Control and accounting information systems suggested answers to discussion questions


Bad debt write-offs are prepared and approved by the same employee



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rais12 SM CH07
Bad debt write-offs are prepared and approved by the same employee.
Collusion between customers and the employee writing off the bad debts.

Require all bad debt write-offs to be approved by a second employee.



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Occasional discrepancies between physical inventory counts and perpetual inventory records.
Unauthorized access to physical inventory and/or inventory records.
Inventory theft by employees


Limit physical and logical access to the inventory records to authorized employees.
Require that all adjustments to inventory records be approved by a responsible official.

Count all inventory when received at the warehouse and at the storeroom; reconcile the counts.


Count inventory to be shipped before it is removed from the storeroom, when received by shipping, and when shipped; reconcile counts.
Bar codes and RFID tags to facilitate counts
Hold storeroom employees responsible for all inventory losses.


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