Jane works for Middle Co.She is responsible for opening the mail and preparing the bank deposit for cheques received,which she then gives to the owner.After the owner has deposited the cash,he gives Jane the stamped bank deposit slip,which she uses to record the cash received in the accounts receivable records.How does this allocation of responsibilities affect the audit process?

Question

Quizplus · Accepted Answer

The allocation of responsibilities presents a risk of material fraud because Jane has control over both the receipt and recording of cash, which could allow her to misappropriate funds without detection.

Jane Works for Middle Co