Accounting
Ethically
It is quite obvious after reading the division of responsibility and the
actions of the employees of Dr. Conrad’s office, that there are ethical issues
at play. In light of this, it would be crucial to have the owner of the office, Dr.
Conrad, reconcile the bank statement. According to an article in The Journal
of Medical Practice management, “The physician should always be part of
the process… In small offices where there are fewer employees to handle
the financial aspects, it is very important that the physician participate in the
process” (Weinstock, 2010, para. 15). Knowing that the ‘boss’ will be
involved in the accounting process could prove to be a major deterrent for
the employees’ behavior.
Even though there is a division of responsibilities, which is listed as an
internal control in our text (Wild, Shaw, & Chiappetta, 2013), the employees
are working together to cover their fraud. Ms. Diamond is careful to ensure
that an account is being credited when posting the deposit. This means that
the cash deposits listed from the bank will match deposits in the books, thus
not uncovering the fraud.
Detection of the fraud would probably go unnoticed for quite some
time unless a third party were to get involved. For instance, a cashier at the
bank might think it is strange that Mr. Patton comes in to cash a check from
a patient. The cashier could notify the bank manager, who may then call Dr.
