Minos Brezhnev, an immigrant from Ukraine, is a hotel owner in LasVegas. Since his arrival in America during the 1960s, Brezhnev has builta very successful and popular hotel. Until recently, the hotel averaged$20 million in total revenue per year. Lately though, there have beenrumors that Brezhnev’s hotel, the Russian Ruble, may be sufferingunusual losses. Recently, several of Brezhnev’s key staff have quit,complaining about low wages and nonexistent benefits. In fact, thehotel’s main attraction, its popular restaurant chef Alec Torenko, quitas well as the hotel’s headlining performer. While Brezhnev focused oncoming up with a new compensation policy, he hired CPA Bob Slider tolook into the hotel’s diminishing cash flows. The first thing Bob didwas head for the kitchen to partake of the award-winning food. The newchef, Calvin Crapes, wasn’t what Bob expected. First of all, he wasn’tRussian, as most of the employees seemed to be, and second he refused totalk about why he had come to the Russian Ruble when so many wanted toleave. After his visit to the kitchen, Bob began sifting through theaccounting documentation looking for possible fraud symptoms. Bobreasoned that if employees felt like they weren’t being compensatedaccordingly, they may be apt to defraud the hotel.Additional FactsIn addition to the above, the hotel had recently changed a number of its usual vendors.The new chef Calvin, switched the food supplier contract to Supreme MeatsLinens were now being cleaned by Supreme LaundrySupplies to the gift shop were being delivered by Supreme GiftCars were being parked by Supreme Valets.Running a quick business check, Bob found all these ‘supreme’ companies were run by Calvin’s brother-in-law, Steve.Using both the required text and external resources, address each ofthe questions below. Your responses should range between 2-4 strongparagraphs for each question, with references appropriately cited.Visuals (tables, charts, graphs) are encouraged as a tool in summarizingmajor points.Could Bob be right? Are employees defrauding the company, or has the Russian Ruble finally at the end of its success?What possible fraud activities are associated with declining cash flows?
