Question

Bob Marwell is the controller for the Wascoo waste manage-ment company in Chicago. Wascoo is a small company that collects waste products from offices that want a higher level of security for their waste products. To this end, all Wascoo waste collection trucks have built- in shredders and waste bins with locked doors to prevent unauthorized individuals from even seeing inside them. Bob supervises two bookkeepers and an assistant. The assistant collects the incoming customer payments on account and keeps her work segregated from the two book-keepers. In reviewing the monthly bank reconciliations and cash receipts records, Bob notices that collections have dropped from the usual $ 250,000 per month to $ 195,000. Upon further investigation, he finds many strange and unexplainable entries into the cash receipts journal. He also finds that the bank deposit records are incomplete. It did not take Bob long to figure out that one of the two bookkeepers was in collusion with the assistant, and they had somehow embezzled about $ 55,000 over the last month. Bob went straight to the office of Barbara Enton, the CEO and sole owner of the company. “I want them to go to jail,” she said. “I’ve got some really strong proof,” he replied, handing her several deposit slips. “I found these deposit slips that were obviously forged, and my assistant’s handwriting on them is obvious, since she writes in such a funny way. There’s no way they are going to get out of this.”
Barbara stormed down to the assistant’s office and neatly laid three of the forged deposit slips on the assistant’s desk. “I hope you can explain these,” said Barbara. “Explain what?” replied the assistant. “We’ve short $ 55,000 and your handwriting is on these forged deposit slips,” said Barbara. The assistant was silent for a moment and then said, “I’m calling my lawyer, and I’m going to sue you for embarrassing me like this.” The assistant then stood up quietly and walked straight toward the front door of the building.

Required
What, if anything should have been done differently in this situation?



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  • CreatedFebruary 26, 2015
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