Question

Response Questions Part A To C A) Did the City of Dixon have the appropriate internal controls? What elements do you think they fell short in? B) Who should have detected the fraud first? and why? C) Please share your thoughts about information below and what surprised you most about the information below? Information Welcome to Dixon Illinois about an hour and a half west of bustling Chicago but it has the genteel feel of a small town from the Dixon arch, a lucky horseshoe that hangs over the quaint community to the bright white boyhood home of Ronald Reagan. Reagan isn't just Dixon's claim to fame, he's a symbol of the town's virtue over at City Hall generations of Mayors have kept watch over the town and its traditions. That job is now fallen to Jim Burke Dixon's mayor for the past 15 years. If I want to find out what's on the people's minds, I go out go through the Walmait store and I find out before I leave there. What people are thinking about nobody's afraid to share in their opinions, not at all. Mayor Burke may have the office and the title but as everyone knows. It's the treasurer who really runs the town and for more than 20 years. That person was Rita crun well look ing at her Dixon high school yearbook. She looks like she was bom to be a bean-counter. She was a member of the school's young business association and parlayed that into a job at City Hall when she was just a teen soon. She'd be in charge of every municipal penny in Dixon. The farmer's daughter who grew up on a ranch down the road and made good. I could go in and ask her for say some contract with some utility company or something that might have been fifteen years old and just within seconds. She could put her hands right on it. She knew where everything was at. She had your trust in your confidence. Yeah, she did. Kathy Swanson, the town clerk considered Rita, her mentor. Everybody loved Rita. She had a pretty smile. She knew her job, people trusted her. She would say to the commissioner don't worry boss. I'll take care of that and we grew to trust her. When Rita took over Dixon's books, the town was running a healthy surplus. Slowly a mysterious, downturn set in and finances got tighter and no one could get a red cent from Rita. She illustrated her budget reports with cartoons to make sure everyone got the message. She told the police to stretch every dollar. she told the fire department Dixon was drowning in debt. The financial outlook downright scary. There was no money to pay the ruddy streets. Rita would only allow a few potholes to be filled. So how many people have working for you now. Six and that but that's gone down over time. There at one time there was four King streets Commissioner Jeff Koons said his trucks were rusting to bits so he asked Rita for money to replace them never. We never got it to work the best I could ever get was four tires for an in loader otherwise I got no new equipment the whole time. She was here. All I got was tires even the dead couldn't escape the wrath of Rita. She raided the maintenance budget for the town cemetery to pay other bills, new money sure when hell freezes over. Other bills new money freezes over, were you worried about the future of the city? Absolutely. Rita knew everything about the town's finances but most people knew little about her. She kept to herself and rarely socialized with co-workers including the Mayor, who should known for 40 years. She was always friendly but there was always kind of an invisible shield at least. I felt between me and Rita. There was just a shield you

Answer 1

A) The City of Dixon did not have any internal controls. I think they should have MIS system in place on daily basis to keep control that where money is used and what are inflows vs outflows. so that fund can be used approprately. There should be decentralised authority inspite of centralised authory system as the same was given to Rita wrongly. There should be internal audit of the finacial records and audit report to be submitted to Mayor directly.

B) Mayor should detect the fraud first as he was the responsible and was heading the city since long and should have known what are finacial situations of the city.

C) I am surprised that only one person was delegated all the authority and ther was no check and balances.