Midterm Exam Option #2 – A SPACER General Evaluation
Corporate Fraud most likely Scenario
The vision of STAPLES Office Solutions, Inc., a Business company, is to be the leader in providing innovative products and services that enable our customers to manage document workflow and increase efficiency. To facilitate this goal management is responsible for establishing and maintaining an adequate system of internal controls to provide reasonable assurance that the mission and objectives of the organization are achieved. As a Sr. Financial Analyst on the business information team the main fraud risks that affect my position and may impede STAPLES’s ability to reach these objectives are; theft of company property and resources, procurement fraud, and data/information risks. The first of the three, theft of company property and resources doesn’t involve the $100,000 digital duplicators, or the $50,000 multi function printers manufactured by my company. The most widespread problem involving theft at STAPLES involves ink and toner. STAPLES is a world leader in the manufacture and distribution of business information machines and as such we employee thousand of associates who do nothing but service the machines that are placed at our customers locations. While if one of the $100,000 machines would disappear it would take a million dollars in sales to recoup the profits, the opportunity and risk involved with pilfering these two ton, VW sized machines make them an unlikely target. Each, even the smallest, of the base unit machines purchased or leased from our company has a VPN number similar to a VIN number found on any vehicle. Each VPN number is comprised of several smaller numbers derived from and recorded by a computerized program at the plant. The numbers are organized and sequenced based on the base unit and the accessories, like sorters and staplers,