In Which of the Following Circumstances Would an Internal Auditor

question 30

Multiple Choice

In which of the following circumstances would an internal auditor not need to search for other signs of fraud?

• A) The organization has an unusually high increase in costs.
• B) There are several substantial weaknesses with the internal control structure.
• C) Management institutes a policy of paying vendors promptly in order to avoid incurring penalty charges.
• D) One of the employees seems to have had a dramatic increase in their standard of living.

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Definitions:

Non-Value-Added Cost

Expenses that do not contribute to the value or functionality of a product or service, often targeted for reduction or elimination.

Market Research

The process of gathering, analyzing, and interpreting information about a market, including the product or service's potential customers and competitors.

Advertising Campaigns

Organized series of promotional efforts aimed at a specific target audience over a particular timeframe to achieve predefined marketing objectives.

Market Development

A growth strategy where a business seeks to sell its existing products into new markets to attract additional customers.