Question: While auditing a client, the CEO asks you to look carefully at cash flows. You notice that cash flows have decreased every year. On learning

While auditing a client, the CEO asks you to look carefully at cash flows. You notice that cash flows have decreased every year. On learning of your findings, the CEO remarks,

I seem to bring in more customers every year, but the cash is not there.

You tell him that fraud may be occurring, and he asks you to investigate. You agree, and after some research decide that the most likely place for fraud to be occurring is in the cash collections.

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