A Key Indicator of Fraud in the Revenue Cycle Is

question 105

Multiple Choice

A key indicator of fraud in the revenue cycle is the auditor's detection of which of the following?

• A)Customer collections that are over 90 days past due.
• B)Credit entries in customer accounts receivable for authorized write-offs.
• C)Recurring entries in the sales journal.
• D)Altered shipping documents and invoices.

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Definitions:

Cash Flow

The net amount of cash being transferred into and out of a business, affecting its liquidity.

Creditors

Entities or individuals that a company or person owes money to.

Principal Repaid

The portion of a loan payment that goes toward reducing the original loan amount, as opposed to the portion that goes toward paying interest.

Interest Paid

The amount paid over a period for borrowing money, typically expressed as an annual percentage rate.