Financial statement fraud is:

Question

Quizplus · Accepted Answer

Financial statement fraud involves intentionally or grossly-negligently violating GAAP and then failing to disclose this violation in financial statements. The violation must also materially affect the financial statements to be considered fraud. Therefore, option B is the correct answer. Option A is incorrect because it is referring to misrepresenting another company's financial statements, not committing fraud with one's own statements. Option C is incorrect because it is missing the requirement that the violation must be material in order to constitute fraud. Option D is incorrect because the CEO and CFO signing the financial statements is not necessarily indicative of fraud.

Financial Statement Fraud Is