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John Collins has custody of the company's cash assets. He steals a cash remittance and covers the theft by recording a bad-debt write off. It is most likely that there was a failure in the area of

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The scenario described suggests a failure in the area of internal controls or financial oversight within the company. The fact that John Collins, who has custody of the company's cash assets, was able to steal a cash remittance and cover it up by recording a bad-debt write off indicates weaknesses in the system that is supposed to prevent and detect such fraudulent activities. This could be a breakdown in segregation of duties, lack of proper authorization, or insufficient checks and balances in place to ensure the accuracy and integrity of financial transactions.
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