Concept Introduction:
- Ethics:
The ethics can be defined as the beliefs of a person that helps him to distinguish between right decisions and wrong decisions or right paths or wrong paths.
- Fraud triangle:
A fraud triangle can be defined as framework designed to explain the reasoning behind a person's decision to commit fraud at workplace. The stages of reasons for fraud can be − prevention, opportunity and rationalisation.
- Prevention:
It is way to arrange things or manage things that will give the least scope to any fraud.
- Internal controls:
Internal controls are the processes that make sure that things are done in such a way that would ensure the integrity of financial and accounting fraud and they will also help in preventing frauds.
- Sarbanes-Oxley Act:
This act focus on proper documentation and verification of well-planned internal controls set-up in the organization
- Audit:
Audit ensures that financial statements and prepared in accordance with GAAP or not.
- Dodd-Frank Act:
According to this act, SEC pays 10 % to 30 % of sanctions exceeding $ 1 million.
To match:
The given phrases or terms to with the given descriptions −
Given phrases −
- Ethics:
- Fraud triangle
- Prevention
- Internal controls
- Sarbanes-Oxley Act
- Audit
- Dodd-Frank Act
Given description −
- Requires the SEC to pay whistle-blowers
- Examines whether financial statements are prepared using GAAP, it does not ensure absolute accuracy of the statement.
- Requires documentation and verification of internal controls and increases emphasis on internal control effectiveness.
- Procedures step to protect company property and equipment, ensure reliable accounting, promote efficiency, and encourage adherence to policies.
- A less expensive and more effective means to stop fraud
- Three factors push a person to commit fraud: opportunity, pressure; and rationalization
- Beliefs that distinguish right from wrong

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Chapter 1 Solutions
FUND OF ACCT PRIN(LOOSE-LEAF)+ACCESS
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