The City of Brooklyn Parks and Recreation Department operates three community swimming pools. Each pool has a concession stand that sells candy. Each concession stand is staffed with two workers.

To be eligible for volume discounts, the Parks and Recreation Department orders the candy for all (3) three pools. Kathy Walls is responsible for ordering the concession stand goodies. Kathy uses a locked closet down the hall from her office at the Parks and Recreation headquarters to store the candy. She checks the closet periodically, and, when supplies seem low, she orders more.

Whenever a concession stand needs to restock inventory, a worker goes to the Parks and Recreation headquarters to get the needed candy. Because Kathy knows all of the concession workers, she usually just hands the worker the key to the candy closet so the worker can get whatever is needed. Kathy has attached a chart to the closet door to keep track of candy withdrawals. On that chart, each worker records the number of boxes of candy that he or she is taking and the pool to which it is going.

By the end of the summer, Kathy becomes worried that someone else has a key to the candy closet. The candy seems to be disappearing more quickly than it did at the beginning of the summer. For the last month or so, she hasn't found time to compare the withdrawals on her chart with candy purchases, but something just doesnt seem right.

Questions:

(1) Please identify the control problems, and suggest how to correct the inappropriate inventory procedures being used.

(2) (This question is a NOT related to the above Passage) Why differences exist between the Bank Balance and the Book Balance of the checking account?