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539 
53 
A(iii), B(ii), C(i) 
Refer back to the chapter if you didn't get this right. 
(Chapter 10)
54 
A(ii), B(i), C(iii) 
Make sure you know the features of the control system, as these relate to 
the main accounting systems in the organisation. 
(Chapter 10)
55 (a)
 
Yes 
No 
New bookkeeper 

New overseas customer 

Lack of supervision 

Cash transactions 

Cash transactions of themselves do not indicate fraud, as it seems that amounts are being 
paid in as well as out. This seems more likely to indicate money laundering. 
(b) 
Layering 
Placement usually involves small sums of money. The business to business 
transactions with the overseas customer are more indicative of layering. 
(c) 
Report her suspicions to the authorities immediately 
Once Leticia's suspicions are aroused, she should report the transactions to the 
authorities. Otherwise she may be committing the offence of failure to report. If found 
guilty she could go to prison for five years and/or suffer a fine. 
(Chapter 10)
56 
Legitimate power
Also known as 'position' power, as it derives from a given role in the chain of command. Physical 
power is based on superior force; resource power on control over valued resources or rewards; 
and expert power on possession of valued knowledge or expertise. 
(Chapter 11)
57 Neo-human 
relations 
The neo-human relations school argued that a wide range of employee motivations impact on 
performance: the human relations school pioneered this insight, but focused on social or 
belonging needs. Scientific management focused instead on technical efficiency. The contingency 
school argued that a wide range of factors – human and non-human – impact on performance. 
(Chapter 11)
58 
Concern for production and concern for people 
The grid plots concern for production and concern for people. A balance between managerial and 
subordinate discretion can be seen in other style theories, such as 'Tells-sells-consults-joins'. 
Psychological distance and situation are factors in Fiedler's contingency theory. The distinction 
between leadership and authority is used by Heifetz to distinguish between leaders (potentially 
informal or emergent) and managers (in positions of formal authority). 
(Chapter 11)
59 Communicating 
Communicating is not one of Fayol's five functions of management.
 (Chapter 11)
60 
Handling disturbances
This is a decisional role. The 'disturbances' referred to are unpredictable situations that require 
managerial input to resolve. 
(Chapter 11)
61 
Category Roles
 
Interpersonal: Figurehead; Leader; Liaison 
Informational: Monitor; Spokesperson; Disseminator 
Decisional: Entrepreneur; Disturbance handler; Resource allocator; Negotiator 
(Chapter 11)
62 
Legitimate power
(Or 'position' power) is power arising from an individual's formal position in the organisation. 
(Chapter 11)
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