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Case Analysis 6 - McGrew |1 Trish McGrew Assignment 5-3...

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M c G r e w | 1 Trish McGrew Assignment 5-3 ACCT/BSFR 343 Professor Tricia Bell December 10, 2009 Fraud Case Analysis 6 Provide a brief explanation of the proper business process involved in this case (e.g., document flow, personnel involved, authorization required, etc). Stanley was a creative writer at an advertising firm and his coworker Phoebe processed invoices for payment. The two employees were in collusion in this asset misappropriation of cash, which was a fraudulent disbursement billing scheme involving a shell company. Stanley would print the invoices at home and bill the company for “services performed” as Phoebe instructed. Phoebe would then create a new vendor file along with phony documents and then submit the invoice in with others for payment. Which components of the business process were performed incorrectly? Explain. The person who approved the invoices for payment should have studied the invoices a little better. If that person had done so, they could have detected some irregularities of the fake invoices. In addition, the company should have frequently checked the vendors for authenticity and monitored the frequency of the billing of the vendors. This would be to ensure that the vendors are not billing more than once a month. In addition, when new vendors are added the company should check the address to make sure it does not match any employees’ address.
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