Course ACC315_30_Fraud Prevention £¢ Examination_2022_23_TERM5 Test Unit 1 HWZ Starts: 3110/23 4:l 7 PM Submitted 3110/23 4:42 PM Stats: Needs Grading Attemct Score Grade not available. Time Elacsed 24 minutes {esdlts DisplayedAll Answers Question 1 Submitted Answers, Correct Answers. Feedback. Incorrectly Answered Questions Needs Grading Explain the fraud triangle. eel Selected Answer: Correct Answer: Response Feedback: The fraud triangle is a concept that was developed by criminologist Donald Cressey to explain the three key factors that must be present for fraud to occur. These three factors are motive opportunity and rationalization. Motive The first point of the fraud triangle is motive The employee must have a perceived non-sharable financial need that cannot be discussed with anyone out of fear of loss of status or reputation This financial need is often driven by somesort of vice such as drugs gambling' orgreed that led them to want more money Opportunity The second point of the fraud triangle is opponunity The employee must have knowledge of the system and its weaknesses that can be exploited to hide the fraud They mustalso believe thatthey vnll not get caught in the act Rationalization The third point of the fraud triangle is rationalization The employee must justify their fraudulent actions in their minds They may convince themselves that they are entitled to the money orthat the company owes it to them Asthe fraud continues they may lose track of the amount taken and the fraud takes over their life All three points of the fraud triangle need to be in place for fraud to occur. Therefore organizations can combat fraud by addressing these three points For example they can create a culture of ethical behavior establish strong internal controls. and increase transparency in financial transactions Ey addressing these factors organizations can reduce the likelihood of fraud occurring The fraud triangle consists of three point and all these points need to be in place for fraud to occur The first point is motive The employee has a perceived nonrsharable financial need They cannotdiscuss this financial need with anyone out offear of loss of status: either in a social situation or a business situation The financial need comes from some sort of vice drugs gambling or the son orjust greed that ledthem to want more money The second point is opponunity The employee knows the system, the weaknesses they can use to hide the fraud and believes mey won't get caught The third point is rationalization The employee does not think they are committing a crime They justify the fraud in their mindsAs thefraud continues they become so involved they loose track ofthe amount taken and theiraud takes over their life. [None Given]
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