Comprehensive and Detailed Step-by-Step Explanation:
* Reference to IIA Standards:
* Standard 1210.A2: Internal auditors must have sufficient knowledge to evaluate the risk of fraud and the manner in which it is managed by the organization.
* They are not expected to have the expertise of a fraud examiner or forensic investigator.
* Reasoning:
* Option B is correct because internal auditors need enough knowledge to assess fraud risks and provide assurance over controls designed to mitigate those risks.
* Option A overstates the requirement, as fraud detection and investigation require specialized expertise typically outside the scope of general internal auditing.
* Option C refers to control development, which is a management responsibility, not an internal audit role.
* Role of Internal Audit in Fraud:
* Auditors evaluate fraud risks and provide recommendations to improve controls, ensuring alignment with organizational risk management strategies.