The primary responsibility for preventing fraud in an organization lies with
A) The audit committee of the board of directors.
B) The internal audit function.
C) The external auditor.
D) The organization's management.

Question

Quizplus · Accepted Answer

The primary responsibility for preventing fraud in an organization lies with its management. It is the responsibility of the management to design and implement a system of internal controls that will prevent and detect fraud. The management should also create a culture of ethical behavior by clearly communicating its expectations and code of conduct to all employees. While the audit committee of the board of directors, the internal audit function, and the external auditor all play a role in preventing fraud, the ultimate responsibility lies with management.

The Primary Responsibility for Preventing Fraud in an Organization Lies