A company is concerned with the theft of cash after the sale has been recorded. One way in which fraudsters conceal the theft is by a process called "lapping." Which of the following best describes lapping?
A) reduce the customer's account by recording a sales return
B) write off the customer's account
C) apply the payment from another customer to the customer's account
D) reduce the customer's account by recording a sales allowance

Question

Quizplus · Accepted Answer

Lapping is the process of applying a payment from one customer's account to another customer's account to conceal the theft of cash. This creates a delay in the reconciliation process and the fraudster may continue the process by using the next customer's payment to cover the previous customer's account. Eventually, the fraud may be discovered when a customer complains about a missing payment, or when the accounts cannot be reconciled.

A Company Is Concerned with the Theft of Cash After