Auditing homework

Homework Week 03Instructions 
You are the owner of a privately-owned, small golf course in the city of Butte, Montana.  Your father gave you the land for the golf course over 25 years ago, when the farm he had been operating went out of business. 
The golf course has done well since it was first built and includes a small shop that sells golf equipment, golf accessories, and golf clothing from the major golf manufacturers.  In addition, there is a very small restaurant that serves breakfast and lunch to golfers.   Revenues and profits from the golf course have grown significantly, especially in recent years with the growth of the golf as a sport in Montana.  Your bookkeeping is done by a local accounting firm; they also prepare the annual tax returns for the business. 
The accountant assigned to your account prepares the books and monthly financial statements.  She estimates that the business loses up to 10 percent of its profit each year to internal fraud.  Her estimates are based upon profits and operating margins at other golf courses, which are also her clients.  Fortunately, your business can afford this loss, but perhaps the day will come when the business cannot afford to continue losing money to internal fraud.  All payroll-related functions are outsourced to ADP; you approve all weekly payroll online before checks are written to employees.
The golf course has 4 employees.  One manages the golf shop; one manages the restaurant, and the other two perform the daily maintenance required to operate a golf course during the season.  You have tried to put adequate internal controls in place.  For example, you implemented internal controls for placing orders for supplies required for the golf shop, for the restaurant, and for golf course maintenance. Since you travel often, during your absence you allow the employees to do what is required to keep the business running as smoothly as possible.  Thus, you have given permission for employees to sign checks to pay vendors for purchases. 
In the past, you have caught employees participating in fraudulent activities.  Since Butte is such a small town, you have never pursued prosecution of these fraudsters because you are afraid of the negative publicity it would cause your business and possibly their former employers.
Questions:
1.  Given the scenario above, as the owner of this golf course, what/which aspects of the golf course operations can you change immediately to reduce the amount of fraud that is currently occurring? Address, for example, the following areas (to get you started):
– purchase orders to suppliers
– payments to suppliers
– the monthly operating bank statement and the monthly bank reconciliation for the golf course (which right now is performed by the accountant)
– for the golf shop, maintaining perpetual inventory records
– the use of various types of basic technology within the golf course operations to help control for the risk of fraud.
– check signing authority
– any other areas you can think of, based upon the information provided in this case study
2.  Describe some factors in detail related to creating a culture of honesty within the golf course operation, starting at the beginning.  What are some basic factors or steps you should take with regards to ensuring there is a culture of honesty and integrity within the golf course operation?   You should have 4-5 items explained in detail that you would recommend the owner  implement immediately to stop losses the golf course has suffered due to internal fraud.  Do not repeat any of the items you described in your answer to the first requirement above.
Approximate price: $22
We value our customers and so we ensure that what we do is 100% original..

With us you are guaranteed of quality work done by our qualified experts.Your information and everything that you do with us is kept completely confidential.You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.The Product ordered is guaranteed to be original. Orders are checked by the most advanced anti-plagiarism software in the market to assure that the Product is 100% original. The Company has a zero tolerance policy for plagiarism.The Free Revision policy is a courtesy service that the Company provides to help ensure Customer’s total satisfaction with the completed Order. To receive free revision the Company requires that the Customer provide the request within fourteen (14) days from the first completion date and within a period of thirty (30) days for dissertations.The Company is committed to protect the privacy of the Customer and it will never resell or share any of Customer’s personal information, including credit card data, with any third party. All the online transactions are processed through the secure and reliable online payment systems.By placing an order with us, you agree to the service we provide. We will endear to do all that it takes to deliver a comprehensive paper as per your requirements. We also count on your cooperation to ensure that we deliver on this mandate.