Question

Separation of duties to prevent an individual from embezzling money from a company. To embezzle funds successfully, an individual would need to recruit others to commit an act of ________.

A. misappropriation
B. misuse
C. collusion
D. fraud

Answer 1

Separation of duties is a key internal control measure used by companies to prevent fraud and embezzlement. Collusion refers to the act of two or more individuals conspiring to commit a fraudulent act.

Step-by-step explanation:

The correct answer is C. collusion. Separation of duties is a key internal control measure used by companies to prevent fraud and embezzlement. It involves dividing critical tasks among different individuals to ensure that no single person has complete control over financial activities. By assigning different roles and responsibilities to multiple employees, companies create a system of checks and balances that reduces the risk of fraudulent activity.

In the context of embezzlement, collusion refers to the act of two or more individuals conspiring to commit a fraudulent act. In order to successfully embezzle funds from a company, an individual may need the assistance of other employees to help cover up the crime, manipulate financial records, or bypass internal controls.

For example, an employee responsible for accounting may collude with another employee who has access to the company's banking systems. They may work together to create fake invoices, manipulate financial records, and divert funds for personal gain.