Question
Which of the following statements is not
true?Solution
Statement (b) is not true. While a robust internal control system can help reduce the likelihood of fraud, it cannot entirely eliminate the possibility of management fraud. Management fraud typically involves individuals in higher positions who may override or manipulate internal controls, making it more challenging to prevent or detect. Internal controls are important for prevention and detection, especially for employee fraud, but they may not completely eliminate the risk of management fraud.
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