When Analyzing Accounts for Fraud Risk

question 46

Multiple Choice

When analyzing accounts for fraud risk,

• A) companies will generally attempt to overstate accounts payable and net income.
• B) the inventory account is generally not susceptible to fraud since the auditor must verify the existence of the inventory.
• C) payroll is rarely a significant risk for fraudulent financial reporting.
• D) fixed assets are rarely stolen because of their large size.

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Definitions:

Distribution

The process of making a product or service available to the consumer or business user that needs it.

Furosemide

A medication commonly used to treat fluid build-up due to heart failure, liver scarring, or kidney disease by increasing urine production.

Generic Name

The official, non-commercial name of a drug, as opposed to its branded trade name.

Opioid Pain Medication

Drugs derived from opium or synthetic analogs used to treat moderate to severe pain by acting on the nervous system.