CMA Final · Cost and Management Audit · Forensic Audit
Under the fraud triangle, a purchase manager at an Indian firm inflates vendor invoices because he believes the company's weak approval controls will never detect it. Which element of the fraud triangle does this belief represent?
This is the opportunity element. Opportunity arises when weak internal controls, such as poor approval or review procedures, let the person believe the fraud can be committed and remain undetected. Pressure is the motive and rationalisation is self-justification, so neither describes this belief.
- AOpportunityCorrect
- BPressure
- CRationalisation
- DCapability
Explanation
The belief that weak controls will not detect the act reflects the perceived opportunity created by control weaknesses. Pressure is the motive, such as debts. Rationalisation is the self-justification of the act. Capability belongs to the fraud diamond, not the triangle.
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