Which of the Following Is the Most Likely Reason Fraud

question 40

Multiple Choice

Which of the following is the most likely reason fraud within a company is detected?

• A) Internal audits are conducted both routinely and unexpectedly.
• B) External auditors have become more knowledgeable in how to look for fraud.
• C) Internal controls have become more sophisticated.
• D) Employees who have suspicions about possible fraud report them.

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Definitions:

Liabilities

Financial obligations or debts that a company owes to others.

Debt

Money owed by one party to another under the condition of repayment, often including interest charges.

Profitability

The capability of a business to generate earnings greater than its expenses over a specific period, resulting in a profit.

Liabilities To Stockholders' Equity

Liabilities to Stockholders' Equity ratio indicates the financial leverage of a company, comparing the total liabilities to the total stockholders' equity to assess financial health.