Question
Why is a segregation-of-duties failure a control problem?
Tap to flip
Answer
It lets one person authorize, record, and handle custody.
Tap to flip back
Question
What is the audit response when a control cannot be relied on?
Tap to flip
Answer
Test a compensating control or perform substantive procedures.
Tap to flip back
Question
What makes a revenue-cutoff issue a significant risk in the example?
Tap to flip
Answer
Fraud indicators plus year-end billing and management incentives.
Tap to flip back
Question
What are the three parts of the fraud triangle?
Tap to flip
Answer
Incentive or pressure, opportunity, and rationalization.
Tap to flip back