Fredrick Limited revealed a fraud whereby one of its office administrative staff members used the company's money to purchase goods, such as computers, mobile phones, and other items for his use. The fraud was discovered when employees noticed an increase in delivery frequency and the use of unusual suppliers. After some investigation, it was found that the office administrator would alter the description or change the quantity on an invoice to explain the bill's cost.

Questions

1. What general internal control weaknesses do you see that contributed to this fraud? (10 marks)
2. Why is it vital to have a sound internal control system in the organisation? Explain in detail with examples using academic sources. (15 marks)