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 the most common risk management technique used to prevent fraud according to the fraud triangle framework?

Increasing financial incentives

Relying solely on employee trust

Eliminating all opportunities for error

Implementing internal controls

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Verified step by step guidance

Understand the fraud triangle framework, which consists of three elements: opportunity, pressure, and rationalization. Fraud occurs when these three elements are present.

Recognize that the most effective way to prevent fraud is to address the 'opportunity' element of the fraud triangle. This involves reducing or eliminating opportunities for fraudulent behavior.

Learn that internal controls are systematic measures implemented within an organization to safeguard assets, ensure accurate financial reporting, and prevent fraud by reducing opportunities for error or misconduct.

Examples of internal controls include segregation of duties, regular audits, access controls, and reconciliations. These measures help ensure accountability and transparency in financial processes.

Conclude that implementing internal controls is the most common and effective risk management technique used to prevent fraud, as it directly targets the opportunity element of the fraud triangle.