In each of the following cases, what component of good internal control is being violated (if any)?
Question:
In each of the following cases, what component of good internal control is being violated (if any)?
1. Tough Ltd pays all its employees minimum wages and does not have pleasant working conditions.
2. Fred is a very conscientious employee who does such a good job that he does pretty much all of Whisp Ltd's office tasks.
3. Garand Ltd has a sophisticated internal control system that prints out various reports on discrepancies, which company management asks the accounting clerks to investigate and resolve.
4. John runs a small warehousing business. He's proud of saving money on accounting. For example, the reason he gives for not keeping track of purchases and shipments of goods is that he can 'look at the shelves and see if everything is all right'.
5. Wildwood Restaurant is proud of its 'family approach' to its employees, taking great care to make them feel important and trusted. Everyone has a key to the restaurant and several employees can often be found there after hours, helping to clean and prepare for the next day.
6. Hadlee Corp's founder, getting on in years, has turned the CEO's job over to his playboy son who is quite interested in horse racing and turns up at the office only occasionally.
Step by Step Answer:
Financial Accounting An Integrated Approach
ISBN: 9780170349680
6th Edition
Authors: Ken Trotman, Michael Gibbins, Elizabeth Carson