Required information Chapter 04 Problem 4-31 LO 4-6, 4-9 [The following information applies to the questions displayed below.] Management fraud (e.g., fraudulent financial reporting) is a relatively rare event. However, when it does occur, the frauds (e.g., Enron and WorldCom) can have a significant effect on shareholders, employees, and other parties. The PCAOB's AS 2401, Consideration of Fraud in a Financial Statement Audit, provides the relevant guidance for auditors. Shapter 04 Problem 4-31 Part b LO 4-6, 4-9 . Select the three conditions that are generally present when fraud occurs: lote: You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct nswer and double click the box with the question mark to empty the box for a wrong answer. Management or other employees have an incentive or are under pressure that provides a reason to commit fraud. Circumstances exist that provide an opportunity for a fraud to be carried out. Those involved are able to rationalize committing a fraudulent act. Some individuals possess an attitude, character, or set of ethical values that allow them to knowingly and intentionally commit a dishonest act. Those involved have less than a high-school education. Those involved have no religious affiliations. Those involved are in their first year at the company