Essay on Preventing Fraud - A check signer's responsibility

1621 Words 7 Pages
Over the past fifteen years the accounting profession has been hit with a number of scandals. Many of the accounting scandals were due to the attitudes and actions of some of the top executives at some of the largest accounting firms and financial institutions. Their actions led to company closures, clients enduring difficulties and stock market failures. The profession which was once known as a highly trustworthy profession has had their ethical, technical and moral standards questioned. Many of the scandals led to changes in the profession. “In 2002 President George W. Bush signed into law the Sarbanes Oxley Bill, which imposes a number of corporate governance rules on public traded companies (Duggan, 2008). The act passed by Congress …show more content…
For example, someone could be pressuring you into misrepresenting facts, compile reports that are misleading or a material misstatement of generally accepted accounting principles. While working within the day-today operations of the company, you may be presented with a check request along with supporting documentation requiring you to sign as a primary or secondary signatory. The following illustrates a scenario in which you may be faced with: You recently moved to a prominent city for vacationers in hopes of furthering your career after graduating from the University of North Texas at Dallas (UNTD), and upon successfully passing of the Certified Public Accountants (CPAs) exam. After months of searching you finally secure gainful employment as a CPA at a local family-owned hotel. The day-to-day management decisions and operations of the business were mainly decided by Jack and Jill, who are brother and sister. Two weeks into the 90-day probationary period, you discover the company has been facing financial difficulties, which includes the possibility of foreclosure of the hotel. Meanwhile, a deal had been struck with the bank to modify the loan documents and with their securing an equity line-of-credit account to help ease some of the family’s financial pressures. As the company’s CPA, you have been given the “authority” to sign checks ranging from $1 - $5,000 as a primary signatory,

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