Term
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Definition
| Schemes in which an employee steals an asset without attempting to conceal the theft in the organization's books and records |
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Term
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Definition
| A method used to conceal the theft of non-cash assets by justifying their absence on the books. Stolen items are removed from the accounting system by being classified as scrap, lost or destroyed, damaged, being bad debt, scrap shrinkage, discount and allowances, returns, etc |
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Term
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Definition
Which of the following is not a type of noncash misappropriation scheme?
a) misuse
b) overbilling
c) unconcealed larceny
d) asset requisitions
e) purchasing and receiving schemes |
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Term
| c) Although the company tried to prosecute Gunter and his girlfriend's father, Thurman, they could not prove that the two had worked together to make a profit on the stolen computer chips (p 213) |
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Definition
Which of the following is not true in relation to the case study, "Chipping Away at High-Tech Theft"?
a) Larry Gunter stole computer chips from his business and gave them to his girlfriend's father to sell
b) Gunter was easily able to steal the merchandise because of flaws in the security system
c) Although the company tried to prosecute Gunter and his girlfriend's father, Thurman, they could not prove that the two had worked together to make a profit on the stolen computer chips
d) An inventory manager was the first to notice the missing computer chips
e) Gunter and Thurman were charged with grand theft and embezzlement |
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Term
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Definition
Physical assets, including inventory and equipment, were the most commonly misappropriated noncash asset
a) True
b) False |
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Term
| b) False (p 213), securities were the least likely asset to be misappropriated, but the median loss was significantly higher than other categories |
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Definition
The misappropriation of securities is one of the more commonly misappropriated assets with a small median loss in relation to other misappropriations
a) True
b) False |
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Term
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Definition
Employees that steal inventory and other assets often do so in plain sight.
a) true
b) false |
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Term
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Definition
One of the ways employees misappropriate assets includes "the fake sale"
a) true
b) false |
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Term
| e) a) and b) only (p 219) |
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Definition
Which of the following is correct in relation to preventing and detecting larceny of noncash assets?
a) the duties of requisitioning, purchasing, and receiving assets should be segregated
b) the payables function should be segregated from all purchasing and receiving duties
c)access logs for restricted areas are optional, but are not very useful in preventing larceny of noncash assets
d) b) and c) only
e) a) and b) only |
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Term
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Definition
The difference between purchasing schemes classified as false billings and those classified as noncash misappropriations is that in a false billing scheme, the employee causes the company to purchase unwanted merchandise, while the latter involves the misappropriation of intentionally purchased assets.
a) true
b) false |
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Term
| d) Boucher never confessed to the fraud but was prosecuted and sentenced to make restitution and serve two years of imprisonment (p 225). Boucher did confess |
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Definition
Which of the following statements is not true in relation to the case study, "Hard Drives and Bad Luck"?
a) Swainler' Technology originally suspected that Hargrove's employees stole the missing assets
b) some of the missing drives showed up in a warehouse in Canada
c) Boucher, the marketing manager at Swainler's, had been making phone calls to the warehouse in Canada, which tied him to the crime
d) Boucher never confessed to the fraud but was prosecuted and sentenced to make restitution and serve two years of imprisonment |
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Term
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Definition
| A method of concealing shrinkage that involves changing the perpetual inventory record to match the physical inventory count |
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Term
| a) adjustments to accounts receivable |
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Definition
Which of the following is not a way to conceal inventory shrinkage?
a) adjustments to accounts receivable
b) fictitious sales and accounts receivable
c) altered inventory records
d) physical padding |
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