Question
Case 1 The management of AAAA Company has observed that the company s cash outflows have been increas- ing much more rapidly than its inflows.
Case 1
The management of AAAA Company has observed
that the company
s cash outflows have been increas-
ing much more rapidly than its inflows. Management
cannot understand the chang
e; from its perspective, it
has been
business as usual.
Management has asked
you, a fraud expert, to help them understand what is
going on.
You have decided that the best place to start your
investigation is to take a sample of canceled checks and
verify that both the controller and another manager
signed them
a procedure required by company policy.
Check numbers for the period range from 100 to 800.
Using Table 8-1, follow the instructions below to
select a random sample of 15 checks to examine.
Start from the bottom left of the table.
Move through the table from left to right and from
bottom to top.
Skip the numbers outside the relevant range.
Use the middle three digits of each number
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