Which of the following conditions identified during the audit increases the risk of employee fraud?
A)Large amounts of cash in the bank.
B)Existence of a mandatory vacation policy for employees performing key functions.
C)Inventory items of small size,but high value.
D)Presence of reconciling items on a client prepared year-end proof of cash.

Question

Quizplus · Accepted Answer

Inventory items that are small in size but high in value are easier to misappropriate without detection, increasing the risk of employee fraud.

Which of the Following Conditions Identified During the Audit Increases