If employees are aware that surprise cash counts are conducted, they will generally be less inclined to commit a cash larceny scheme.

• A. True
• B. False
• C. It reduces but does not eliminate
• D. It only works if counts are announced

Answer: (A)

Deterrence through detection risk is the idea behind surprise cash counts. When employees know counts can occur with little or no warning, the chance of catching a discrepancy rises, so the expected gain from stealing decreases. This increased risk makes cash larceny less attractive on average, so the statement is true. It's not a guarantee—someone determined might still attempt it—but surprise counts are a strong discouragement. If counts were announced, the deterrent effect would be weaker because theft could be timed around those checks.