CIMA Risk Management P3 Question # 47 Topic 5 Discussion

CIMA Risk Management P3 Question # 47 Topic 5 Discussion

P3 Exam Topic 5 Question 47 Discussion:
Question #: 47
Topic #: 5

TT is a jewellery manufacturer in country A It makes jewellery from precious metals and stones and sells it to shops in country A and also overseas It is the 3rd largest company in country A with a huge turnover

TT has found it very difficult to prevent staff committing fraud and last year the Board was sure that the year end inventory was lower than it should have been Gross profit was also slightly lower than expected

Which TWO of the following internal controls would be most effective in helping to reduce staff fraud within TT?


A.

Carry out inventory checks daily to make sure the correct quantity of materials is being used every day and the correct number of items are being produced


B.

Employ two more managers to watch the staff working and look for them stealing items


C.

Have a senior manager such as the Production Director to supervise the workshop at all times


D.

Install-several CCTV cameras in the workshop


E.

Perform random checks of staff bags as they leave work and ensure the staff all wear overalls provided by the company in the workshop Their own clothes must be left in lockers during working hours


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