The former bookkeeper of White Electric Supply is serving time in prison for embezzlingnearly $416,000 in less than five years. She describes herself as “an ordinary mother of three kidsand a proud grandmother of four.” Like so many other “ordinary” employees, she started out bytaking only small amounts. By the time she was caught, she was stealing lump sums of $5,000and $10,000.Her method was crude and simple. She would write a check for the correct amount payable to asupplier for, say, $15,000. However, she would record in the company’s check register an amountsignificantly greater, say, $20,000. She would then write a check payable to herself for the $5,000 difference. In the check register, next to the number of each check she had deposited in her per-sonal bank account, she would write the word “void,” making it appear as though the check had been destroyed. This process went undetected for nearly five years.a. What controls must have been lacking at White Electric Supply to enable the bookkeeper tosteal nearly $416,000 before being caught?b. What the bookkeeper did was definitely unethical. But what if one of her grandchildren had been ill and needed an expensive operation? If this had been the case, would it have been ethi-cal for her to take company funds to pay for the operation if she intended to pay the company back in full? Defend your answer.

The former bookkeeper of White Electric Supply is serving time in prison for embezzling
nearly $416,000 in less than five years. She describes herself as “an ordinary mother of three kids
and a proud grandmother of four.” Like so many other “ordinary” employees, she started out by
taking only small amounts. By the time she was caught, she was stealing lump sums of $5,000
and $10,000.
Her method was crude and simple. She would write a check for the correct amount payable to a
supplier for, say, $15,000. However, she would record in the company’s check register an amount
significantly greater, say, $20,000. She would then write a check payable to herself for the $5,000

difference. In the check register, next to the number of each check she had deposited in her per-
sonal bank account, she would write the word “void,” making it appear as though the check had

been destroyed. This process went undetected for nearly five years.
a. What controls must have been lacking at White Electric Supply to enable the bookkeeper to
steal nearly $416,000 before being caught?
b. What the bookkeeper did was definitely unethical. But what if one of her grandchildren had

been ill and needed an expensive operation? If this had been the case, would it have been ethi-
cal for her to take company funds to pay for the operation if she intended to pay the company

back in full? Defend your answer.

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