How does organizational structure contribute to fraud according to the provided concepts?

Organizational structure can significantly impact the likelihood of fraud occurring within a company, and this option correctly highlights a crucial aspect. When departments within an organization are isolated from one another, it leads to a lack of oversight and reduced transparency. This segregation can create an environment where employees feel unmonitored and may engage in fraudulent activities without the fear of detection.

Isolated departments can also limit cross-functional audits and checks that are vital for identifying discrepancies and ensuring accountability. The absence of thorough communication across departments can further exacerbate the problem, as employees may not be aware of the processes in place or the expectations for oversight.

In contrast, promoting transparency and communication, incentivizing ethical behavior, and increasing training opportunities contribute to a healthy organizational environment that minimizes the risk of fraud. These practices foster an atmosphere of integrity, where employees are educated about ethical standards, motivated to adhere to them, and encouraged to share information that could prevent or detect fraudulent activity.