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NEW QUESTION: 1
An audit had been scheduled to address unusual inventory shortages revealed in the annual physical inventory process at a large consumer goods warehouse operation. A cycle count programme had been installed in the storeroom at the beginning of the year in place of the disruptive process of counting one entire product line at the end of each month. The cycle count programme appeared effective based on the fact that only nine minor adjustments had been made for the entire year on the several thousand different products located in the storeroom. The storeroom supervisor explained that each of the fifteen stockroom personnel selected one item each day for cycle count based on how efficiently the item could be counted.
The opportunity for control-related problems including fraud has been increased in the stockroom because
A. Stockroom personnel selects items for cycle count.
B. Stockroom personnel records cycle count information.
C. A cycle count programme has been installed in place of a less efficient programme.
D. Only nine minor adjustments have been recorded as a result of the cycle count process.
Answer: A


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