Which of the Following Is Not a Potential Fraud Indicator

question 68

Multiple Choice

Which of the following is not a potential fraud indicator in the acquisition and payment cycle?

• A)Expenses that are significantly above or below industry norms.
• B)Expense accounts that have significant debit entries.
• C)Unexpected increases in gross margin.
• D)Capital assets that seem to be growing faster than the business.

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Definitions:

Prospectus

An official document issued by companies that are offering securities for sale to the public, detailing the investment’s objectives, risks, and financial statements.

Securities

Financial instruments that represent an ownership position, a creditor relationship, or rights to ownership, such as stocks, bonds, and options.

Conflict of Interest

A situation in which an individual's personal interests could potentially influence or appear to influence their professional judgment or responsibilities.

Shareholders' Meeting

A gathering of a company's shareholders, designed to inform them of the company's performance, elect the board of directors, and make decisions on corporate matters.