Harold Jones, the financial aid officer at a small university, manages all aspects of the financial aid program. Jones receives requests for aid from students, determines whether the students meet the aid criteria, authorizes aid payments, notifies the applicants that their requests has been either approved or denied, writes the financial aid checks on the account he controls, and requires that the students come to his office to receive the checks in person. For years, Jones has used his position of authority to perpetrate the following fraud.
Jones encourages students who clearly will not qualify to apply for financial aid. Although the students do not expect aid, they apply on the off chance that it will be awarded. Jones modifies the financial information in the student’s applications so that it falls within the established guidelines for aid. 1k then approves aid and writes aid checks payable to the students. The students, however, are informed that aid was denied. Because the students expect no aid, the checks in Jones’s office are never collected. Jones forges the students’ signatures and cashes the checks.

Required
Identify the internal control procedures (classified per SAS 78/COSO) that could prevent or detect this fraud.