Financial Statement Fraud Often Involves

question 2

Multiple Choice

Financial statement fraud often involves:

• A) A high level financial executive
• B) Large dollar amounts
• C) The collusion of two or more employees
• D) All of the above

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Definitions:

Extremity Bias

A cognitive bias where individuals tend to remember and give disproportionate weight to the most extreme examples or experiences.

Law of Small Numbers

A cognitive bias that leads people to draw broad conclusions from small data sets or limited information.

Outgroup Heterogeneity Bias

The tendency to view members of an out-group as more diverse and individual than members of one's own in-group.

Ingroup Differentiation Bias

Ingroup differentiation bias is the tendency to perceive and highlight differences within one’s own group, emphasizing diversity and individuality among members.