In each of the five scenarios relating to the expenditure cycle:

i.Explain the nature of the threat in your own words; and

ii. Explain clearly an internal control that would have minimised or eliminated the threat.

Scenario 1

A clerical employee obtains a blank cheque and writes a large amount payable to a fictitious company.The employee then cashes the cheque.

Scenario 2

Receiving dock personnel steal inventory and then claim the inventory was sent to the warehouse.

Scenario 3

A purchasing agent orders materials from a supplier that he partially owns.

Scenario 4

A fictitious invoice is received and a cheque is issued to pay for goods never ordered or delivered.

Scenario 5

A clerk affixes a price tag intended for a low-end flat panel TV to a top of the line model.The clerk's friend then purchases that item, which the clerk scans at the checkout counter.

Please note:

You must explain the nature of the threat in your own words and then explain a control that would minimise or eliminate the threat.Marks will be deducted for poor written expression.