What control procedure of a business's system of internal control is violated in this situation?
The ticket seller at a movie theater doubles as a ticket taker for a few minutes each day while the ticket taker is on break.
1 Answer | Add Yours
One of the ways of controlling dishonest practices in an organization is to divide the jobs in such a way that an employee will find it difficult to commit dishonest acts without colluding with one or more other employees. This method of controlling dishonesty assumes that need for collusion between more than one employees increases the risk of detection for each employee, thereby discouraging dishonest practice. Also when dishonest acts require collusion between more than one employee, the commitment of dishonest act involves the additional activity and risk of forming the collusion relationship.
In the case cited above this principle of control appears to be violated. When the ticket seller and ticket checker are two different persons, the ticket checker will find it more difficult to admit a person in the movie theater and let him occupy a seat, because if subsequently the ticket seller sells tickets for the seats occupied by the person without the tickets, this dishonest act will become known to others in the organization. However if the ticket checker acts as a ticket seller even for a short period in a day, it will be easier to manipulate the system so that seat assigned to a person admitted without ticket is not sold to anyone else.
We’ve answered 319,865 questions. We can answer yours, too.Ask a question