QUESTION: 125

Which ONE of the following statements is true?

It is the responsibility of the internal auditors to detect fraud
It is the responsibility of the external auditors to detect fraud
It is the responsibility of the management to detect fraud
It is the responsibility of the shareholders to detect fraud

Answer(s): A

Refer to the exhibit.

The following information is available in respect of two companies that operate in the same market sector:

Which one of the following statements most accurately describes the companies' relative position?

Company A has the shortest working capital cycle and the best control on both inventories and payables.
Company B has the shortest working capital cycle and the best control on both inventories and payables.
Company A has the shortest working capital cycle and the best control on inventories.
Company B has the shortest working capital cycle and the best control on payables and receivables.

Answer(s): D

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QUESTION: 127

Which one of the following would not contribute to the prevention and detection of fraud?

Appointing a single well-qualified person to maintain the ledger accounts
Conducting an audit
Insisting that staff take holidays
Segregating the duties of staff

Answer(s): A

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QUESTION: 128

Refer to the Exhibit.

A company which is not VAT-registered received an invoice for vehicle repairs of $650 excluding VAT. The rate of VAT on the invoice was 17.5%.

Which of the following ledger entries to record the invoice are correct?
The correct ledger entries are.

Answer(s): B

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QUESTION: 128