A1. (LO 1) Fraud Early Career Critical Thinking Josephine is the accounting supervisor in a medium-sized, family-owned com- pany, Cape Renovations. Josephine has a bachelor's degree with a major in accounting. She has worked for Cape Renovations for 11 years. The company performs renovation work on damaged prop- erties in Florida. Josephine manages and maintains the general ledger for Cape Renovations. She is also responsible for the day-to-day, routine operations in the Accounting department. She reports to the chief accountant, Jerome Gonzales. On Fridays. Josephine collects all the invoices scheduled for payment the following week. She collects and prepares the docu- mentation to support check preparation. Libby, an Accounts Payable accountant, processes the payments to the vendors, arranges for the printing of the checks, which are signed electronically, and prepares the cash payments listing. Libby collects the signed checks and sends them to the mailing clerk for timely mailing. She then gives a printout of the cash pay- ments listing to Jerome, who performs the monthly bank reconcilia- tion, and she files the invoices and supporting documentation. Libby is also responsible for reconciling the accounts payable subsidiary ledger to the control account in the general ledger each month. You are interning at a local CPA firm for the semester, and the owners of Cape Renovations have engaged your firm to help improve its system of internal control. The company's financial statement ratios over time are showing some disturbing trends, with no logical explanation. Your assignment is to review the controls, specifically separation of duties, over Accounts Payable. Identify segregation of duties deficiencies in the accounts payable function at Cape Renova- tions. If you find deficiencies, explain what the consequences could be and how to mitigate that risk