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Auditing & Assurance Services, 7e (Louwers)
Chapter 6 Employee Fraud and the Audit of Cash
1) When auditing financial statements and finding indications of a possible misappropriation of

assets, independent auditors should:
A) investigate fully to determine the total amount of the misappropriation.
B) determine which accounts are affected and the amount by which they are overstated or
understated.
C) determine the methods by which the misappropriation was carried out.
D) identify a person(s) who are likely responsible for the misappropriation and obtain evidence
about some other fraud indications in their work.
E) all of these.
Answer: E
Difficulty: 2 Medium
Topic: "Extended Procedures" to Detect Fraud
Learning Objective: 06-07 Describe some extended procedures for detecting employee fraud
schemes involving cash.
Bloom's: Understand
AACSB: Analytical Thinking
Accessibility: Keyboard Navigation
2) When an employee embezzles company funds from an electric utility company for the purpose
of paying expenses of an anti-nuclear protest organization, the fraudster's motive is said to be:
A) psychotic.
B) egocentric.
C) ideological.
D) economic.
Answer: C
Difficulty: 1 Easy
Topic: The Fraud Triangle (AU-C 315, AS 2401)
Learning Objective: 06-02 Identify and explain the three conditions (i.e., the fraud triangle) that
often exist when a fraud occurs.
Bloom's: Remember
1
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3) Which of the following management policies would increase the probability of fraud in a
company?
A) Diversifying authority throughout divisions and subsidiaries in the organization.
B) Measuring performance and awarding bonuses based on short-term operating results.
C) Giving employees performance feedback that considers positive and constructive praise along
with critical and negative observations on their work.
D) Establishing work teams that share responsibilities, performance, and bonuses based on
collective efforts.
Answer: B
Topic: Fraud Prevention
Learning Objective: 06-03 Describe techniques that can be used to prevent employee fraud.
Bloom's: Apply
4) An auditor has identified the controller's review of the bank reconciliation as a control to test. In
connection with this test, the auditor interviews the controller to understand the specific data
reviewed on the reconciliation. In addition, the auditor verifies that the bank reconciliation is
properly prepared by the accountant and reviewed by the controller as evidenced by their
respective sign-offs. Which of the following types of audit procedures do these actions illustrate?
A) Observation and inspection of records.
B) Confirmation and reperformance.
C) Inquiry and inspection of records.
D) Analytical procedures and reperformance.
Answer: C
Difficulty: 3 Hard
Topic: The Audit of Cash
Learning Objective: 06-04 Identify the relevant assertions and risks of material misstatement that
are typically related to the cash balance.
Bloom's: Remember
2
5) Each of the following is a type of known misstatement, except:
A) an inaccuracy in processing data.
B) the misapplication of accounting principles.
C) differences between management and the auditor's judgment regarding estimates.
D) a difference between the classification of a reported financial statement element and the
classification according to generally accepted accounting principles.
Answer: C
Topic: Employee Fraud Overview
Learning Objective: 06-01 Define and explain the differences among several kinds of employee
frauds that might occur at an audit client.
Bloom's: Remember
6) Which of the following situations most likely represents the highest risk of a misstatement
arising from misappropriation of assets?
A) A large number of bearer bonds on hand.
B) A large number of inventory items with low sales prices.
C) A large number of transactions processed in a short period of time.
D) A large number of fixed assets with easily identifiable serial numbers.
Answer: A
Difficulty: 3 Hard
Bloom's: Remember
3
7) A company employs three accounts payable clerks and one treasurer. Their responsibilities are
as follows:
Employee Reviews
Clerk 1 Review vendor invoices for proper signature approval.
Enters vendor invoice into the accounting system and verifies payment
Clerk 2 terms.
Posts entered vendor invoices to accounts payable ledger for payment and
Clerk 3 mails checks.
Treasurer Review the vendor invoices and signs each check.
Which of the following would indicate a weakness in the company's internal controls?
A) Clerk 1 opens all of the incoming mail.
B) Clerk 2 reconciles the accounts payable ledger with the general ledger monthly.
C) Clerk 3 mails the checks and remittances after they have been signed.
D) The treasurer uses a stamp for signing checks.
Answer: C
Difficulty: 3 Hard
Bloom's: Remember
8) An auditor is considering whether the omission of the confirmation of investments impairs the
auditor's ability to support a previously expressed unmodified opinion. The auditor need not
perform this omitted procedure if:
A) the results of alternative procedures that were performed compensate for the omission.
B) the auditor's assessed level of detection risk is low.
C) the omission is documented in a communication with the audit committee.
D) no individual investment is material to the financial statements taken as a whole.
Answer: A
Difficulty: 3 Hard
Topic: Evaluating the Design and Operating Effectiveness of Internal Controls
Learning Objective: 06-05 Identify important internal control activities present in a properly
designed system to mitigate the risk of material misstatements for each relevant assertion related to
cash and to help prevent or detect employee fraud.
Bloom's: Remember
4
9) Which of the following is not considered one of the three factors increasing the probability of
fraud?
A) Motive.
B) Lack of training.
C) Opportunity.
D) Rationalization.
Answer: B
Difficulty: 1 Easy
Bloom's: Remember
10) Which of the following is ordinarily considered an "extended procedure" during the
independent audit of financial statements?
A) Send positive confirmations on recorded customer accounts receivable balances.
B) Perform physical observation and test count during the client's inventory taking.
C) Measure the time lag between the date of recording cash receipts in the books to the date of
deposit credit in the bank.
D) Conduct interviews with the client's sales billing personnel to learn about sales recording
control activities.
Answer: C
Bloom's: Apply
5
11) If the amount of a check is altered by an employee after it has cleared the bank, the change can
be detected by:
A) comparing the amount written on the check face to the amount written in the cash
disbursements journal.
B) comparing the magnetic imprint of the amount paid to the amount written on the check face.
C) examining the endorsement on the back of the check.
D) comparing the check number on the face of the check to the check number in the cash
disbursements journal.
Answer: B
Bloom's: Understand
12) Which of the following would be consistent with an employee taking cash receipts from
customers on account?
A) The total of the accounts receivable subsidiary ledger balances is less than the accounts
receivable control account.
B) The total of the accounts receivable subsidiary ledger balances is greater than the accounts
receivable control account.
C) Total cash receipts from customers for the month are less than credit sales for the month.
D) Total cash receipts from customers for the month are greater than credit sales for the month.
Answer: A
Bloom's: Apply
6
13) An audit plan of substantive procedures for cash would not include:
A) request a cutoff bank statement be mailed to the client.
B) request client to prepare bank reconciliations.
C) prepare a schedule of interbank transfers for a period of ten business days before and after
year-end date.
D) obtain a written client representation concerning compensating balance agreements.
Answer: A
Difficulty: 1 Easy
Bloom's: Remember
14) In the audit of cash the auditor obtains a bank cutoff statement primarily to:
A) identify old outstanding checks that the client may exclude from the year-end bank
reconciliation in order to misappropriate cash.
B) obtain sufficient information to reconcile the client's bank account as of year-end.
C) obtain direct confirmation of the client's bank balances as of year-end.
D) test the propriety of items appearing on the client's year-end bank reconciliation.
Answer: D
Bloom's: Apply
7
15) Auditors ordinarily send a standard confirmation request to all banks with which the client has
done business during the year under audit, regardless of the year-end balances. A purpose of this
procedure is to:
A) provide the data necessary to prepare a proof of cash.
B) request that a cutoff bank statement and related checks be sent to the audit.
C) detect questionable bank activities that may otherwise not be discovered.
D) seek information about contingent liabilities and security agreements.
Answer: D
Bloom's: Apply
16) To gather evidence regarding the bank's balance in a bank reconciliation, an auditor would
examine all of the following except the:
A) cutoff bank statement.
B) general ledger.
C) bank confirmation.
D) year-end bank statement.
Answer: B
Bloom's: Apply
17) An entity with a large volume of customer remittances by mail could most likely reduce the
risk of employee misappropriation of cash by using:
A) employee fidelity bonds.
B) independently prepared mailroom prelists.
C) daily check summaries.
D) a bank lockbox system.
Answer: D
Bloom's: Apply
8
18) Which of the following sets of information does an auditor usually confirm on one form?
A) Accounts payable and purchase commitments.
B) Cash in bank and collateral for loans.
C) Inventory on consignment and contingent liabilities.
D) Accounts receivable and accrued interest receivable.
Answer: B
Bloom's: Apply
19) An unrecorded check issued during the last week of the year would most likely be discovered
by the auditor when the:
A) check register for the last month is reviewed.
B) cutoff bank statement is reconciled.
C) bank confirmation is reviewed.
D) search for unrecorded liabilities is performed.
Answer: B
Bloom's: Apply
20) An auditor wishes to perform tests of controls on a client's cash disbursements procedures. If
the control activities leave no audit trail of documentary evidence, the auditor most likely will test
the activities by:
A) confirmation and observation.
B) observation and inquiry.
C) analytical procedures and confirmation.
D) inquiry and analytical procedures.
Answer: B
Bloom's: Apply
9
21) To provide assurance that each voucher is submitted and paid only once, an auditor most likely
would examine a sample of paid vouchers and determine whether each voucher is:
A) supported by a vendor's invoice.
B) stamped "paid" by the check signer.
C) prenumbered and accounted for.
D) approved for authorized purchases.
Answer: B
Difficulty: 3 Hard
Bloom's: Apply
AACSB: Communication
22) In order for auditors to be able to recognize potential fraud, they must be aware of the basic
characteristics of fraud. Which of the following is not a characteristic of fraud?
A) Intentional deception.
B) Taking unfair or dishonest advantage of other people.
C) Perpetration for the benefit or detriment of the organization.
D) Negligence on the part of executive management.
Answer: D
Bloom's: Remember
23) An auditor who discovers that client employees have committed an illegal act that has a
material effect on the client's financial statements most likely would withdraw from the
engagement if:
A) the illegal act is a violation of generally accepted accounting principles.
B) the client does not take the remedial action that the auditor considers necessary.
C) the illegal act was committed during a prior year that was not audited.
D) the auditor has already assessed control risk at the maximum level.
Answer: B
Bloom's: Apply
10
24) An auditor would least likely initiate a discussion with a client's audit committee concerning:
A) the methods used to account for significant unusual transactions.
B) the maximum dollar amount of misstatements that could exist without causing the financial
statements to be materially misstated.
C) indications of fraud and illegal acts committed by a corporate officer that were discovered by
the auditor.
D) disagreements with management as to accounting principles that were resolved during the
current year's audit.
Answer: B
Bloom's: Remember
AACSB: Communication
25) Which of the following statements is correct with respect to the elements of the "fraud
triangle"?
A) Motive is a cause that pressures people into action.
B) Opportunity refers to a situation that allows someone with motive to carry out fraud.
C) A lack of integrity describes a person who does not stick to the social or organizational ethical
code.
D) Fraud is most common when these three factors exist together.
E) All of these statements are correct.
Answer: E
Bloom's: Remember
AACSB: Ethics
11
26) Narbona, CPA, is reviewing controls over cash received through a bank night depository.
Which controls would she find most important?
A) Responsibilities are rotated for processing night depository receipts among employees of the
various departments.
B) Dual control (joint custody) is established over the contents of the night depository box from
the time of removal until initial recording is completed.
C) Vacations are required for all employees engaged in night depository activities.
D) All deposit tickets related to night deposits are numbered.
Answer: B
Difficulty: 3 Hard
Bloom's: Apply
27) Your client is in the process of acquiring another company. You have been requested to verify
that cash for the company being acquired is properly stated. The audit technique that will yield the
most persuasive evidence is:
A) examination of the company's escrow account.
B) interview with the company's treasurer and cash manager.
C) preparation and review of standard bank confirmation inquiries.
D) analytical computations comparing current cash in the bank with previous accounting periods.
Answer: C
Bloom's: Understand
28) A proof of cash:

A) is required by GAAS.
B) can be used to test the transactions process.
C) is most helpful when control risk for cash is low.
D) always detects lapping.
Answer: B
Difficulty: 3 Hard
Bloom's: Remember
12
29) When counting cash on hand the auditor must exercise simultaneous control over all cash and
other negotiable assets to prevent:
A) theft.
B) irregular endorsement.
C) replacement or substitution of stolen assets.
D) deposits in transit.
Answer: C
Difficulty: 3 Hard
Bloom's: Apply
30) As payments are received, one mailroom employee is assigned the responsibility of prelisting
receipts and preparing the deposit slip prior to forwarding the receipts, deposit slip, and remittance
advices to accounts receivable for posting. Accounts receivable personnel re-foot the deposit slip,
stamp a restrictive endorsement on the back of each check, and then forward the receipts and
deposit slip to the treasury department. Evaluate the internal control of the described process.
Which of the following is a reasonable assessment of internal control in this process?
A) Adequate internal control.
B) Inadequate internal control because mailroom employees should not have access to cash.
C) Inadequate internal control because treasury employees should prepare the deposit slip.
D) Inadequate internal control because of a lack of separation of duties.
Answer: D
Difficulty: 3 Hard
Bloom's: Understand
13
31) Which of the following should be performed by the persons opening the mail and recording
payments?
A) Restrictive endorsement on all checks.
B) Entering of payment information into customer accounts.
C) The preparation of the deposit slip and the delivery of the checks to the bank.
D) The segregation of all payments made on accounts listed as past due.
Answer: A
Bloom's: Understand
32) At the end of each business day, Safe Company sends its bank a listing of all checks written
during the day including the check number, payee, and amount. When a check is sent to the bank
for payment the bank compares the payee and the amount with the listing provided by Safe
Company. This system is called:
A) PayChex.
B) Pay-As-You-Go.
C) Positive Pay.
D) Pay Master.
Answer: C
Bloom's: Remember
33) The mail which includes payments should be opened by two people. This control is called:
A) separation of duties.
B) joint custody.
C) anti-collusion.
D) lapping.
Answer: B
Difficulty: 1 Easy
Bloom's: Remember
14
34) Most fraud investigators utilize the fraud triangle theory. A new theory called the fraud
diamond has been proposed. Which of the following is an element of the fraud diamond and is not
an element of the fraud triangle?
A) Motive.
B) Opportunity.
C) Capability.
D) Liquidity.
Answer: C
Bloom's: Remember
35) Auditors are auditing the cash receipts for Great Wall Corporation. For each audit procedure
performed (numbered 1 - 5 below) select the control objective being tested by placing the correct
letter in the blank.
A. Existence
B. Completeness
C. Authorization
D. Accuracy
E. Classification
F. Accounting and posting
G. Proper period
________ 1. For a sample of recorded cash receipts, the auditors compared the date of receipt to
the recording date.
________ 2. The auditors traced a sample of daily cash reports to the cash receipts journal.
________ 3. The auditors vouched a sample of recorded cash receipts to the deposits in the bank
statement.
________ 4. The auditors recalculate the cash listed on the daily deposit for a sample of recorded
cash receipts.
________ 5. The auditors traced a sample of recorded cash receipts to postings in the correct
customers' accounts.
Answer: 1. G, 2. B, 3. A, 4. D, 5. F
Topic: Cash Internal Control Considerations
Bloom's: Apply
15
36) When you examine canceled checks returned in the bank statement by a client's bank, how
could you tell whether the amount on the check had been skillfully raised (increased, say, from
$75.00 to $7,500 in the amount box, and altered in the written line from "Seventy-five dollars" to
"Seventy-five hundred dollars") after the check was cleared by the bank? (An employee might do
this to "support" a $7,500 cash disbursement journal entry.)
Answer: The bank imprints the check with the amount paid by the bank (magnetic print in the
lower right corner). It will be 00007500, meaning $75.00.
Difficulty: 3 Hard
Bloom's: Apply
37) After checks are signed for vendor invoices, why should vouchers be marked "paid" or
otherwise mutilated?
Answer: To show they have been processed so they cannot be paid again.
Bloom's: Apply
38) List, and briefly describe, the three factors that increase the probability of fraud.
Answer: Motive, opportunity, and lack of integrity are the three factors that increase the
probability of fraud. Motive is a cause that pressures people into action. Economic motives are
common in business fraud. Opportunity refers to a situation that allows someone with motive to
carry out fraud. An example would be a lack or lapse of a specific control or controls in an
organization. A lack of integrity describes a person who does not stick to the social or
organizational ethical code. They may rationalize their actions to defend such a lack of integrity.
Fraud is most common when these three factors exist together.
Bloom's: Remember
16
39) What kind of error or fraud could happen if the inventory warehouse manager also had
responsibility for making the physical inventory count and reconciling discrepancies to the
perpetual inventory records?
Answer: The inventory manager could
1. Commit an inadvertent error of miscounting and adjust the error into the accounts and
inventory records.
2. Steal inventory and adjust the inventory records permanently to cover up the theft.
Bloom's: Apply
40) Describe how a lockbox works and indicate the advantages of such a system.
Answer: A lockbox is a post office box under the control of the bank. The bank will send
employees to retrieve checks from the box and deposit them in the company's account. The bank
will provide a listing of deposits and the remittance advises to the company. The bank may also
provide images of the checks (if the company is willing to pay for these additional services).
There are two main advantages to this system:

1. Checks are retrieved by the bank and never enter the company. Therefore the risk that checks
will be misplaced or end up in the hands of the wrong individuals is eliminated. Separation of
duties also becomes easier since the custody of the asset is no longer a possible for record keepers
or authorizers.
2. The money is placed immediately into the bank allowing for immediate access to the use of the
funds or interest on the funds.
Bloom's: Apply
17
41) Ed's wife Diane owns a printing business in town. Ed works in the accounts payable
department of Jiffy Abs Vitamin Company. Diane prints invoices for work supposedly done for
Jiffy Abs (no actual work was performed) and Ed places in the invoice in the approved for
payment invoice pile. Jiffy Abs pays these invoices and sends Diane a check.
1. Name two internal controls that might prevent or detect these fraudulent payments.
2. Name two audit procedures that might detect this fraud.
Answer:
1. Controls include:
• Voucher package that includes a receiving report

• An approved vendor list and the requirement that the vendor be on the approved vendor list
• The inclusion of an expense account for the charging of all material. Each department gets a
report of all expenses each month for review.
2. Procedures include:
• Review of voucher packages to ensure goods were received

• Review of voucher packages to ensure vendors are on the approved vendor list
• Analytical procedures to identify increases in expenditures for specific types of products
(printing services)
• Analytical procedures to identify increases in expenditures to specific vendors.
Bloom's: Apply
18
42) Micro Chip Corporation (MCC) has a special PO Box for customer payments. Jane is
responsible for:
• going to the post office every day,

• emptying the post office box,
• opening the mail,
• making a prelist,
• sending the remittance advices to accounts receivable, and
• sending the checks to the cashier's office.
Jane has opening a business account at her bank for Master Cleaning Company (MCC). Several of
Micro Chips checks are made out with only the initials MCC. Jane selects certain checks made out
only with the initials MCC and deposits them in her business account. She would destroy the
remittance advice.
1. Name two controls that would prevent or detect this fraud.

2. Name two audit procedures that might detect this fraud.
Answer: Controls include:

1. A separate person could empty the PO Box, record how many envelops were in the box and
deliver the unopened mail to Jane. Jane would be required to account for each envelop.
• The mail could be picked up under joint custody

• The mail could be opened under joint custody
• Surveillance equipment could be used to monitor the opening and recording of payments
• Since customer complaints would be made because payments would not be credited to their
account, and independent and vigorous complaint resolution process would be a good control
• Mailing of statements each month to customers with balances or activity in their account
• Follow up communication on customer accounts that are past due by someone independent of
accounts receivable
2. Procedures would include:

• Observe the opening of the mail and the recording of cash
• Review of customer complaints for patterns and appropriate follow up by company personnel
• From a sample of customer complaints, ask customers to send a copy of their payment (front
and back) and review check for endorsement and bank account
• Review of the aging of accounts receivable schedule (accounts where payments were diverted
would begin to have past due balances)
• Confirm account balances with customers
• Review responses to follow up communications on customer past due accounts.
Difficulty: 3 Hard
Bloom's: Apply
19
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A BAKED IRISH STEW.
Fill a brown upright Nottingham jar with alternate layers of mutton

(or beef), sliced potatoes, and mild onions; and put in water and
seasoning as above; cover the top closely with whole potatoes
(pared), and send the stew to a moderate oven. The potatoes on the
top should be well cooked and browned before the stew is served.
We have not considered it necessary to try this receipt, which was
given to us by some friends who keep an excellent table, and who
recommended it much. It is, of course, suited only to a quite plain
family dinner. The onions can be omitted when their flavour is not
liked.
CUTLETS OF COLD MUTTON.
Trim into well-shaped cutlets, which should not be very thin, the
remains of a roast loin or neck of mutton, or of a quite underdressed
stewed or boiled joint; dip them into egg and well-seasoned bread-
crumbs, and broil or fry them over a quick fire that they may be
browned and heated through without being too much done. This is a
very good mode of serving a half roasted loin or neck. When the
cutlets are broiled they should be dipped into, or sprinkled thickly
with butter just dissolved, or they will be exceedingly dry; a few
additional crumbs should be made to adhere to them after they are
moistened with this.
MUTTON KIDNEYS À LA FRANÇAISE. (ENTRÉE.)
Skin six or eight fine fresh mutton kidneys, and without opening
them, remove the fat; slice them rather thin, strew over them a large
dessertspoonful of minced herbs, of which two-thirds should be
parsley and the remainder thyme, with a tolerable seasoning of
pepper or cayenne, and some fine salt. Melt two ounces of butter in
a frying-pan, put in the kidneys and brown them quickly on both
sides; when nearly done, stir amongst them a dessertspoonful of
flour and shake them well in the pan; pour in the third of a pint of
gravy (or of hot water in default of this), the juice of half a lemon, and
as much of Harvey’s sauce, or of mushroom catsup, as will flavour
the whole pleasantly; bring these to the point of boiling, and pour
them into a dish garnished with fried sippets, or lift out the kidneys
first, give the sauce a boil and pour it on them. In France, a couple of
glasses of champagne, or, for variety, of claret, are frequently added
to this dish: one of port wine can be substituted for either of these. A
dessertspoonful of minced eschalots may be strewed over the
kidneys with the herbs; or two dozens of very small ones previously
stewed until tender in fresh butter over a gentle fire, may be added
after they are dished. This is a very excellent and approved receipt.
Fried 6 minutes.
BROILED MUTTON KIDNEYS.
Split them open lengthwise without dividing them, strip off the skin
and fat, run a fine skewer through the points and across the back of
the kidneys to keep them flat while broiling, season them with pepper
or cayenne, lay them over a clear brisk fire, with the cut sides
towards it, turn them in from four to five minutes, and in as many
more dish, and serve them quickly, with or without a cold Maître
d’Hôtel sauce under them. French cooks season them with pepper
and fine salt, and brush a very small quantity of oil or clarified butter
over them before they are broiled: we think this an improvement.
8 to 10 minutes.
OXFORD RECEIPT FOR MUTTON KIDNEYS. (BREAKFAST DISH,
OR ENTRÉE.)
Fry gently in a little good butter, a dozen croûtons (slices of bread,

of uniform shape and size, trimmed free from crust), cut half an inch
thick, about two inches and a half wide, and from three to four in
length: lift them out and keep them hot. Split quite asunder six fine
fresh kidneys, after having freed them from the skin and fat; season
them with fine salt and cayenne, arrange them evenly in a clean
frying-pan, and pour some clarified butter over them. Fry them over a
somewhat brisk fire, dish each half upon a croûton, make a sauce in
the pan as for veal cutlets, but use gravy for it instead of water,
should it be at hand; add a little wine or catsup, pour it round the
croûtons, and serve the kidneys instantly.
10 minutes.
TO ROAST A FORE QUARTER OF LAMB.
This should be laid to a clear brisk fire, and carefully and plentifully
basted from the time of its becoming warm until it is ready for table;
but though it requires quick roasting, it must never be placed
sufficiently near the fire to endanger the fat, which is very liable to
catch or burn. When the joint is served, the shoulder should be
separated from the ribs with a sharp knife; and a small slice of fresh
butter, a little cayenne, and a squeeze of lemon juice should be laid
between them; if the cook be an expert carver, this had better be
done before the lamb is sent to table. The cold Maître d’Hôtel sauce
of Chapter VI. may be substituted for the usual ingredients, the
parsley being omitted or not, according to the taste. Serve good mint
sauce, and a fresh salad with this roast.
A leg, shoulder, or loin of lamb should be cooked by the same
directions as the quarter, a difference only being made in the time
allowed for each.
Fore quarter of lamb, 1-3/4 to 2 hours. Leg, 1-1/2 hour (less if very
small); shoulder, 1 to 1-1/4 hour.
Obs.—The time will vary a little, of course, from the difference in
the weather, and in the strength of the fire. Lamb should always be
well roasted.
SADDLE OF LAMB.
This is an exceedingly nice joint for a small party. It should be

roasted at a brisk fire, and kept constantly basted with its own
dripping: it will require from an hour and three quarters to two hours
roasting. Send it to table with mint sauce, brown cucumber sauce,
and a salad.
1-3/4 to 2 hours.
Obs.—The following will be found an excellent receipt for mint
sauce:—With three heaped tablespoonsful of finely-chopped young
mint, mix two of pounded and sifted sugar, and six of the best
vinegar: stir it until the sugar is dissolved.
ROAST LOIN OF LAMB.
Place it at a moderate distance from a clear fire, baste it

frequently, froth it when nearly done, and serve it with the same
sauces as the preceding joints. A loin of lamb may be boiled and
sent to table with white cucumber, mushroom, common white sauce,
or parsley and butter.
1 to 1-1/4 hour.
STEWED LEG OF LAMB WITH WHITE SAUCE. (ENTRÉE.)[81]
81. This may be served as a remove in a small unceremonious dinner.
Choose a small plump leg of lamb, not much exceeding five

pounds in weight; put it into a vessel nearly of its size, with a few
trimmings or a bone or two of undressed veal if at hand; cover it with
warm water, bring it slowly to a boil, clear off the scum with great
care when it is first thrown to the surface, and when it has all been
skimmed off, add a faggot of thyme and parsley, and two carrots of
moderate size. Let the lamb simmer only, but without ceasing, for an
hour and a quarter; serve it covered with béchamel, or rich English
white sauce, and send a boiled tongue to table with it, and some of
the sauce in a tureen.
1-1/4 hour.
LOIN OF LAMB STEWED IN BUTTER. (ENTRÉE.)
Wash the joint, and wipe it very dry; skewer down the flap, and lay
it into a close-shutting and thick stewpan or saucepan, in which three
ounces of good butter have been just dissolved, but not allowed to
boil; let it simmer slowly over a very gentle fire for two hours and a
quarter, and turn it when it is rather more than half done. Lift it out,
skim and pour the gravy over it; send asparagus, cucumber, or
soubise sauce to table with it; or brown gravy, mint sauce, and a
salad.
2-1/4 hours.
LAMB OR MUTTON CUTLETS, WITH SOUBISE SAUCE.
(ENTRÉE.)
The best end of two necks of either will be required for a

handsome dish. Cut them thin with one bone to each; trim off the fat
and all the skin, scrape the bones very clean that they may look
white, and season the cutlets with salt and white pepper; brush them
with egg, dip them into very fine bread-crumbs, then into clarified
butter, and again into the bread-crumbs, which should be flattened
evenly upon them, and broil them over a very clear and brisk fire, or
fry them in a little good butter of a fine clear brown; press them in
two sheets of white blotting paper to extract the grease, and dish
them in a circle, and pour into the centre a soubise sauce, or a purée
of cucumbers. Brown cucumber sauce or a rich gravy, may be
substituted for either of these in serving a quite simple dinner.
Cutlets of the loin may be dressed in the same way after being
dipped into crumbs of bread mixed with a full seasoning of minced
herbs, and with a small quantity of eschalot when its flavour is liked.
The small flat bone at the end of the cutlets should be taken off, to
give them a good appearance.
LAMB CUTLETS IN THEIR OWN GRAVY.
Follow exactly the receipt for mutton cutlets dressed in the same
way, but allow for those of lamb fifteen or twenty minutes less of
time, and an additional spoonful of liquid.
CUTLETS OF COLD LAMB.
See the receipt for Cutlets of Cold Mutton, page 243.

CHAPTER XIII.
Pork.
No.
1. The Spare Rib.
2. Hand.
3. Belly, or Spring.
4. Fore Loin.
5. Hind Loin.
6. Leg.
In season from Michaelmas to March: should be avoided in very warm weather.

TO CHOOSE PORK.
This meat is so proverbially, and we believe even dangerously

unwholesome when ill fed, or in any degree diseased, that its quality
should be closely examined before it is purchased. When not home-
reared, it should be bought if possible of some respectable farmer or
miller, unless the butcher who supplies it can be perfectly relied on.
Both the fat and lean should be very white, and the latter finely
grained; the rind should be thin, smooth, and cool to the touch; if it
be clammy, the pork is stale, and should be at once rejected; it ought
also to be scrupulously avoided when the fat, instead of being quite
clear of all blemish, is full of small kernels which are indicative of
disease. The manner of cutting up the pork varies in different
counties, and also according to the purposes for which it is intended.
The legs are either made into hams, or slightly salted for a few days
and boiled; they are also sometimes roasted when the pork is not
large nor coarse, with a savoury forcemeat inserted between the skin
and flesh of the knuckle. The part of the shoulder provincially called
the hand, is also occasionally pickled in the same way as hams and
bacon, or it is salted and boiled, but it is too sinewy for roasting. After
these and the head have been taken off, the remainder, without
further division than being split down the back, may be converted
into whole sides, or flitches as they are usually called, of bacon; but
when the meat is large and required in part for various other
purposes, a chine may be taken out, and the fat pared off the bones
of the ribs and loins for bacon; the thin part of the body converted
into pickled pork, and the ribs and other bones roasted, or made into
pies or sausages. The feet, which are generally salted down for
immediate use, are excellent if laid for two or three weeks into the
same pickle as the hams, then well covered with cold water, and
slowly boiled until tender.
The loins of young and delicate pork are roasted with the skin on;
and this is scored in regular stripes of about a quarter of an inch
wide with the point of a sharp knife, before the joints are laid to the
fire. The skin of the leg also is just cut through in the same manner.
This is done to prevent its blistering, and to render it more easy to
carve, as the skin (or crackling) becomes so crisp and hard in the
cooking that it is otherwise sometimes difficult to divide it.
To be at any time fit for table, pork must be perfectly sweet, and
thoroughly cooked; great attention also should be given to it when it
is in pickle, for if any part of it be long exposed to the air, without
being turned into, or well and frequently basted with the brine, it will
often become tainted during the process of curing it.
TO MELT LARD.
Strip the skin from the inside fat of a freshly killed and well-fed pig;
slice it small and thin; put it into a new or well-scalded jar, set it into a
pan of boiling water, and let it simmer over a clear fire. As it
dissolves, strain it into small stone jars or deep earthen pans, and
when perfectly cold, tie over it the skin that was cleared from the
lard, or bladders which have been thoroughly washed and wiped
very dry. Lard thus prepared is extremely pure in flavour, and keeps
perfectly well if stored in a cool place; it may be used with advantage
in making common pastry, as well as for frying fish, and for various
other purposes. It is better to keep the last drainings of the fat apart
from that which is first poured off, as it will not be quite so fine in
quality.
TO PRESERVE UNMELTED LARD FOR MANY MONTHS.
For the particular uses to which the leaf-fat, or fleed, can be

advantageously applied, see fleed-crust, Chapter XVIII. It may be
kept well during the summer months by rubbing fine salt rather
plentifully upon it when it is first taken from the pig, and letting it lie
for a couple of days; it should then be well drained, and covered with
a strong brine; this in warmer weather should be changed
occasionally. When wanted for use, lay it into cold water for two or
three hours, then wipe it dry, and it will have quite the effect of the
fresh fleed when made into paste.
Inner fat of pig, 6 lbs.; fine salt, 1/2 to 3/4 lb.: 2 days. Brine: to
each quart of water, 6 oz. salt.
TO ROAST A SUCKING PIG.
After the pig has been scalded and

prepared for the spit, wipe it as dry as
possible, and put into the body about
half a pint of fine bread-crumbs, mixed
with three heaped teaspoonsful of
sage, minced very small, three
ounces of good butter, a large
saltspoonful of salt, and two-thirds as
much of pepper or some cayenne. Sew it up with soft, but strong
cotton; truss it as a hare, with the fore legs skewered back, and the
hind ones forward; lay it to a strong clear fire, but keep it at a
moderate distance, as it would quickly blister or scorch if placed too
near. So soon as it has become warm, rub it with a bit of butter tied
in a fold of muslin or of thin cloth, and repeat this process constantly
while it is roasting. When the gravy begins to drop from it, put basins
or small deep tureens under, to catch it in.[82] As soon as the pig is
of a fine light amber brown and the steam draws strongly towards
the fire, wipe it quite dry with a clean cloth, and rub a bit of cold
butter over it. When it is half done, a pig iron, or in lieu of this, a large
flat iron should be hung in the centre of the grate, or the middle of
the pig will be done long before the ends. When it is ready for table
lay it into a very hot dish, and before the spit is withdrawn, take off
and open the head and split the body in two; chop together quickly
the stuffing and the brains, put them into half a pint of good veal
gravy ready thickened, add a glass of Madeira or of sherry, and the
gravy which has dropped from the pig; pour a small portion of this
under the roast and serve the remainder as hot as possible in a
tureen: a little pounded mace and cayenne with a squeeze of lemon-
juice, may be added, should the flavour require heightening. Fine
bread sauce, and plain gravy should likewise be served with it. Some
persons still prefer the old-fashioned currant sauce to any other: and
many have the brains and stuffing stirred into rich melted butter,
instead of gravy; but the receipt which we have given has usually

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Auditing and Assurance Services 7th

Edition Louwers Test Bank

1) When auditing financial statements and finding indications of a possible misappropriation of

28) A proof of cash:

Answer: The inventory manager could

There are two main advantages to this system:

• Voucher package that includes a receiving report

• Review of voucher packages to ensure goods were received

• going to the post office every day,

1. Name two controls that would prevent or detect this fraud.

Answer: Controls include:

• The mail could be picked up under joint custody

2. Procedures would include:

Fill a brown upright Nottingham jar with alternate layers of mutton

Fry gently in a little good butter, a dozen croûtons (slices of bread,

This is an exceedingly nice joint for a small party. It should be

Place it at a moderate distance from a clear fire, baste it

Choose a small plump leg of lamb, not much exceeding five

The best end of two necks of either will be required for a

See the receipt for Cutlets of Cold Mutton, page 243.

In season from Michaelmas to March: should be avoided in very warm weather.

This meat is so proverbially, and we believe even dangerously

For the particular uses to which the leaf-fat, or fleed, can be

After the pig has been scalded and

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