Which of the following would be considered a fraud scheme to understate financial performance?
A) Unauthorized shipments
B) Channel stuffing
C) Misclassification of revenue
D) Expense cutoff

Question

Quizplus · Accepted Answer

Misclassification of revenue is a fraud scheme to understate financial performance because it involves recording revenue before it is earned, which reduces the company's reported expenses and increases its reported profits.

Which of the Following Would Be Considered a Fraud Scheme