Accounting: Tools for Business Decision Making, 5th Edition

Published by Wiley
ISBN 10: 1118128168
ISBN 13: 978-1-11812-816-9

Chapter 7 - Fraud, Internal Control, and Cash - Questions: 13

Answer

Human resource department can help in institution of Internal control system by following ways: 1) Bond employees who handle cash - Bonding involves obtaining insurance protection against theft by employees. 2) Rotate employee's duties and require employees to take vacations. 3) Conduct through background checks.

Work Step by Step

1)It helps in safeguarding in two ways - First the insurance company will carefully screen all individuals before adding them to the policy and - Secondly the employees know that insurance company will prosecute all offenders. 2) This will deter employees from attempting thefts since they will not be able to conceal for a longer duration. 3) HR department can help the company to reduce the theft and fraud by conducting background checks.
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