Inventory Theft Detection: Important Counts for Fraud Prevention

Important Counts for Inventory Theft Detection

Question

Which counts sometimes can give rise to inventory theft detection?

Answers

Explanations

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A. B. C. D.

B

The answer to this question is B. Physical inventory counts.

Physical inventory counts are an essential tool for detecting inventory theft because they provide an accurate measurement of the amount of inventory on hand. These counts involve physically counting the number of items in inventory, and comparing that count to the amount of inventory recorded in the company's books and records. Any discrepancies between the physical count and the recorded count could indicate the presence of inventory theft.

Perpetual inventory counts, on the other hand, are ongoing, real-time counts of inventory that are updated as transactions occur. While they can be useful for tracking inventory levels, they may not provide an accurate representation of inventory on hand, as errors and discrepancies can accumulate over time.

Concealment inventory counts are not a recognized inventory counting method and are not relevant to detecting inventory theft.

In summary, physical inventory counts are an effective tool for detecting inventory theft, as they provide an accurate measurement of inventory on hand and allow for the identification of any discrepancies between the physical count and the recorded count.