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Waren Sports Supply is assessed to have an accounting information system that is 90% reliable. However, there is a 10% chance that a major threat
Waren Sports Supply is assessed to have an accounting information system that is 90% reliable. However, there is a 10% chance that a major threat in the procurement process would result in a potential loss of $300,000 (e.g., Nancy Ford runs off with 10 pallets of basketballs). Management (i.e., Ray Kramer) has identified two control procedures to mitigate the threat. Implementation of control A would cost $18,000 and reduce the risk to 4%. Implementation of control B would cost $10,000
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