Final answer:
To conceal embezzlement, an employee may use methods such as understating the sales journal, overstating accounts receivable, or understating the cash receipts journal. Understating the cash receipts journal is the technique least likely to be detected by an auditor as it aligns with the physical cash count and does not create immediate discrepancies in records.
Step-by-step explanation:
The question pertains to the concealment of embezzlement within a business setting, specifically related to the misappropriation of cash receipts from sales on account. To analyze which act would conceal embezzlement and be least likely to be detected by an auditor, let's consider a hypothetical scenario: A young person is working as a cashier in a retail store, and their cash drawer has been short for several days. When confronted and labeled as a thief by their boss, the employee is under suspicion of stealing.
If the cashier has indeed been committing embezzlement, they might attempt to conceal their theft using various methods. For instance, they could understate the sales journal, which would make the sales figures match the lower cash receipts that the cashier has recorded after taking some of the cash. Alternatively, they could overstate the accounts receivable control account, creating a false perception that more money is due to come in from customers than is actually expected, masking the shortfall in the cash. Another method is to overstate the accounts receivable subsidiary records, where they could inflate individual customer balances to suggest that customers owe more than they do, again concealing the cash stolen. Finally, they could understate the cash receipts journal, recording less cash as having been received than was actually collected.