IIA Exam IIA-IAP Topic 4 Question 2 Discussion

Comprehensive and Detailed Step-by-Step Explanation:

Living Beyond Means: This is a classic red flag for potential fraud. It suggests that the officer may be using unauthorized funds to support an extravagant lifestyle, particularly when they have access to a cash fund with limited oversight.

Other Options:

Option A: Lack of professional qualifications may affect competence but is not directly linked to fraudulent behavior.

Option C: Silence about operations may reflect confidentiality requirements rather than misconduct.

Thus, the correct answer is B. The officer appears to be living beyond his means.