Reference no: EM133239454

After graduating from Rasmussen University, you decide to take your grandma's secret pizza recipe and open up a pizza parlor. You grew up around your father's pizza shop quite a few years ago, and you are eager to start your own business. You are confident that your pizza place will be successful, and maybe you can franchise.

With an entrepreneurial spirit, you take out a business loan for the startup fund, hire several employees, and open a beautiful store you are proud of. After months of hard work and experimentation with new recipes, you are devastated when you learn that your store manager has been stealing from you. One of your recent employees tells you that the manager, Robert, voided a sale of two-dozen pizzas, stamped the receipt as a return, and pocketed the money during her last shift. Robert warned the new hire not to say anything and told her he deserved the money because he didn't get paid enough. Encouraged by your open-door policy, the employee confides in you.

Explain what symptoms this fraud will arise. Which financial statement(s) would be affected? Compare the schemes and implications of the fraud to your revenue and inventory accounts.

Explain the steps you should take to uncover each symptom you identified in part (1). What type of queries or transactions would you undertake to uncover this type of fraud? Explain how they help with the investigation.

After you have identified several symptoms, how do you know that you have enough evidence to prove that Robert is guilty? What other evidence should you obtain in this case? Explain.

Besides finding symptoms of the fraud, what other investigative steps can you take to draw Robert's confession or otherwise prove the fraud?

What steps should you have been taken to prevent this fraud from occurring in the first place?