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  3. Media Reaction

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  4. Katrinas Kitchen

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Help Hurricane Katrina Survivors

Submitted by chloelee on July 19, 2008

Category: Business
Words: 639 | Pages: 3
Views: 9
Popularity Rank: 118,760
Average Member Grade: N/A (Add a Comment / Grade this Paper)

Help Hurricane Katrina Survivors
The Berkeley Hurricane Katrina Club raises funds to help the Hurricane Katrina survivors. Survivors must submit a form explaining how much they had lost in the hurricane, how much they need to survive, etc. The forms will be sent to the American Red Cross who will give a “relief payment”. On receiving these funds, the club will distribute them to each applicant. In addition to these funds, there are advertisement, traveling (both reimbursed by Berkeley), and temporary food and shelter relief fees (given by donations/charities, etc). All in all, the club handles about $60,000 in one school year. Therefore, a lot of money passes through the hands of the members, and internal auditing, a type of system that can examine and evaluate the club’s activities, is a necessity.
Because a lot of money transaction occurs in the club, we must be prepared for corrupt members who try to profit through the club. By cooperating with people outside the club, a member of the club executive can collect/submit false “Hurricane Katrina survivor” claims. On the other hand, a member can submit a certain number of applications to the American Red Cross but only bring back a fraction of those applicants’ funds. In order for this scheme to work, it would require change in the records of how many claims were sent out to the Red Cross. Another scheme would be to falsely label advertisement and traveling fees. The member might try and get reimbursed for club deeds when in fact the money was used for personal expenses. An even more subtle way would be to allocate a bigger amount of advertisement, travel, and food and shelter funds than was actually necessary. Furthermore, he/she can easily not record all the donations from the community, charities, etc.
Alongside the obvious book keeping, there must be further “checks” in the club in order to prevent and detect such frauds from occurring. First off, someone not involved...

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