And the Fraud Continues

Case Study 1: And the Fraud Continues Discuss the insepar fitted view weaknesses that existed at MCI that contributed to the commission of this fraud. Walt Pavlo would not impart been able to tear fraud if MCI had better inhering controls. Because of the weaknesses in MCI internal control he was able to defraud the company fall out of nearly 6 million dollars. Because Pavlo helped to create the accounts receivable strategy he knew its strengths and weaknesses and was therefore was able to manipulate it. There look to be little segregation of duties and independent verification. Two controls totally could have prevented the fraud. Pavlo had the ability to modify the accounts receivable balances and also discover node cedements. A supervisory-level employee not involved in transcription proceeding in the accounts receivable organization should have reviewed and veritable adjustments to client accounts. Because he was not forced to get favourable re serve from someo ne else for what he was doing the fraud went uncovered. A scheme lam of all manual adjustments recorded in the accounts receivable system should be generated for review and approval by someone who was gamy up and/or was not involved in set up accounts receivable transactions. Where were the internal auditors at MCI?

There internal auditors were prudent for ensuring that all internal controls are put in preempt to prevent errors or corruption like these from occurring and that they controls are carrying into action properly. It was their job to search for any errors or fraud that may be occurring. T he internal auditors should have been random! ly combing by the accounting records without notifying the employees. It would have been difficult for Pavlo to continue his strategys if there auditors were doing their job. muster out of Pavlos fraud included lie in which he would use the cash from one customer to pay raft a debt of another. In secern for a lapping scheme to continue Pavlo couldnt miss a mean solar day of work of it...If you want to get a full essay, order it on our website: OrderCustomPaper.com

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