Which of the following statements is true regarding internal controls of capital and investment processes?
A)Internal controls aimed at preventing and detecting employee fraud in capital and investment processes are not as effective.
B)Top management fraud, rather than employee fraud, is more likely to occur.
C)Any fraud is likely to involve manipulating capital and investment processes.
D)Because of top management oversight, the auditor need not review these processes.

Question

Quizplus · Accepted Answer

Top management fraud is more likely to occur in the context of capital and investment processes because such decisions often involve significant amounts of money and are usually under the direct control or influence of top management. This makes it easier for top management to manipulate these processes for personal gain or to meet certain financial targets.

Which of the Following Statements Is True Regarding Internal Controls