CFE-Fraud-Prevention-and-Deterrence Practice Questions

A.  

Analytical review of the financial statements is best used to uncover small frauds that might be missed by other detection methods.

B.  

Fraud assessment Questioning techniques are most appropriately used when attempting to determine who might be responsible for a particular fraud scheme.

C.  

Implementing proactive fraud audit procedures demonstrates the organization ' s intention to aggressively look for possible fraudulent conduct.

D.  

Surprise audit procedures are an effective fraud detection mechanism, but they do not help prevent fraud

A.  

Internal auditors

B.  

The compliance function

C.  

Management

D.  

External auditors

A.  

Tips

B.  

Internal audit

C.  

External audit

D.  

Management review

A.  

One of the main objectives of a fraud risk assessment is to provide an estimate of the total amount of money that an organization has lost to fraud since it was first formed.

B.  

One of the main objectives of a fraud risk assessment is to determine the organization’s vulnerabilities to both internal and external fraud.

C.  

A fraud risk assessment should focus on evaluating only the entity-level fraud risk without regard to any specific individuals or positions within the organization.

D.  

A fraud risk assessment should focus on designating areas as high risk only if the team discovers conclusive evidence that fraud has occurred.

A.  

Removing ethics-based metrics from performance evaluations to keep the focus on quantitative factors.

B.  

Giving employees sole responsibility for identifying their own training needs and performance deficiencies.

C.  

Providing formal job descriptions so that employees have well-defined responsibilities and expectations.

D.  

Evaluating employee performance solely based on an individual’s productivity and profit contributions.

A.  

Demote employees who continue to have reconciliation discrepancies.

B.  

Publicly praise employees every time their cash drawers are balanced.

C.  

Deduct an hour ' s worth of pay for anyone whose cash drawer is not perfectly reconciled each day.

D.  

Take away an hour of paid time off from an employee each time their cash drawer is not balanced.

A.  

To inform the development of audit programs for areas that have been identified as having a high risk of fraud.

B.  

To confirm whether there is conclusive evidence that fraud is occurring within the company.

C.  

To validate whether the organization is appropriately managing moderate-to-high fraud risks.

D.  

To design audit tests to evaluate whether fraud risk controls are operating effectively.

A.  

The most commonly reported red flag displayed by fraud perpetrators prior to the detection of their crime is complaints about management.

B.  

Mote occupational frauds are committed by men than by women

C.  

The median losses caused by executives are lower than those caused by staff-level employees

D.  

The majority of fraudsters have been previously punished by an employer for a fraud-related offense

A.  

Embezzling customer payments.

B.  

Adding ghost employees to payroll.

C.  

Reporting revenue in the wrong period.

D.  

Collusion between contractors.

A.  

The assessment team would like to observe the interactions of several employees discussing the organization’s current fraud awareness training.

B.  

The assessment team would like to get candid one-on-one feedback from employees in a private setting.

C.  

The assessment team would like to provide a means for anonymous employee suggestions or responses to questions posed.

D.  

The assessment team would like to obtain individuals’ responses through a formal electronic questionnaire.