When auditing the award of a major contract, which of the following should an internal auditor suspect as a red flag for a bidding fraud scheme?
1.Subsequent change orders increase requirements for low-bid items. 2.Material contract requirements are different on the actual contract than on the request for bids. 3.A high percentage of employees are charged to indirect accounts.
4.Losing bidders are hired as subcontractors.
A. 1 only
B. 2 only
C. 1 and 3.
D. 2 and 4.