Fraud

question 37

Multiple Choice

Fraud:

• A) Involves deception on the part of the auditor in conducting an audit of the financial statements.
• B) Is similar to gross negligence.
• C) Is defined in the Securities Acts of 1933 and 1934.
• D) All of the above.

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Definitions:

Minority Shareholders

Individuals or entities that own less than 50% of a company's shares and therefore have limited control over company decisions.

Shareholder's Derivative Suit

A legal action brought by a shareholder on behalf of a corporation to enforce the corporation's rights when the corporation's management fails to do so.

Cumulative Voting

A voting system in corporate elections that allows shareholders to concentrate all their votes on one candidate for the board of directors.

Illegal Dumping

The improper disposal of waste at a non-approved location.