EJ Retail Store, a regional public company, hires you, a forensic accounting services professional (AICPA 2019, SSFS No. 1; IIA, AICPA, and ACFE 2008; NIJ 2007) at F & K CPAs, to investigate possible thefts of cash. The store supervisor, Robert Canyon, laments, “Some of our employees are probably stealing cash from the cash registers, thinking the company doesn't pay them enough and that everyone else is stealing from the company, too. Please find evidence, so we can know what is happening here!” Your objective is to investigate possible thefts of cash, including cash stolen after it was recorded as revenue by EJ Retail Store's accounting system. You can specifically look for phony Sales Discounts, Sales Refunds, and Sales Voids. For example, an employee may tell a customer that his or her cash register is not working, write a manual receipt indicating full price for the...
Cash Theft Investigation and Evidence Documentation
We gratefully acknowledge Zabihollah Rezaee (editor), our associate editor, and two anonymous reviewers for their valuable comments and suggestions. We also thank participants at the 2016 AAA Annual Meeting in New York and the 2017 AAA Annual Meeting in San Diego for helping to improve earlier versions of this case titled, “A Case on Audit Sampling Documentation and Fraud Detection.”
We dedicate this instructional resource to the memory of our mentor and colleague, Harriet Blodgett.
Freddie Choo, San Francisco State University, Lam Family School of Business, Accounting Department, San Francisco, CA, USA; Kim B. Tan, California State University, Stanislaus, College of Business Administration, Accounting Department, Turlock, CA, USA.
Please do not make the Teaching Notes available to students or post them on websites.
Supplemental material can be accessed by clicking the links in Appendix A.
Editor's note: Accepted by Graham Gal.
Freddie Choo, Kim B. Tan; Cash Theft Investigation and Evidence Documentation. Journal of Forensic Accounting Research Teaching Notes 1 December 2022; 7 (1): 1–25. https://doi.org/10.2308/JFAR-2019-507tn
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