity

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd