Final answer:
The statement is true. The most difficult type of cash embezzlement for auditors to detect is when the cash is stolen before it can be recorded in the cash receipts journal. This type is known as lapping payment and covers it up by using a subsequent customer's payment to replace the stolen amount.
Step-by-step explanation:
The statement is true. One of the most difficult types of cash embezzlement for auditors to detect is when the cash is stolen before it can be recorded in the cash receipts journal. This type of embezzlement is known as lapping. Lapping involves the misappropriation of funds by an employee who steals cash from one customer's payment and covers it up by using a subsequent customer's payment to replace the stolen amount.
The most difficult type of cash embezzlement for auditors to detect is when the cash is stolen before it can be recorded in the cash receipts journal. This type is known as lapping payment and covers it up by using a subsequent customer's payment to replace the stolen amount.