Certified Internal Auditor (CIA) Part 2: Practice of Internal Auditing — Question 259

Which of the following actions by management would reduce an employee's opportunity to commit fraud?

Answer options

• A. Establishing physical controls over company assets.
• B. Eliminating bonuses tied to sales or other performance goals.
• C. Defining ethical behavior expectations in the company handbook.
• D. Identifying consequences, such as termination, for fraudulent activities.

Correct answer: A

Explanation

The correct answer, A, highlights the importance of physical controls, which can prevent unauthorized access to company assets and thereby reduce opportunities for fraud. Options B and C, while important for moral and motivational aspects, do not directly limit access or opportunities to commit fraud. Option D addresses consequences but does not prevent the act itself from occurring.