Question 1

According to the Sarbanes-Oxley legislation, current changes to, or waivers of codes of ethics should be disclosed on:

Accepted Answer

A)  Form 10-K. 
B)  Form 1120. 
C)  Form 8-K. 
D)  Form 10-Q. 
A)  Form 10-K. 
B)  Form 1120. 
C)  Form 8-K. 
D)  Form 10-Q.

Question 2

What is the most important element in a control environment?

Accepted Answer

A)  Management's communication 
B)  Management's role and example 
C)  The hiring process 
D)  The internal audit department 
A)  Management's communication 
B)  Management's role and example 
C)  The hiring process 
D)  The internal audit department

Question 3

Which of the following is NOT a common financial pressure associated with fraud?

Accepted Answer

A)  Living beyond one's means 
B)  High bills or personal debt 
C)  Personal financial losses 
D)  Desire to hurt employer financially 
A)  Living beyond one's means 
B)  High bills or personal debt 
C)  Personal financial losses 
D)  Desire to hurt employer financially

Question 4

A smart fraudster usually manipulates which financial record in order to better avoid an audit trail?

Accepted Answer

A)  Income statement 
B)  Balance sheet 
C)  Statement of cash flows 
D)  Statement of retained earnings 
A)  Income statement 
B)  Balance sheet 
C)  Statement of cash flows 
D)  Statement of retained earnings

Question 5

Which of the following is NOT a work-related pressure?

Accepted Answer

A)  Fear of losing one's job 
B)  Wanting to appear successful 
C)  Getting overlooked for a promotion 
D)  Insufficient/little recognition for work performance 
A)  Fear of losing one's job 
B)  Wanting to appear successful 
C)  Getting overlooked for a promotion 
D)  Insufficient/little recognition for work performance

Question 6

The theory behind is that if people know their work or activities will be monitored by others, the opportunity to commit and conceal a fraud will be reduced.

Accepted Answer

A)  documentation 
B)  segregation of duties 
C)  system of authorizations 
D)  independent checks 
A)  documentation 
B)  segregation of duties 
C)  system of authorizations 
D)  independent checks

Question 7

Greed, living beyond one's means, and high bills all describe what type of fraud-related pressure?

Accepted Answer

A)  Financial 
B)  Peer 
C)  Environmental 
D)  Work-related 
A)  Financial 
B)  Peer 
C)  Environmental 
D)  Work-related

Question 8

Which of the following is a true statement regarding the fraud scale depicted in the text?

Accepted Answer

A)  The greater the perceived opportunity to commit fraud, the less rationalization it takes to commit fraud. 
B)  The more dishonest a person is, the higher the need to rationalize the fraud act. 
C)  When the financial pressure increases, even low perceived opportunity is sufficient to commit fraud. 
D)  As the "need" to gamble increases, rationalization to commit fraud becomes easier. 
A)  The greater the perceived opportunity to commit fraud, the less rationalization it takes to commit fraud. 
B)  The more dishonest a person is, the higher the need to rationalize the fraud act. 
C)  When the financial pressure increases, even low perceived opportunity is sufficient to commit fraud. 
D)  As the "need" to gamble increases, rationalization to commit fraud becomes easier.

Question 9

An effective accounting system is designed to provide which of the following to help discover fraud?

Accepted Answer

A)  An audit trail 
B)  Matching of expenses to revenues 
C)  Set of controls 
D)  Set of accounting procedures 
A)  An audit trail 
B)  Matching of expenses to revenues 
C)  Set of controls 
D)  Set of accounting procedures

Question 10

Studies of honesty levels in advanced countries have led to which of the following expectations regarding fraud?

Accepted Answer

A)  Rationalizations will become more sophisticated. 
B)  Pressures to commit fraud will increase. 
C)  Less perceived opportunity will have to be present for fraud to occur. 
D)  Honesty tests in the workplace will increase. 
A)  Rationalizations will become more sophisticated. 
B)  Pressures to commit fraud will increase. 
C)  Less perceived opportunity will have to be present for fraud to occur. 
D)  Honesty tests in the workplace will increase.

Question 11

Which of the following is NOT one of the key elements common to all frauds?

Accepted Answer

A)  Perceived pressure 
B)  Perceived inequality 
C)  Perceived opportunity 
D)  Rationalization 
A)  Perceived pressure 
B)  Perceived inequality 
C)  Perceived opportunity 
D)  Rationalization

Question 12

Which of the following about rationalization is NOT true?

Accepted Answer

A)  Rationalization is a form of self-justification. 
B)  Rationalization is a way to lie to one's self. 
C)  People who rationalize feel they are basically honest people. 
D)  Rationalizing is unnecessary when there are multiple opportunities present to commit fraud. 
A)  Rationalization is a form of self-justification. 
B)  Rationalization is a way to lie to one's self. 
C)  People who rationalize feel they are basically honest people. 
D)  Rationalizing is unnecessary when there are multiple opportunities present to commit fraud.

Question 13

An employee who has the responsibilities of both writing checks and making bank deposits would have to commit fraud.

Accepted Answer

A)  financial pressure 
B)  a perceived opportunity 
C)  the rationalization 
D)  validation 
A)  financial pressure 
B)  a perceived opportunity 
C)  the rationalization 
D)  validation

Question 14

Which of the following factors creates an opportunity for fraud?

Accepted Answer

A)  Greed 
B)  Living beyond one's means 
C)  Lack of an audit trail 
D)  The organization owes it to me 
A)  Greed 
B)  Living beyond one's means 
C)  Lack of an audit trail 
D)  The organization owes it to me

Question 15

Which of the following observations is true?

Accepted Answer

A)  Research shows that only people with a criminal mindset commit fraud. 
B)  Fraud perpetrators usually can be distinguished from others based on psychological characteristics. 
C)  Most fraud perpetrators have profiles that are similar to those of other people. 
D)  When fraud does occur, the most common initial reaction by those involved in the fraud is confession. 
A)  Research shows that only people with a criminal mindset commit fraud. 
B)  Fraud perpetrators usually can be distinguished from others based on psychological characteristics. 
C)  Most fraud perpetrators have profiles that are similar to those of other people. 
D)  When fraud does occur, the most common initial reaction by those involved in the fraud is confession.

Question 16

Wilma participates in a fraud scheme by executing some derivative trades because she believed that a senior analyst knew more about complex derivative transactions than she did. These transactions were fraudulent in nature. Which type of power was employed to deceive Wilma?

Accepted Answer

A)  Expert power 
B)  Referent power 
C)  Coercive power 
D)  Reward power 
A)  Expert power 
B)  Referent power 
C)  Coercive power 
D)  Reward power

Question 17

Which of the following is NOT an element of a good control environment?

Accepted Answer

A)  Trust 
B)  Modeling 
C)  Appropriate hiring 
D)  Management's communication 
A)  Trust 
B)  Modeling 
C)  Appropriate hiring 
D)  Management's communication

Question 18

According to the study mentioned in the text, which of the following is true about fraud perpetrators compared to property offenders?

Accepted Answer

A)  Fraud perpetrators are more likely to be caught than property offenders. 
B)  Fraud perpetrators are more educated than property offenders. 
C)  Fraud perpetrators are more likely to be men than property offenders. 
D)  Fraud perpetrators are much younger than property offenders. 
A)  Fraud perpetrators are more likely to be caught than property offenders. 
B)  Fraud perpetrators are more educated than property offenders. 
C)  Fraud perpetrators are more likely to be men than property offenders. 
D)  Fraud perpetrators are much younger than property offenders.

Question 19

Which of the following is NOT a common rationalization of fraud perpetrators?

Accepted Answer

A)  The organization owes me. 
B)  I'm only borrowing the money. 
C)  No one will get hurt. 
D)  No one will care. 
A)  The organization owes me. 
B)  I'm only borrowing the money. 
C)  No one will get hurt. 
D)  No one will care.

Question 20

require(s) every public company to have a code of ethics to help deter wrongdoing.

Accepted Answer

A)  The Glass Steagall legislation 
B)  The Sarbanes-Oxley legislation 
C)  The Securities Act 
D)  Generally Accepted Auditing Standards 
A)  The Glass Steagall legislation 
B)  The Sarbanes-Oxley legislation 
C)  The Securities Act 
D)  Generally Accepted Auditing Standards

According to the Sarbanes-Oxley legislation, current changes to, or waivers of codes of ethics should be disclosed on:

What is the most important element in a control environment?

Which of the following is NOT a common financial pressure associated with fraud?

A smart fraudster usually manipulates which financial record in order to better avoid an audit trail?

Which of the following is NOT a work-related pressure?

The theory behind is that if people know their work or activities will be monitored by others, the opportunity to commit and conceal a fraud will be reduced.

Greed, living beyond one's means, and high bills all describe what type of fraud-related pressure?

Which of the following is a true statement regarding the fraud scale depicted in the text?

An effective accounting system is designed to provide which of the following to help discover fraud?

Studies of honesty levels in advanced countries have led to which of the following expectations regarding fraud?

Which of the following is NOT one of the key elements common to all frauds?

Which of the following about rationalization is NOT true?

An employee who has the responsibilities of both writing checks and making bank deposits would have to commit fraud.

Which of the following factors creates an opportunity for fraud?

Which of the following observations is true?

Wilma participates in a fraud scheme by executing some derivative trades because she believed that a senior analyst knew more about complex derivative transactions than she did. These transactions were fraudulent in nature. Which type of power was employed to deceive Wilma?

Which of the following is NOT an element of a good control environment?

According to the study mentioned in the text, which of the following is true about fraud perpetrators compared to property offenders?

Which of the following is NOT a common rationalization of fraud perpetrators?

require(s) every public company to have a code of ethics to help deter wrongdoing.

The Nature of Fraud

Fighting Fraud: an Overview

Preventing Fraud

Recognizing the Symptoms of Fraud

Data-Driven Fraud Detection

Investigating Theft Acts

Investigating Concealment

Conversion Investigation Methods

Inquiry Methods and Fraud Reports

Financial Statement Fraud

Revenue- and Inventory-Related Financial Statement Frauds

Liability, Asset, and Inadequate Disclosure Frauds

Fraud Against Organizations

Consumer Fraud

Bankruptcy, Divorce, and Tax Fraud

E-Commerce Fraud

Legal Follow-Up

Filters

Exam 2: Who Commits Fraud and Why

According to the Sarbanes-Oxley legislation, current changes to, or waivers of codes of ethics should be disclosed on:

What is the most important element in a control environment?

Which of the following is NOT a common financial pressure associated with fraud?

A smart fraudster usually manipulates which financial record in order to better avoid an audit trail?

Which of the following is NOT a work-related pressure?

The theory behind is that if people know their work or activities will be monitored by others, the opportunity to commit and conceal a fraud will be reduced.

Greed, living beyond one's means, and high bills all describe what type of fraud-related pressure?

Which of the following is a true statement regarding the fraud scale depicted in the text?

An effective accounting system is designed to provide which of the following to help discover fraud?

Studies of honesty levels in advanced countries have led to which of the following expectations regarding fraud?

Which of the following is NOT one of the key elements common to all frauds?

Which of the following about rationalization is NOT true?

An employee who has the responsibilities of both writing checks and making bank deposits would have to commit fraud.

Which of the following factors creates an opportunity for fraud?

Which of the following observations is true?

Wilma participates in a fraud scheme by executing some derivative trades because she believed that a senior analyst knew more about complex derivative transactions than she did. These transactions were fraudulent in nature. Which type of power was employed to deceive Wilma?

Which of the following is NOT an element of a good control environment?

According to the study mentioned in the text, which of the following is true about fraud perpetrators compared to property offenders?

Which of the following is NOT a common rationalization of fraud perpetrators?

require(s) every public company to have a code of ethics to help deter wrongdoing.

The Nature of Fraud

Fighting Fraud: an Overview

Preventing Fraud

Recognizing the Symptoms of Fraud

Data-Driven Fraud Detection

Investigating Theft Acts

Investigating Concealment

Conversion Investigation Methods

Inquiry Methods and Fraud Reports

Financial Statement Fraud

Revenue- and Inventory-Related Financial Statement Frauds

Liability, Asset, and Inadequate Disclosure Frauds

Fraud Against Organizations

Consumer Fraud

Bankruptcy, Divorce, and Tax Fraud

E-Commerce Fraud

Legal Follow-Up

Filters