Which statement is not true?

1) With one exception, agent transactions improperly recorded as principal transactions affect gross operations, but do not generally have an impact on profits or loss, unless the transactions overlap accounting periods.

2) Cash always exchanges hands in round-trip transactions.

3) Phony revenue and expenses schemes have a large effect on net profit

4) To attempt to disguise the transaction, round-tripping is sometimes carried out through subsidiaries or other affiliates used as intermediaries.