M Smith was hired to work in the accounts payable area for ABC Company. Smith is responsible for preparing checks, recording cash disbursements, and preparing bank reconciliations. While reconciling the account for October, Smith noticed that several checks totaling $937 had been outstanding for over a year. Smith assumed these checks would probably never be presented for payment and wrote a check to themself for the same amount. They never entered the check into the ledger and dropped the original checks from the outstanding check list. When the paid check came through, Smith destroyed it.

1. List at least two internal controls that should be in place to prevent and/or detect this type of theft.

2. List at least two audit procedures that might detect the fraudulent disbursement.