Which of the following, if observed, would not indicate the need to extend the search for other indicators of fraud in a purchasing department?
A) The standard of living of one of the purchasing agents has increased.
B) The internal control structure has significant weaknesses.
C) The purchasing agents have convinced management to adopt a policy of paying vendors on a more timely basis in order to avoid incurring penalty charges.
D) The cost of goods procured seems to be excessive in comparison with previous years.

Question

Quizplus · Accepted Answer

Convincing management to adopt a policy of paying vendors more timely to avoid penalties is a legitimate business decision and does not inherently indicate fraud.

Which of the Following, If Observed, Would Not Indicate the Need