The following situations are independent of each other:

1.	A company has two retail outlets, North and South. A separate bank account is maintained for

each location. At head office, there are two employees in the accounting department, Stephanie and Nick. Stephanie records all of the accounts payable, issues cheques, and completes the bank reconciliation for the South outlet. Nick completes all of these duties for the North outlet.

2.	A law firm has three partners and eight employees who provide legal services to clients, and

two administrative staff. When a case is completed, an invoice is supposed to be issued by "whoever has time to do it."

3.	An accounting firm completes many personal tax returns in a very short period of time each

April. In order to speed up the process of updating client personal data (address, contact information and so on), the firm has placed a computer terminal in the reception area and ask the clients to enter any relevant changes while waiting for their account manager to see them. The terminal is connected to the main server and a user-friendly screen has been developed to guide the client through the data entry process. The screen can access any client's data simply by typing in the client's surname.

4.	A warehouse operates 24 hours a day. Employees work either an eight- or a twelve-hour shift.

Three managers each work an eight-hour shift. Before leaving at the end of his or her shift, each manager makes a note on a clipboard of which employees were working during that shift. Once a week, someone from payroll gathers all of these notes to use in preparing the hourly employees' payroll cheques.

5.	Marnie is the supervisor of accounting for a small business and has three junior accountants

reporting to her. At the end of every day she reviews her assistants' work and corrects any errors that she observes. She notices that one employee makes the same types of errors repeatedly and she hopes that she is catching and correcting all of the errors because otherwise the manager's financial reports will not be reliable. Instructions For each weakness, describe what could go wrong as a result of the weakness described, state which type of internal control is required to correct the weakness, and describe a recommended control. The first item has been completed for you. Example:

Item	What could go wrong	Type of internal control	Recommendation
1	Stephanie or Nick could (deliberately or accidentally) record and pay incorrect payables, and cover it up when completing the bank reconciliation.	Segregation of duties	Have Stephanie and Nick each prepare the bank reconciliation for the bank account for which the other employee issued the cheques.