You have recently taken over the role of the Chief Financial Officer of GT Gold Chasers...
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You have recently taken over the role of the Chief Financial Officer of GT Gold Chasers Ltd. ("GT Gold"). GT Gold is junior mining company, that is hoping to hit it big with their next mining venture. You work out of the head office that is based out of Vancouver. GT has got a reputation in the industry for being quick to act, and the management team are known for pushing the envelope to get results. There has been a high turnover of people in the last two years, and the current team are mainly new to the job. During your first few weeks on the job, you have noticed a few "oddities" around how things in the office run. A couple of examples of these are as follows: • Your assistant staff accountant, Stella Monibag helps you with the preparation of the accounting financial statements for the company. Stella spends her days reconciling the bank accounts of the company on a daily basis, which is great, because you need to know how much cash you have in the company at all times. Once she has reconciled the accounting general ledger to the bank statement, she prepares all the cheques for the new bills that needs to be paid. You have the authority to sign the cheques, but when you are out of the office, Stella is also able to sign these cheques or approve payments on your behalf. Stella keeps the cheque book on her desk so that she doesn't lose it easily. Once you have approved a payment, Stella will access the company accounting system to enter the transactions in the general ledger. • Recently the company started to pay some larger invoices to vendors that you have never really heard of. One the vendors, SM Consultants Inc. provided printing services, a piece of furniture and six hours of printing consulting. These were not expected costs, but you are new to the office, and you figure that it will probably sort itself out later. 2.a) Please advise provides commentary on any internal control weaknesses that may exist in GT Gold, based on the above information (12 marks). 2.b) Please provide three possible solutions to the internal control weaknesses you have identified above, and how these will help solve the control weakness (6 marks). 2.c) Provide some commentary and two examples regarding things you would try to change in the organization to address internal control risk (hint: refer back to the Fraud Triangle model discussed during class), and how these changes would impact the company (4 marks). You have recently taken over the role of the Chief Financial Officer of GT Gold Chasers Ltd. ("GT Gold"). GT Gold is junior mining company, that is hoping to hit it big with their next mining venture. You work out of the head office that is based out of Vancouver. GT has got a reputation in the industry for being quick to act, and the management team are known for pushing the envelope to get results. There has been a high turnover of people in the last two years, and the current team are mainly new to the job. During your first few weeks on the job, you have noticed a few "oddities" around how things in the office run. A couple of examples of these are as follows: • Your assistant staff accountant, Stella Monibag helps you with the preparation of the accounting financial statements for the company. Stella spends her days reconciling the bank accounts of the company on a daily basis, which is great, because you need to know how much cash you have in the company at all times. Once she has reconciled the accounting general ledger to the bank statement, she prepares all the cheques for the new bills that needs to be paid. You have the authority to sign the cheques, but when you are out of the office, Stella is also able to sign these cheques or approve payments on your behalf. Stella keeps the cheque book on her desk so that she doesn't lose it easily. Once you have approved a payment, Stella will access the company accounting system to enter the transactions in the general ledger. • Recently the company started to pay some larger invoices to vendors that you have never really heard of. One the vendors, SM Consultants Inc. provided printing services, a piece of furniture and six hours of printing consulting. These were not expected costs, but you are new to the office, and you figure that it will probably sort itself out later. 2.a) Please advise provides commentary on any internal control weaknesses that may exist in GT Gold, based on the above information (12 marks). 2.b) Please provide three possible solutions to the internal control weaknesses you have identified above, and how these will help solve the control weakness (6 marks). 2.c) Provide some commentary and two examples regarding things you would try to change in the organization to address internal control risk (hint: refer back to the Fraud Triangle model discussed during class), and how these changes would impact the company (4 marks).
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Answer rating: 100% (QA)
Facts of the Event Internal Control Weakness Solution Here In this case L1 officer Stella Miantaining Bank Reconciliation on daily basis Cheques need ... View the full answer
Related Book For
Financial and Managerial Accounting the basis for business decisions
ISBN: 978-0078111044
16th edition
Authors: Jan Williams, Susan Haka, Mark Bettner, Joseph Carcello
Posted Date:
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