Fraud Is More Prevalent in Smaller Businesses and Not-For-Organizations Because

question 73

Multiple Choice

Fraud is more prevalent in smaller businesses and not-for-organizations because it is more difficult for them to maintain:

• A) adequate separation of duties.
• B) adequate compensation.
• C) adequate financial reporting standards.
• D) adequate supervisory boards.

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Definitions:

Hypothesis

A proposed explanation made on the basis of limited evidence as a starting point for further investigation.

Evidence

Information or facts that are used to support the validity of a statement or argument.

Interpretation

An expression of the meaning or significance of a wide variety of experiences, situations, data, events, judgments, conventions, beliefs, rules, procedures, or criteria.

Inference

Identifies and secures elements needed to draw reasonable conclusions; it forms conjectures and hypotheses, it considers relevant information, and it reduces or draws out the consequences flowing from data, statements, principles, evidence, judgments, beliefs, opinions, concepts, descriptions, questions, or other forms of representation.