1.A construction company found that its accountant was embezzling (i.e., stealing money from the company) using a technique called lapping. A typical lapping scenario work like this: The embezzler steals the payment on Invoice A, which is $1,000. He or she then takes the money from a larger invoice, such as Invoice B for $2,000, and uses part of those funds to pay the $1,000 from Invoice A. The embezzler will then repeat the process, paying the missing part of Invoice B with funds from Invoice C, and so on. Thus, the business account is always short the stolen $1,000, but it will appear as though the invoices have been paid. Would cash-basis or accrual accounting make this kind of stealing easier to detect? Explain your answer.

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