Which of the following is the best reason for management to emphasize fraud prevention and deterrence?
A) It is often more effective and economical for companies to focus on fraud prevention and deterrence rather than on fraud detection.
B) Collusion is impossible to detect.
C) The AICPA requires management to implement a fraud prevention program.
D) All of the above are equally valid reasons.

Question

Quizplus · Accepted Answer

Emphasizing fraud prevention and deterrence is often more effective and economical for companies because it can prevent fraud from occurring in the first place, rather than waiting to detect it after it has already happened. Collusion may be difficult to detect, but it is still possible to implement measures that can prevent or deter it. The AICPA does encourage fraud prevention programs, but this is not the most compelling reason for management to emphasize fraud prevention and deterrence.

Which of the Following Is the Best Reason for Management