Skip to ContentGo to accessibility pageKeyboard shortcuts menu
OpenStax Logo

Multiple Choice

1.

C

3.

A

5.

D

7.

C

9.

A

11.

A

13.

B

15.

C

17.

B

19.

C

Questions

1.

Examples include weak internal controls, improper or nonexistent management oversight, and lack of an internal audit function or other opportunities that create the perception that the fraudster will be successful in committing a fraudulent act.

3.

Examples include vices such as gambling, living beyond one’s means, high debts, employer pressures to report fictitious accounting results, or alcohol/drug use.

5.

Protect data from corruption or damage. Have their servers mirrored at various locations around the world. Ensure that no unauthorized parties have access to the data. Ensure that all transactions are entered into the accounting system properly and accurately. If fraud or illegal access to data occurs, a good internal control will help identify the responsible party or parties.

8.

To ensure that large companies are consistent with internal controls, properly documented, and tested.

10.

One person should be responsible for the fund. If one person is in charge and the fund is short, then the petty cashier is the only one responsible for the shortage.

11.

Records all sales and inventory reduction and ensures that correct prices are charged.

13.

All differences must be researched, explained, and corrected. Differences pertaining to the bank must be reported. If fraud is suspected, a complete investigation must be performed.

Citation/Attribution

This book may not be used in the training of large language models or otherwise be ingested into large language models or generative AI offerings without OpenStax's permission.

Want to cite, share, or modify this book? This book uses the Creative Commons Attribution-NonCommercial-ShareAlike License and you must attribute OpenStax.

Attribution information
  • If you are redistributing all or part of this book in a print format, then you must include on every physical page the following attribution:
    Access for free at https://openstax.org/books/principles-financial-accounting/pages/1-why-it-matters
  • If you are redistributing all or part of this book in a digital format, then you must include on every digital page view the following attribution:
    Access for free at https://openstax.org/books/principles-financial-accounting/pages/1-why-it-matters
Citation information

© Jul 16, 2024 OpenStax. Textbook content produced by OpenStax is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike License . The OpenStax name, OpenStax logo, OpenStax book covers, OpenStax CNX name, and OpenStax CNX logo are not subject to the Creative Commons license and may not be reproduced without the prior and express written consent of Rice University.