This illustration is known as the Fraud Tree and depicts various ways an employee can misappropriate assets. Notice there are three main ways employees can embezzle cash: skimming, larceny, and fraudulent disbursements. Pick one of the boxes under Cash and explain how an employee would embezzle money under this scheme. What internal controls can management put into place to prevent this type of embezzlement?

The Fraud Tree Asset misappropriation Inventory and all other assets Cash Larceny Larceny Skimming Misuse Asset requisltions and transfers of cash on hand Refunds and other Sales Recelvables False sales and shipping Write-off schemes From the deposit Unrecorded Purchasing and receiving Understated Other schemes Unconcealed Unconcealed larceny Fraudulent disbursements Expense reimbursement schemes Billing schemes Payroll schemes Reglster disbursements Check tampering Shell company Ghost employees Mischaracterized expenses Forged maker False volds Non- accomplice vendor Forged endorsement Commission schemes Overstated expenses False refunds Workers' compensation Personal purchases Fictitious Altered yee expenses Falsified wages Multiple relmbursements Concealed checks Authorized maker