Which of the following statements best describes corporate governance with respect to fraud?
1. Auditors are primarily responsible for the detection of fraud, the Board of Directors for the deterrence of fraud and management for the prevention of fraud.
2. An auditor is primarily responsible for the detection, prevention, and deterrence of fraud acts at the organization under audit.
3. The corporate governance fabric includes management, internal and external auditors but excludes the Board of Directors because executive management reports to the Board.
4. Management is primarily responsible for adopting sound accounting policies and ensuring the fair presentation of financial performance, results of operations and the financial condition of the company.