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WEEK TWO – Preventing Fraud

See the “The Trolley Dodgers” case for this question.


The San Francisco Giants are easily the most heated, if not hated, rival of the Dodgers. In March 2012, a federal judge sentenced the Giants’ former payroll manager to 21 months in prison after she pleaded guilty to embezzling $2.2 million from the Giants organization. An attorney for the Giants testified that the payroll manager “wreaked havoc” on the Giants’ players, executives, and employees. The attorney said that the embezzlement “included more than 40 separate illegal transactions, including changing payroll records and stealing employees’ identities and diverting their tax payments.” A federal prosecutor reported that the payroll manager used the embezzled funds to buy a luxury car, to purchase a second home in San Diego, and to travel.

When initially confronted about her embezzlement scheme, the payroll manager had “denied it completely.” She confessed when she was shown the proof that prosecutors had collected. During her sentencing hearing, the payroll manager pleaded with the federal judge to sentence her to five years probation but no jail term. She told the judge, “I cannot say how sorry that I am that I did this, because it’s not who I am. I have no excuse for it. There is no excuse in the world for taking something that doesn’t belong to you.”

For more insight into this story, please visit these articles:

Former Giants Payroll Manager Sentenced to 21 Months (Links to an external site.)

San Francisco Giants Payroll Manager (Links to an external site.)


Provide a narrated PowerPoint with answers to these questions:

  1. Identify the key audit objectives for a client’s payroll function. Comment on objectives related to tests of controls and substantive audit procedures.
  2. What internal control weaknesses were evident in the Dodgers’ payroll system?
  3. Identify audit procedures that might have led to the discovery of the fraudulent scheme masterminded by Campos.


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