Fraudulent Financial Reporting Is a Business Reality

question 71

Multiple Choice

Fraudulent financial reporting is a business reality. While it cannot be eliminated, the risk of fraudulent reporting can be decreased. Which of the following considerations is least likely to lessen that risk?

• A) an independent audit committee
• B) an internal audit function
• C) vigilant management
• D) an increased focus on tying bonuses to short-term company performance

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Definitions:

Sequencing

The process of arranging objects, actions, or information in a specific order, often for clarity, effectiveness, or logical progression.

Low-Cost

Describing products, services, or strategies that require minimal financial outlay.

High-Risk

Situations or decisions characterized by a high possibility of loss, failure, or negative outcomes, requiring careful assessment and management.

Influence Tactics

Strategies or actions used by individuals or groups to persuade or direct the behavior or decision-making of others towards a desired outcome.