ITPEC FE Subject A October 2025 Question 30
ITPEC FE Subject A October 2025 — Question 30 of 60
Fraud Triangle — three conditions for fraud: Opportunity, Pressure, Rationalization.
The fraud triangle (by Donald Cressey) states that fraud occurs when three elements coexist:
- •Opportunity — the environment (weak controls, system access, organizational rules) that makes fraud possible
- •Pressure / Incentive — external or internal force (financial problems, unrealistic targets) motivating the person
- •Rationalization — self-justification ("I deserve it", "everyone does it") that overcomes guilt
(b) correctly describes Opportunity: technologies, physical environment, and organizational rules that make fraud easy to commit.
Why not others:
- (a) "Information and communication" is a component of the COSO internal control framework, not the fraud triangle
- (c) Describes rationalization (self-justification to overcome guilt) but mislabels it as "Pressure"
- (d) Describes pressure (feeling forced by unrealistic targets) but mislabels it as "Rationalization"
Key rule: Fraud triangle = Opportunity + Pressure + Rationalization. Watch for answer choices that swap definitions between elements.
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