Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

6. Internal Controls and Reporting Cash

Fraud and the Fraud Triangle

Financial Accounting

6. Internal Controls and Reporting Cash

Fraud and the Fraud Triangle

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Multiple Choice

Which of the following is NOT one of the components of the Fraud Triangle?

Rationalization

Pressure

Recognition

Opportunity

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Verified step by step guidance

Understand the Fraud Triangle: The Fraud Triangle is a model used to explain the factors that lead to fraudulent behavior. It consists of three components: Pressure, Opportunity, and Rationalization.

Define each component: Pressure refers to financial or personal stress that motivates someone to commit fraud. Opportunity is the ability to commit fraud due to weak controls or oversight. Rationalization is the justification or reasoning the fraudster uses to make their actions seem acceptable.

Analyze the options provided: The options are Rationalization, Pressure, Recognition, and Opportunity. Compare each term to the components of the Fraud Triangle.

Identify the term that does not belong: Recognition is not a component of the Fraud Triangle. It does not align with the model's explanation of fraudulent behavior.

Conclude the answer: The correct answer is Recognition, as it is not one of the three components of the Fraud Triangle (Pressure, Opportunity, Rationalization).