Answer the following questions 1. Chapter 7 of the Albrecht text includes an example of a manufacturing firm that had problems with employee theft of tools. The company decided that it would search every employee’s lunch box at the end of each shift. The results were that the employees were enraged and caused a work slowdown. How could the company have investigated this theft effectively without causing morale problems with employees? 2. A serious topic like fraud examination could use a little humor so let’s take a look at a short case in chapter 8 with Curly, Larry, and Moe. Marlin Company has suspected something “fishy” for several months. It noticed that its profits have been slowly decreasing, at the same time that revenues increased. After consulting with you, a fraud expert, the company has decided to investigate the purchasing patterns of its three purchasing agents - Curly, Larry, and Moe. You decide that a good method for investigating into the matter is examining a random sample of purchase invoices and verifying their accuracy and validity. Curly’s invoices are numbered 0000 through 0999, Larry’s are 1000 through 1999, and Moe’s are 2000 through 2999. When you approach Curly, Larry, and Moe, they seem somewhat defensive. They begin to harass one another, blaming each other for the mess they are involved in. Moe even twitches their noses and slaps their heads. Curly attempts to retaliate by poking Moe in the eye, but missed and hit Larry instead. When the three were done, the CFO, Mr. Rutin-Tutin exclaimed, “Would you three stooges quit fooling around and produce the invoices immediately?” The three shuffled off to their offices, grumbling all along the way. They returned a couple of hours later with photocopies of their invoices. When Mr. Rutin-Tutin asked where the original invoices were, they explained that they always copy and destroy the originals for easier storing purposes. Rather annoyed and fed up with the three morons, Mr. Rutin-Tutin hands you the stacks of photocopied invoices and tells you to do your thing. What is wrong with this picture? What red flags do you see? Are you suspicious of a fraud here? Why? What is a possible first step in verifying the invoices? .

1. Answer the following questions
1.
Chapter 7 of the Albrecht text includes an example of a
manufacturing firm that had problems with employee theft of
tools. The company decided that it would search every
employee’s lunch box at the end of each shift. The results were
that the employees were enraged and caused a work slowdown.
How could the company have investigated this theft effectively
without causing morale problems with employees?
2.
A serious topic like fraud examination could use a little humor
so let’s take a look at a short case in chapter 8 with Curly,
Larry, and Moe.
Marlin Company has suspected something “fishy” for several
months. It noticed that its profits have been slowly decreasing,
at the same time that revenues increased. After consulting with
you, a fraud expert, the company has decided to investigate the
purchasing patterns of its three purchasing agents - Curly,
Larry, and Moe. You decide that a good method for
investigating into the matter is examining a random sample of
purchase invoices and verifying their accuracy and validity.
Curly’s invoices are numbered 0000 through 0999, Larry’s are
1000 through 1999, and Moe’s are 2000 through 2999. When
you approach Curly, Larry, and Moe, they seem somewhat
defensive. They begin to harass one another, blaming each other
for the mess they are involved in. Moe even twitches their noses
and slaps their heads. Curly attempts to retaliate by poking Moe
in the eye, but missed and hit Larry instead. When the three

2. were done, the CFO, Mr. Rutin-Tutin exclaimed, “Would you
three stooges quit fooling around and produce the invoices
immediately?”
The three shuffled off to their offices, grumbling all along the
way. They returned a couple of hours later with photocopies of
their invoices. When Mr. Rutin-Tutin asked where the original
invoices were, they explained that they always copy and destroy
the originals for easier storing purposes. Rather annoyed and
fed up with the three morons, Mr. Rutin-Tutin hands you the
stacks of photocopied invoices and tells you to do your thing.
What is wrong with this picture? What red flags do you see?
Are you suspicious of a fraud here? Why? What is a possible
first step in verifying the invoices?