Which of the Following Conditions Identified During the Audit Increases

question 47

Multiple Choice

Which of the following conditions identified during the audit increases the risk of employee fraud?

• A)Large amounts of cash in the bank.
• B)Existence of a mandatory vacation policy for employees performing key functions.
• C)Inventory items of small size,but high value.
• D)Presence of reconciling items on a client prepared year-end proof of cash.

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Definitions:

Periodic Interest Rate

The interest rate applied to a financial product or loan over a specific period, less than a year, reflecting the frequency of compounding.

Missing Value

Refers to the absence of data in a dataset or a variable in an equation or formula.

Missing Value

A data point that is lost or not recorded in a dataset or experiment.

Compounded Monthly

Interest on an investment calculated each month on the principal and previously earned interest.