Which of the following statements relating to the prevention and detection of fraud is most correct?

1. The auditor's responsibility for the prevention and detection of fraud is an important factor in understanding the audit expectation gap.
2. The auditor is normally more concerned with misappropriation of assets than fraudulent financial reporting.

Required: Answer in the space below:

i. Which of the two options (A or B) is correct.

ii. Why the response selected is correct.

ili. Why the response not selected is incorrect.