Harriet Knox, Ralph Patton, and Marcia Diamond work
for a family physician, Dr. Gwen Conrad, who is in private
practice. Dr. Conrad is knowledgeable about office management
practices and has segregated the cash receipt duties as follows.
Knox opens the mail and prepares a triplicate list of money
received. She sends one copy of the list to Patton, the cashier,
who deposits the receipts daily in the bank. Diamond, the record
keeper, receives a copy of the list and posts payments to patients’
accounts. About once a month the office clerks have an expensive
lunch they par for as follows. First, Patton endorses a patient’s
check in Dr. Conrad’s name and cashes it at the bank. Knox then
destroys the remittance advice accompanying the check. Finally,
Diamond posts payment to the customer’s account as a miscellaneous
credit. The three justify their actions by their relatively low pay
and knowledge that Dr. Conrad will likely never miss the
money.
RESOURCES
Lecture notes in this module as well as the assigned reading from your text.
REQUIREMENTS
Respond to the following questions in the MODULE 3 Discussion Forum.
RESOURCES
Lecture notes in this module as well as the assigned reading from your text.
REQUIREMENTS
Respond to the following questions in the MODULE 3 Discussion Forum.
Who is the best person in Dr. Conrad’s office to
reconcile the bank statement?
Would a bank reconciliation uncover this office
fraud?
What are some procedures to detect this type of
fraud?
