Lee runs a fruit stall at the local market and at the end of each day he banks the cash in the cash register. The cash register records each sale and can provide a total for each day but Lee believes that often the staff are too busy and do not always enter the sales in the register but simply put the cash in the till. The total from the cash register is produced each month for the business’s accountant to prepare financial statements. Recently, Lee employed a university student to work on weekends and he is concerned that soon after this the daily amount banked seems to have decreased even though Lee feels that sales have not really changed. The student often talks about how he spends his evenings at the casino in the hope of winning enough to pay for his university studies so that he doesn’t have to work every weekend.

Required

A. Explain to Lee what controls he could put in place to minimise the risk of one of his employees stealing cash.

B. After Lee put the controls you suggested in place he found that for the first week the cash register showed sales of $7150, including GST, and the amount banked was $6800. Record the cash short or over.

C. The second week after the new controls were implemented the student resigned and the cash register showed sales of $6930, including GST, and the amount banked was $7200. Record the cash short or over.