IIA Exam IIA-IAP Topic 5 Question 4 Discussion

Actual exam question for IIA's IIA-IAP exam

Question #: 4
Topic #: 5

Which of the following scenarios would be the strongest indicator of fraud in an accounts payable process?

AThe accounts payable manager was unable to provide documentation relating to travel expenses on one of the samples selected.

BThe invoices submitted by one of the organization's vendors are more than six months old.

CThe address on one of the vendor invoices matches an employee's residential address.

Show Suggested Answer

Suggested Answer: C

Comprehensive and Detailed Step-by-Step Explanation:

Address Matches an Employee's Residence: This is a strong indicator of fraud, as it suggests the possibility of a fictitious vendor created to divert funds to the employee.

Other Options:

Option A: Missing documentation may indicate poor record-keeping but is not a strong indicator of fraud on its own.

Option B: Delayed invoices might indicate inefficiencies, not fraud.

Thus, the correct answer is C. The address on one of the vendor invoices matches an employee's residential address.

by Louvenia at Jan 27, 2025, 07:16 AM

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