CFE-Fraud-Prevention-and-Deterrence Practice Questions

A.  

In conducting the audit, Alicia’s objectives are likely narrower than those of a private-sector financial statement audit.

B.  

Alicia must comply with the requirements found in International Standard on Auditing 240 as they apply to both private- and public-sector audits.

C.  

Alicia should focus on potential fraud and does not need to consider the possibility of abuse or other misconduct during the audit engagement.

D.  

If Alicia identifies fraud during the audit engagement, she must immediately withdraw from the engagement.

A.  

A fraud examiner accepts an assignment to evaluate the anti-fraud controls at an organization in which they are a shareholder after disclosing their shareholder status.

B.  

A fraud examiner refuses an assignment to infiltrate a company and transmit inside information to another party at a competing organization.

C.  

A fraud examiner gathers evidence for a freelance fraud examination engagement during the time they should be working for their full-time employer’s business.

D.  

A fraud examiner undertakes an external engagement to conduct a fraud examination for one side in a case involving alleged vendor overbilling.

A.  

Continuous audit techniques

B.  

Proactive data analysis techniques

C.  

Employee background checks

D.  

Whistleblower hotline

A.  

To ensure the independence of the team members, a consultant or another external party must conduct the fraud risk assessment.

B.  

If the individuals conducting the fraud risk assessment believe that fraud could not happen within the organization, then the assessment process should reflect that belief.

C.  

The fraud risk assessment can be conducted effectively by people inside or outside of the organization.

D.  

The fraud risk assessment is most effective when management ' s influence on the process is limited.

A.  

" How can I prevent someone from learning what I did? "

B.  

" How likely am I to be punished for this crime? "

C.  

" Will I lose my job if my actions are discovered? "

D.  

" What will my parents think if they find out? "

A.  

Crime originates from a rational and conscious decision made by the perpetrator in order to receive an intended benefit.

B.  

Crime originates from an instinctual response to external stimuli without any rational or conscious decision by the perpetrator.

C.  

Crime can be deterred by increasing the personal benefit to potential perpetrators.

D.  

Crime can be deterred by decreasing the personal risk to potential perpetrators.

A.  

Ethical culture is one of the primary components of internal control identified in the Framework.

B.  

Determining the effectiveness of an organization’s internal control system involves assessing whether all of the identified components are operating together in an integrated manner.

C.  

Determining the effectiveness of an organization’s internal control system involves assessing whether the identified components meet minimum regulatory requirements.

D.  

The Framework identifies 12 components of internal control that must all be in place for the internal control system to be effective.

A.  

Criminal behavior is learned using the same mechanisms as other learning.

B.  

Criminal behavior is learned through a process that is the same as imitation.

C.  

Criminal behavior is explained by an individual ' s general needs and values.

D.  

Criminal behavior is acquired through casual interactions in large groups.

A.  

An organization should subject vendors to an internal audit conducted by the organization ' s own auditors before agreeing to do business with them.

B.  

An organization should avoid revealing that it is seeking information about potential vendors prior to starting a relationship with them.

C.  

An organization should request that new vendors fill out a questionnaire about their background immediately after signing a contract with them.

D.  

An organization should include a clause in the contract requiring the vendor to report any misconduct before entering into an agreement with them.

A.  

True

B.  

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