Invoice and Source Documents

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Case 1

Who is the perpetrator?
From the facts given in the case, it can be clearly deduced that Debbie Jones is the perpetrator. She has access to both assets and accounts which gives her the opportunity to commit and conceal the fraud. Also, she is the one who updates and maintains the accounts receivable records enabling her to tamper with the existing files. Apart from this, fraud occurred 6 months after she started working for the company, and her responses to the inquiries (check stamps, order of payments) were questionable.

How she did it?
One unusual characteristic of the crabmeat industry in the town in Maryland is that the selling price was set at the beginning of the year and all customers order the same quantity of crabmeat; thus, the weekly invoice of each customer was for the same amount. In addition, manual sales invoices which were not pre-numbered were produced when orders were taken. All these business practices allowed the perpetrator to commit lapping. In this situation, Debbie stole the check for one sale and concealed the theft by not recording the preceding sale (this explains why the sales 2 transaction was not found in the computer file.) The stolen check was then stamped with the company’s name and city rather than the usual ‘for deposit only.’ This was done so Debbie could withdraw the cash for herself rather than depositing it to the company account. When the auditor began to question the missing transaction and right after overhearing Susan and the auditor’s conversation, Debbie attempted to correct the A/R file by hastily adding the May 10 payment. To prevent further scrutiny of the records, Debbie caused the crash of the computer 30 seconds later after showing the customer accounts. To make her story more believable, she presented deposit ticket showing the checks listed including the check that the customer said that was sent five minutes later. This deposit ticket was obviously fake because it was not stamped by...
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