1. Introduction
Barry owns a motel and café in Solana beach. He hired a couple to run the daily operation of the Solana Motel and Café. Barry is only able to visit the motel and café periodically, he is afraid of internal fraud. He wants help with implementing internal control systems in order to prevent or detect fraud. In the next parts we will discuss the main concerns in the motel and café and suggest internal control systems to Barry to tackle these.

2. Motel Business
The biggest concern in the motel business is that the couple (employees) Barry hired, to run the daily operation of the Solana Motel and Cafe, is both in charge of receiving money and depositing money. This leaves a high opportunity to commit fraud. For example, the couple could not record the payment received from the customer, so it will not be noticed when this money is not deposited at the bank. Moreover, they are in charge of the records of the rooms rented. They could indicate that the room is not rented, while the room actually is rented and keep the payment. This will not be noticed because the payment is not recorded.

The best way to counter these problems would be in the case where different tasks are performed by different people. However, in the case of Solana Motel and Cafe segregation of duties would be very costly, because it is a relatively small firm and they only have a few employees. Segregation of duties in larger hotels will be discussed more extensively in the last section. In order to control the couple, Barry could implement an automated system, in which customers can check–in online, so that Barry can keep track of all the rented rooms and compare this to the cash inflow. In this way the recording of the rooms is automated and cannot be manipulated by employees. These automated systems will be cost-effective in the long run and it might lead to increase in