Question $2$

Helen Weeks has worked for Bonne Consulting Group $($BCG$)$ as the executive

secretary in the administrative department for nearly $10$ years. Her apparent integrity

and dedication to her work has quickly earned her reputation as an outstanding

employee and has resulted in increased responsibilities. Her present responsibilities

include making arrangements for outside feasibility studies, maintaining client files,

working with outside marketing consultants, initiating the payment process, and

notifying the accounting department of all openings or closings of vendor accounts.

During Helen's first five years of employment, BCG subcontracted all of its feasibility

and marketing studies through Jackson & Co$.$ This relationship was subsequently

terminated because Jackson and Co$.$ merged with a larger, more expensive consulting

group. At the time of termination, Helen and her supervisor were forced to select a

new firm to conduct BCG$\text{'}$s market research. However, Helen never informed the

accounting department that Jackson & Co$.$ account had been closed.

Since her supervisor allowed Helen to sign the payment voucher for services

rendered, Helen was able to continue to process checks made payable to Jackson

and Co's account. Because Helen's supervisor completely trusted her, he $($supervisor$)$

allowed Helen to sign for all voucher payments less than $$10,000.$ The accounting

department continued to process the payments. Helen opened a bank account in a

nearby city under the name of Jackson & Co$.,$ where she would make deposit. Helen

paid all her personal expenses out of this account.

Assume that you have recently been hired by BCG to help detect and prevent fraud.

Required:

$($a$)$ What internal control activities are missing in Helen's company

$($b$)$ What gave Helen the opportunity to commit the fraud?

$($c$)$ How could this fraud have been detected?