Question

Describe how larceny schemes are committed. Please provide 3 examples of prevention methods organizations can use to prevent larceny schemes. Provide 3 examples of tools forensic accountants can use to detect larceny schemes? TTT Arial 3 (12pt) T E 35

Answer 1

Larceny is an internal fraud. It is committed or done by the employees within the organisation. This fraud is mainly known as cash larceny. Cash larceny is a fraud in which the employees steals cash from the organisation after it has been recorded on the books of accounts of the organisation. It is usually done by the employees in the way of stealing cash from the register, reversing certain cash transactions by decreasing the amount of cash balance, destroying registers etc....

The organisation can prevent cash larceny by way of maintaining proper books of accounts. It has to prepare bank reconciliation statement. Organisation should not give control over the entire accounting transactions to the employees. It should done surprise visits. It means the organisation has to done surprise checking and auditing of books of accounts. There should be rotation of duties or assignments to the employees. There should be effective internal and external audit.