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Question 4c

You are a manager in Beck & Co. an audit firm. Your firm performs the audit of Jarvis Co, a company which installs windows. Jarvis Co uses sales representatives to make direct sales to customers. The sales representatives earn a small salary, and also earn a sales commission of 20% of the sales they generate.

Jarvis Co’s sales manager has discovered that one of the sales representatives has been operating a fraud, in which he was submitting false claims for sales commission based on non-existent sales. The sales representative started to work at Jarvis Co in January 2012. The forensic investigation department of your firm has been engaged to quantify the amount of the fraud.

Required:

Recommend the procedures that should be used in the forensic investigation to quantify the amount of the fraud. (4 marks)