CFE-Fraud-Prevention-and-Deterrence Practice Questions

A.  

Josie should report her findings to those charged with governance of the organization.

B.  

Josie should not disclose her findings to anyone until after she has conducted a full investigation.

C.  

Josie should immediately report her findings to the local media.

D.  

Josie should confront Carissa with her audit findings and try to get a confession.

A.  

Deterrence

B.  

Enforcement

C.  

Prevention

D.  

Compliance

A.  

Frauds committed by staff-level employees cause higher median losses than those committed by owners and executives.

B.  

Men and women commit similar amounts of occupational frauds.

C.  

Complaints about family problems is the most reported behavioral red flag displayed by fraud perpetrators.

D.  

Most employees who commit occupational fraud are first-time offenders.

A.  

Organizations should include in their whistleblower policies the specific penalties that people might encounter for refusing to report known misconduct.

B.  

Organizations should emphasize that rules regarding whistleblower protections are only intended for lower-level employees who might be more vulnerable to retaliation.

C.  

Organizations should implement a clear whistleblower policy that lists every type of misconduct that has ever been reported at the company.

D.  

Organizations should publicize their whistleblower policies and procedures to individuals both inside and outside of the organization.

A.  

increase in the occurrence of the undesired behavior

B.  

No effect on the occurrence of the undesired behavior

C.  

Temporary suppression of the undesired behavior

D.  

Permanent suppression of the undesired behavior

A.  

Government regulations are justified because the additional costs of regulations and bureaucratic procedures increase government profits.

B.  

Violations are caused by innocent errors in judgment rather than economic necessity.

C.  

Government regulation is unnecessary because the matters being regulated are unimportant.

D.  

Corporate violations that involve large sums of money are often spread among so many organizations that each gains very little individually.

A.  

ArtisanWare only needs to undertake due diligence procedures if EFG conducts business in countries with known corruption risks.

B.  

ArtisanWare does not need to take any specific procedures to verify EFG ' s identity before accepting the transaction.

C.  

ArtisanWare should perform the same level of due diligence as it would for any other customer to avoid claims of discrimination.

D.  

ArtisanWare should examine EFG ' s net worth as part of deciding whether to allow the purchase on credit.

A.  

The auditors should reconsider the reliability of the audit evidence they have previously obtained.

B.  

The auditors should assume that all audit evidence collected previously is unreliable and withdraw from the audit engagement.

C.  

The auditors should only consider the evidence if they can determine that the actions meet the legal definition of fraud.

D.  

The auditors should regard the misstatement as immatenal to the audit because the omitted amount is less than the quantitative materiality threshold

A.  

True

B.  

False

A.  

True

B.  

False