Question

Which of the following policies is most likely to result in an environment conducive to the occurrence of fraud?

A. The application of some accounting controls on a sample basis.
B. Unreasonable sales and production goals.
C. The division's hiring process frequently results in the rejection of adequately trained applicants.
D. Budget preparation input by the employees who are responsible for meeting the budget.

Answer 1

Unreasonable sales and production goals can create an environment conducive to fraud. So, the correct answer is option B

Step-by-step explanation:

The policy most likely to result in an environment conducive to the occurrence of fraud is B. Unreasonable sales and production goals. When organizations set unrealistic targets for sales and production, there may be a temptation for employees to engage in fraudulent activities to meet those goals. This can lead to unethical practices such as misrepresenting financial information, inflating sales figures, or conducting unauthorized transactions.

So, the correct answer is option B.