SOFA-CFE · Question #207
Control procedures can be circumvented by collusion.
The correct answer is A. True. A is correct because collusion - when two or more people secretly cooperate to commit fraud or bypass rules - is a well-known limitation of internal controls. Segregation of duties, for example, prevents a single individual from completing a fraudulent transaction alone, but if…
Question
Control procedures can be circumvented by collusion.
Options
- ATrue
- BFalse
How the community answered
(52 responses)- A81% (42)
- B19% (10)
Explanation
A is correct because collusion - when two or more people secretly cooperate to commit fraud or bypass rules - is a well-known limitation of internal controls. Segregation of duties, for example, prevents a single individual from completing a fraudulent transaction alone, but if multiple people work together, those safeguards can be defeated.
B is wrong because no control system is entirely immune to human behavior. Controls are designed assuming individuals act independently and honestly; when that assumption breaks down through coordinated deception, the control environment is compromised regardless of how well-designed it is.
Memory tip: Think of the phrase "two heads beat one lock." A control that stops one person (like requiring dual authorization) can be undermined when both authorized parties conspire - collusion is the Achilles' heel of segregation-of-duties controls.
Community Discussion
No community discussion yet for this question.