Identify if the scenario is a fraud risk factor relating to misstatements arising from fraudulent financial reporting or fraud risk factors relating to misstatements arising from misappropriation of assets and the associated condition generally present when fraud occurs. Factors include:
i. Attitudes/rationalizations – Misstatements arising from misappropriation of assets
ii. Attitudes/rationalizations – Misstatements from fraudulent financial reporting.
iii. Incentives/pressure – Misstatements arising from misappropriation of assets
iv. Incentives/pressures – Misstatements from fraudulent financial reporting
v. Opportunities – Misstatements arising from misappropriation of assets
vi. Opportunities – Misstatements from fraudulent financial reporting
vii. Does not Apply
Scenarios
1. Significant related-party transactions not in the ordinary course of business
2. Promotions, compensation, or other rewards inconsistent with expectations
3. Significant bank accounts in the tax-haven jurisdictions for which there appears to be no clear business justification
4. Large amounts of cash on hand or processed