Identify the True Statement About Detecting Fraud Using Financial Statement

question 32

Multiple Choice

Identify the true statement about detecting fraud using financial statement reports.

• A)Performing horizontal analysis requires converting the Income statement balances to percentages of gross sales.
• B)Vertical analysis is the most direct method of focusing on changes from period to period.
• C)Before performing any data-driven analysis that targets fraud and corruption in financial statements, the numbers in all three types of financial statements need to be converted to percentages.
• D)Small frauds may not affect the summarized financial statements significantly to be detected.

---

Definitions:

Lower-SES Backgrounds

Refers to individuals or families from lower socioeconomic status, often facing challenges such as limited access to education, healthcare, and economic opportunities.

Cross-Cultural Investigation

Research that examines the similarities and differences across various cultures to understand how cultural context influences behaviors, values, and attitudes.

Individualism

A cultural orientation that emphasizes the importance of self-reliance, personal freedom, and individual achievement, often over communal or societal goals.

Collectivism

A cultural value or social outlook that emphasizes the importance of groups and the collective, over individual action or identity.