The accounts receivable clerk destroys all invoices for sales made to family and friends and does not record the sales in the accounts receivable subsidiary ledgers.The family and friends usually give the clerk cash as a "thank you." Which procedure will not prevent or detect this fraud?

Question

Quizplus · Accepted Answer

Sending monthly statements will not prevent or detect this fraud because the clerk is destroying the invoices and not recording the sales in the accounts receivable subsidiary ledgers. Monthly statements will only show balances owed by customers who were billed and recorded in the subsidiary ledgers, but not those who were excluded by the clerk. Therefore, this control is ineffective in detecting or preventing this fraud. The other choices are all valid controls that can help prevent or detect this fraud, by ensuring that all sales invoices are properly recorded, numbered, and reconciled to the subsidiary ledgers or the control account.

The Accounts Receivable Clerk Destroys All Invoices for Sales Made