Karim was hired as an accountant in family business company. As his personal monthly bills increased, he found it difficult to maintain the life expenses. Karim began illegally using his business purchasing card for small personal expenses, such as gas for his personal vehicle and fast food meals. After several months, his charges for personal expenses increased in number and amount. No one at company noticed the continual increase in charges for personal items because Karim controlled all payment checks to the credit card company. Karims' fraudulent activities expanded. He began embezzling from the payroll system. Because he became in charge of all the accounting operations, he didn't have to use the time clock and began to pay himself for excessive overtime pay. He then began writing checks payable to himself, but he would write a regular recurring vendor's name on each check into the computer system. When the bank statements came each month, Karim would alter the images of the checks on the statements to match the vendors on the check stubs and in the system. Then he would hide evidence of the fraudulent checks he had cashed by photocopying the altered pages of the bank statements and shredding the original statements.

Read the above case and choose the best answer of the following:

The following action by Karim he didn't have to use the time clock is a violation of internal control in: *

Supervision

Accounting records

Transaction authorization

Not a violation of internal control

If the company hired an external auditor to check on Karim's work, this would be: *

Preventive control

Detective control

Corrective control

None of the answers

The following action by Karim controlled all payment checks to the credit card company. is a violation of internal control in: *

Independent verification

Accounting records

Access control

None of the answers

The fraud would be considered as: *

Asset misappropriation

Bribery

Economic Extortion

Fraudulent statements

The following action by Karim writing checks payable to himself, but he would write a regular recurring vendor's name on each check into the computer system is a violation of internal control in: *

Transaction authorization

Accounting records

Access control

Not a violation of internal control