F1 Test Ch 9-11

Teeming and lading refers to a fraudulent activity where funds are siphoned off by an employee before they are recorded in the company's books. This typically occurs in the sales department where there is a high volume of transactions and cash handling. By manipulating sales records, an employee can divert funds for personal gain without being detected. Therefore, sales is the most likely area of operation where teeming and lading would occur.

Mohammad should delegate more tasks to his staff in order to alleviate his workload. By delegating tasks, he can distribute the workload among his team members and utilize their capabilities effectively. This will not only help him in managing his own work more efficiently but also provide opportunities for his staff to develop their skills and take on more responsibilities. Planning further ahead may be helpful in some cases, but it might not address the immediate issue of piled-up work. Working longer hours is not a sustainable solution and may lead to burnout. Therefore, delegating tasks is the most appropriate course of action for Mohammad.

The word "autocratic" correctly completes the sentence. An autocratic leadership style is characterized by a leader who makes decisions without consulting or considering the input of subordinates. This style does not acknowledge or value the contributions that subordinates have to make, as the leader maintains full control and authority over decision-making.

Elton Mayo's human relations approach to management emphasizes the importance of recognizing and satisfying the social and psychological needs of employees. According to Mayo, work satisfaction is not solely driven by monetary rewards but is also influenced by factors such as recognition, security, and being part of a team. This approach highlights the significance of creating a positive work environment that fosters good communication, emotional connection, and teamwork in order to enhance productivity and employee satisfaction.

Audit trails are not a method of data validation. Audit trails are used to track and record any changes made to data, providing a history of who accessed or modified the data. Data validation methods, on the other hand, are used to ensure the accuracy and integrity of data, such as range checks, control totals, and limit checks.

In order for fraud to occur in circumstances where duties are not segregated, two prerequisites are necessary. Dishonesty is one of the prerequisites as it involves intentionally deceiving or misleading others for personal gain. Motivation is the other prerequisite as it provides the incentive or drive for someone to engage in fraudulent activities. Collaboration and collusion, while often associated with fraud, are not prerequisites in this specific scenario where duties are not segregated.

Expensive lifestyles are not an example of a business risk that may indicate potential fraud. While complex structure, market opinion, and profit levels deviating from the norm can all be indicators of potential fraud, expensive lifestyles do not necessarily indicate fraudulent activity. While they may suggest excessive spending or personal financial mismanagement, they do not directly relate to fraudulent behavior within a business context.

According to Kotter, leadership is primarily about change. This means that leaders are responsible for driving and facilitating change within an organization or a team. They need to have the ability to identify the need for change, communicate it effectively, and guide others through the process of implementing and adapting to the change. Leadership involves inspiring and motivating others to embrace change and helping them navigate through the challenges and uncertainties that come with it. By focusing on change, leaders can create a culture of continuous improvement and innovation within their organizations.

The statement is true because internal audit is a function within a company that is responsible for evaluating and assessing the financial and operating systems. The internal audit team reports its findings and recommendations to the management of the company, providing them with valuable insights and helping to improve the overall efficiency and effectiveness of the organization.

Ben is responsible for conducting internal checks and preparing a pre-list and control totals as part of his role. A pre-list is a list of items or tasks that need to be completed or checked, which helps in organizing and prioritizing the work. Control totals are the sum or total of a set of numbers or values, which are used to ensure accuracy and completeness in financial or operational processes. By preparing these two, Ben can effectively manage and monitor the internal checks and ensure that all necessary tasks are completed accurately.

Based on the given information, Bob purchases only 20% of Company A's output and maintains competition between suppliers. This suggests that Bob does not have a high level of power over Company A. However, Bob's high interest in Company A's output indicates that he is highly interested in the success and performance of the company. Therefore, Bob should be categorized as having low power but high interest according to Mendelow's framework.

Jim has been asked to perform an operational audit. This type of audit focuses on evaluating the effectiveness and efficiency of an organization's operations, including its policies and procedures. In this case, Jim is specifically examining the policies of the purchasing department to determine if they are adequate and working effectively. This type of audit helps management identify areas for improvement and make informed decisions to enhance the overall performance of the organization.

Fictitious sales involve deliberately creating false sales transactions in order to deceive others. This type of fraud is an intentional misrepresentation because it involves intentionally presenting false information about sales that did not actually occur. It is different from the removal of funds, where the focus is on stealing or embezzling money directly. In fictitious sales, the aim is to deceive others by making them believe that sales have taken place, resulting in financial gain or other benefits for the fraudster.

The type of system being developed is an internal control system. An internal control system is designed to provide reasonable assurance about the reliability of financial reporting. It includes policies, procedures, and processes that are put in place to safeguard company assets, ensure accuracy and completeness of financial records, and promote compliance with laws and regulations. As a director of HH Co., Ahsan's role in overseeing the development of this system would involve implementing controls and monitoring their effectiveness to ensure the reliability of financial reporting.

The 'country club' style of management identified by Blake and Mouton's managerial grid is characterized by a high degree of concern for people and little concern for the task. This style of management emphasizes creating a comfortable and friendly work environment, where the needs and well-being of employees are prioritized over achieving high levels of productivity. Managers who adopt this style tend to be more lenient and forgiving, often overlooking inadequacies and providing support and encouragement to their team members.

The first application control, "Orders over Rs. 10,000 in value are authorized by an executive," ensures that high-value orders are approved by a higher-level authority, reducing the risk of unauthorized purchases or fraud. The second application control, "Sequence checks are made as documents are entered into the system," ensures that all documents are entered in the correct order, preventing any missing or duplicate entries that could lead to errors or discrepancies in the purchasing process.

Philip, as the external auditor, would consider due professional care and technical competence when assessing Andrea's work. Due professional care refers to the level of skill, diligence, and care that a reasonable auditor would exercise in similar circumstances. Philip would assess whether Andrea has performed her duties with the required level of care and professionalism. Technical competence, on the other hand, refers to the auditor's knowledge and understanding of auditing principles and techniques. Philip would assess whether Andrea possesses the necessary technical skills and expertise to perform her role effectively.

Supervision is the best definition for "getting things done through other people" because it involves overseeing and directing the work of others to ensure tasks are completed effectively and efficiently. Supervisors provide guidance, support, and instructions to their subordinates, ensuring that work is carried out according to established standards and goals. They have the authority to make decisions, allocate resources, and hold individuals accountable for their performance. Supervision is a key aspect of management and requires strong communication, interpersonal, and organizational skills to effectively coordinate and motivate a team towards achieving objectives.

Danny, as the accounts manager, is assisting the person who established the legitimate company to retain the benefit of their illegal activities. This falls under the category of "Assisting another to retain the benefit of crime." Additionally, if Danny is aware or has suspicions about the illegal source of funds but fails to disclose this knowledge, he is also guilty of "Failure to disclose knowledge or suspicion of money laundering."

Corporate restructuring and rapid growth are relevant to assessing the internal factors that may increase a company's risk exposure to fraud. Corporate restructuring can lead to changes in processes, systems, and controls, which may create vulnerabilities that can be exploited for fraudulent activities. Rapid growth can also increase the risk of fraud as it may strain resources, create a need for quick decision-making, and result in inadequate oversight and controls. New legislation and increased competition may have an impact on fraud risk, but they are external factors rather than internal factors.

Ed, as the external auditor, is required to detect the extent of fraud and error in the organization. This is an important responsibility of an auditor to identify any fraudulent activities or errors that may have occurred in the financial statements. Additionally, Ed is also required to express an opinion on the true and fair view of the financial statement. This means that he needs to assess the accuracy and reliability of the financial statements and provide an opinion on whether they present a true and fair view of the company's financial position.

A shaper within Belbin's team roles is someone who challenges others to move forward and can be insensitive, aggressive, and cause conflict. This team role is known for pushing the team to achieve their goals and can sometimes be confrontational in their approach. Their focus is on driving progress and may not be as interested in ideas as they are in achieving results. They may exhibit behavior that can be seen as aggressive or conflict-inducing, but this is often necessary to push the team towards success.

External auditors do not verify whether the year-end accounts are completely accurate. Their main objective is to provide an independent and objective assessment of the financial statements to ensure they are presented fairly and in accordance with the applicable financial reporting standards. While auditors perform various tests and procedures to obtain reasonable assurance about the accuracy of the financial statements, they do not guarantee their complete accuracy.

Anna wishes to implement an Internal Check system. Internal Check refers to the process of dividing responsibilities and duties among different individuals to prevent fraud and errors. By ensuring that no one person is responsible for ordering raw materials, receiving them, and authorizing payment, Anna aims to establish a system of checks and balances within the company's financial administration. This will help in detecting and preventing any potential misuse of resources and ensure the accuracy and reliability of financial transactions.