Cash Assets

Thoroughly Read and Examine the Case • Highlight relevant facts and key problems. Analysis of Case • Identify key problems and why they exist. • How do the identified problems affect the organization? • Who is responsible for the impact of these problems to the organization? Case Solution • What are the areas of opportunity for change? • Utilize additional research in conjunction with the text, and your own experiences (if applicable). • Ensure the solution is realistic. Draft the Case • Once the necessary information has been compiled, draft your case response in complete paragraphs (three to five sentences each) with the entire case response being at a minimum of 350 words in length (excluding the cover and reference page). • It is NOT required that you retype the case provided in the text. However, if you do, it will NOT count toward the minimum of 350 words. Case 5-2 Internal Controls The following is an excerpt from a conversation between two sales clerks, Tracy Rawlin and Jeff Weimer. Both Tracy and Jeff are employed by Magnum Electronics, a locally owned and operated electronics retail store. Tracy: Did you hear the news? Jeff: What news? Tracy: Bridget and Ken were both arrested this morning. Jeff: What? Arrested? You’re putting me on! Tracy: No, really! The police arrested them first thing this morning. Put them in handcuffs, read them their rights—the whole works. It was unreal! Jeff: What did they do? Tracy: Well, apparently they were filling out merchandise refund forms for fictitious customers and then taking the cash. Jeff: I guess I never thought of that. How did they catch them? Tracy: The store manager noticed that returns were twice that of last year and seemed to be increasing. When he confronted Bridget, she became flustered and admitted to taking the cash, apparently over $15,000 in just three months. They’re going over the last six months’ transactions to try to determine how much Ken stole. He apparently started stealing first. Suggest appropriate control procedures that would have prevented or detected the theft of cash.