Question

Sasha Johnson is a worker at a local 24-hour pharmacy. Sasha works the night shift and is the only worker. Because management is cost-conscious and business is slow at night, Sasha has been given the responsibility to do the accounting from the previous day. Sasha has two children, and her husband does not work. Sasha has strong pressure to provide well for her family.

1. Is the pharmacy at risk for fraud? Why or why not.

2. Assuming you were recently hired by the pharmacy as a business consultant, what information would you provide to the owner of the pharmacy concerning fraud?

Answer 1

1. The pharmacy is at a risk of fraud. A crucial leg driving the intent of fraud is motive. Since Sasha has responsibilities to fulfill and is not in a good place financially, she has the motive to embezzle the funds of the company and convert them for personal use.

The second important aspect of fraud is opportunity. Since Sasha is the only worker at night, and is given accounting work, she can pilfer cash from the company and manipulate the accounting records.

Since motive and opportunity are both present, the pharmacy is at a risk of fraud.

2. If I was hired as a business consultant by the pharmacy, I would first educate them on the fraud driving factors. Later, I would tell them to intoduce the maker checker concept which does not exist in the pharmacy right now.

Further, I would also suggest that even though the company is conscious about cost and wants the same employee to execute all types of work, this kind of dependece could turn into a heavy cost for the company if a fraud occurs. The company should instead hire an employee for accounting purposes.