ExpertMedium2 marksMultiple Choice
ACCA · Question 14 · Syllabus C: Business functions, regulation and technology
An accounts clerk at a charity steals a cash donation from Donor A. To cover this up, the clerk uses the next cash donation from Donor B to credit Donor A's account. This process continues, constantly using new receipts to cover previous thefts. What specific type of fraud is this?
An accounts clerk at a charity steals a cash donation from Donor A. To cover this up, the clerk uses the next cash donation from Donor B to credit Donor A's account. This process continues, constantly using new receipts to cover previous thefts. What specific type of fraud is this?
Answer options:
A.
Money laundering
B.
Teeming and lading
C.
Phishing
D.
Window dressing
How to approach this question
Identify the specific accounting term for 'lapping' or rolling over stolen cash receipts.
Full Answer
B.Teeming and lading✓ Correct
Teeming and lading is a classic bookkeeping fraud. It involves stealing cash received from one customer and covering the shortage with cash received from another customer. It requires constant maintenance by the fraudster to keep the chain going.
Common mistakes
Confusing it with money laundering. Money laundering deals with 'dirty' money from outside; teeming and lading is internal theft.
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