Of the following examples of fraud,which will be the most difficult to prevent and detect? Assume the company enforces adequate segregation of duties.
A) A mail room employee steals a check received from a customer and destroys the documentation.
B) The accounts receivable clerk does not record sales invoices for friends or family, so they can receive free goods.
C) An employee puts inventory behind the dumpster while unloading a vendor's delivery truck, then picks up the inventory later in the day and puts it in her car.
D) Mike issues credit cards to him and Maxine, and when the credit card balances are just under $1,000, Maxine writes off the accounts as bad debt. Mike then issues new cards.

Question

Quizplus · Accepted Answer

This type of fraud involves collusion between two individuals and can be difficult to detect without proper monitoring and oversight. In this scenario, the fraud involves issuing fraudulent credit cards and writing off the balances as bad debt. It may require analyzing patterns and reviewing documentation to uncover this fraud. However, if proper controls are in place, such as regular review of credit card statements and monitoring of bad debt write-offs, this fraud can be prevented or detected in a timely manner. The other options (A, B, and C) involve more straightforward theft or embezzlement and can be prevented or detected through segregation of duties and regular audits.

Of the Following Examples of Fraud,which Will Be the Most