Establishing Clear and Uniform Accounting Procedures with No Exception Clauses

question 11

Multiple Choice

Establishing clear and uniform accounting procedures with no exception clauses can help reduce financial statement fraud by addressing which side of the fraud triangle?

• A) Pressures to commit fraud
• B) Opportunity to commit fraud
• C) Rationalizations of financial statement fraud
• D) Non-sharable problems

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Definitions:

Thin Capitalization

In corporation law, a ground for piercing the corporate veil due to the shareholders’ contributing too little capital to the corporation in relation to its needs.

Nevada Corporation

A corporation chartered in the state of Nevada, often chosen for its favorable corporate laws and tax rules.

California

A U.S. state located on the West Coast of the United States, known for its diverse geography, climate, and influential entertainment industry.

Taxes

Compulsory financial charges imposed by a government on individuals or entities to fund public expenditures, providing various public goods and services.