The Purpose of the Fraud Triangle Is to Identify

question 40

Multiple Choice

The purpose of the fraud triangle is to identify:

• A) The causes of when the audit opinion should be qualified.
• B) To identify the causes of and reasons for fraud when there may be intentional misstatements or omissions of amounts or disclosures in the financial statements.
• C) To identify the causes of when there is a lack of independence in performing an audit.
• D) All of these.

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Definitions:

Dividend Payment

A portion of a company's earnings distributed to shareholders, usually on a regular basis.

Stock Ownership

Stock ownership refers to the possession of shares in a corporation, which represents a claim on part of the company's assets and earnings.

Residual View

In corporate finance, this concept suggests that dividends should be paid from the residual or remaining equity after all project investments with positive NPV have been funded.

Dividends

Payments made by a corporation to its shareholder members, representing a portion of the corporate profits.