Certified Internal Auditor (CIA) Part 1: Business Acumen — Question 180

An organization's project managers regularly travel to various destinations. Although plane tickets and accommodations are booked and paid for by the organization, project managers can still submit for reimbursement any travel-related receipts for transportation, dining, and other miscellaneous costs. Which of the following fraud schemes should the auditor test for?

Answer options

• A. Multiple and overstated expenses.
• B. Unauthorized expenditures.
• C. Improper period recognition of expenses.
• D. Concealed liabilities and expenses.

Correct answer: A

Explanation

The correct answer is A, as project managers submitting multiple or inflated expenses is a common fraud risk in reimbursement processes. Options B, C, and D may also represent potential issues, but they are less likely in this specific context where travel expenses are routinely submitted for reimbursement.