Which of the following would be a red flag that internal auditors should look at for the possibility of inventory fraud? I. The controller has assumed responsibility for approving all payments to certain vendors. II. The controller has continuously delayed installation of a new accounts payable system, despite a corporate directive to implement it. III. Sales commissions are not consistent with the organization's increased levels of sales. IV. Payments to vendors are supported by copies of receiving memos, rather than originals. Group of answer choices I and II only II and III only I, II, and IV only I, II, III, and IV I, III, and IV only
Which of the following would be a red flag that internal auditors should look at for the possibility of inventory fraud? I. The controller has assumed responsibility for approving all payments to certain vendors. II. The controller has continuously delayed installation of a new accounts payable system, despite a corporate directive to implement it. III. Sales commissions are not consistent with the organization's increased levels of sales. IV. Payments to vendors are supported by copies of receiving memos, rather than originals. Group of answer choices I and II only II and III only I, II, and IV only I, II, III, and IV I, III, and IV only
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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28.
Which of the following would be a red flag that internal auditors should look at for the possibility of inventory fraud?
I. The controller has assumed responsibility for approving all payments to certain vendors.
II. The controller has continuously delayed installation of a new accounts payable system, despite a corporate directive to implement it.
III. Sales commissions are not consistent with the organization's increased levels of sales.
IV. Payments to vendors are supported by copies of receiving memos, rather than originals.
Group of answer choices
I and II only
II and III only
I, II, and IV only
I, II, III, and IV
I, III, and IV only
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