Suppose you own a number of wine shops selling mid-level as well as expensive bottled wine. You have been experiencing significant losses from theft at your stores. You suspect that it is a combination of both employee and customer theft. Assuming that it would be cost-effective, would you install video cameras to reduce both employee theft and customer theft?

YES: Most employees and customers are honest. However, some will steal if given the opportunity.
Management has a responsibility to employ reasonable, cost-effective approaches to safeguard company assets.
NO: The use of video technology to monitor employees and customers sends a message of distrust.
You run the risk of alienating your employees (who may well figure out a way around the cameras anyway). Cameras might also reduce the welcoming atmosphere for your customers, who might find the cameras offensive.
Instructions Write a response indicating your position regarding the situation, provide support for your view.
FASB Codification Activity