Question 1

Which of the following is a sign of a positive work environment?

Accepted Answer

A) Rigid rules followed by the organization 
B) Managers who care about the employee work ethic 
C) Careful hiring policies 
D) Having positive personnel and operating procedures 
A) Rigid rules followed by the organization 
B) Managers who care about the employee work ethic 
C) Careful hiring policies 
D) Having positive personnel and operating procedures

Question 2

Which of the following questions should be avoided during a job interview?

Accepted Answer

A) Can you tell me your birth date? 
B) If the opportunities in your previous assignment were good, why did you leave it? 
C) Can you relate an instance in which you resolved a conflict with a co-worker? 
D) What motivates you at work? 
A) Can you tell me your birth date? 
B) If the opportunities in your previous assignment were good, why did you leave it? 
C) Can you relate an instance in which you resolved a conflict with a co-worker? 
D) What motivates you at work?

Question 3

Which of the following should employers always obtain from the applicant to obtain information from references?

Accepted Answer

A) A verbal authorization 
B) A hold harmless agreement 
C) A privacy statement 
D) A no-objection certificate 
A) A verbal authorization 
B) A hold harmless agreement 
C) A privacy statement 
D) A no-objection certificate

Question 4

Which of the following describes the overall tone of the organization that management establishes through its modeling and labeling,organization,communication,and other activities?

Accepted Answer

A) detection framework 
B) risk mitigation channel 
C) support network 
D) control environment 
A) detection framework 
B) risk mitigation channel 
C) support network 
D) control environment

Question 5

Which of the following would usually be an environment conducive to fraud?

Accepted Answer

A) Low turnover 
B) Reactive rather than proactive management 
C) Supportive rather than rivalrous relationships 
D) Long-term business focus 
A) Low turnover 
B) Reactive rather than proactive management 
C) Supportive rather than rivalrous relationships 
D) Long-term business focus

Question 6

What are the key attributes for a low-fraud environment?

Accepted Answer

A) Rules, control, and consequences. 
B) Recognition, prosecution, and restitution. 
C) Honesty, openness, and assistance. 
D) Rules, consequences, and rewards. 
A) Rules, control, and consequences. 
B) Recognition, prosecution, and restitution. 
C) Honesty, openness, and assistance. 
D) Rules, consequences, and rewards.

Question 7

Developing and promoting a well-defined corporate code of conduct is related to which element of the fraud-fighting model?

Accepted Answer

A) Investigation & follow-up 
B) Education & training 
C) Tone at the top 
D) Proactive fraud detection 
A) Investigation & follow-up 
B) Education & training 
C) Tone at the top 
D) Proactive fraud detection

Question 8

A good internal control system includes:

Accepted Answer

A) open work environments. 
B) rigid rules. 
C) segregation of duties. 
D) following strict hiring procedures. 
A) open work environments. 
B) rigid rules. 
C) segregation of duties. 
D) following strict hiring procedures.

Question 9

An employee recently bought three new cars and remodeled his/her home.These facts would be considered as a:

Accepted Answer

A) lifestyle symptom. 
B) spending addiction symptom. 
C) extravagant behavior symptom. 
D) financial symptom. 
A) lifestyle symptom. 
B) spending addiction symptom. 
C) extravagant behavior symptom. 
D) financial symptom.

Question 10

Approximately ____ of all frauds are committed by individual acting alone.The remaining ____ involves collusion and often involve the ____ thefts.

Accepted Answer

A) 63%, 37%, smallest 
B) 71%, 29%, largest 
C) 47%, 53%, smallest 
D) 18%, 82%, largest 
A) 63%, 37%, smallest 
B) 71%, 29%, largest 
C) 47%, 53%, smallest 
D) 18%, 82%, largest

Question 11

In order to detect fraud at the earliest,a manager should pay attention to:

Accepted Answer

A) present lifestyle. 
B) past conduct. 
C) attitude toward work. 
D) absenteeism. 
A) present lifestyle. 
B) past conduct. 
C) attitude toward work. 
D) absenteeism.

Question 12

Control activities can be grouped as preventive controls and detective controls.Which of the following is a detective control?

Accepted Answer

A) System of authorizations 
B) Segregation of duties 
C) Independent checks 
D) Physical safeguards 
A) System of authorizations 
B) Segregation of duties 
C) Independent checks 
D) Physical safeguards

Question 13

A "right-to-audit" clause:

Accepted Answer

A) provide rights to the vendor to audit the company's books at any time. 
B) gives an external auditor the right to audit the company's books. 
C) is considered in civil court as an invasion of privacy. 
D) alerts vendors that the company reserves the right to audit the vendor's books at any time. 
A) provide rights to the vendor to audit the company's books at any time. 
B) gives an external auditor the right to audit the company's books. 
C) is considered in civil court as an invasion of privacy. 
D) alerts vendors that the company reserves the right to audit the vendor's books at any time.

Question 14

What is the most likely outcome when a company demotes the perpetrator but allows him or her to go unprosecuted?

Accepted Answer

A) The company will avoid bad publicity. 
B) The perpetrator may commit another fraud in the future. 
C) The perpetrator will be saved from pain and embarrassment. 
D) Management will send a signal that fraud will not be tolerated. 
A) The company will avoid bad publicity. 
B) The perpetrator may commit another fraud in the future. 
C) The perpetrator will be saved from pain and embarrassment. 
D) Management will send a signal that fraud will not be tolerated.

Question 15

Which of the following is a step that organizations should undertake while recruiting employees?

Accepted Answer

A) Conduct a covert investigation on the background of each candidate. 
B) Consider the candidate's word as truth to ensure a culture of trust and honesty. 
C) Require candidates to certify that all information on their résumé is accurate. 
D) Verify the candidate's race, age, and religion during the interview. 
A) Conduct a covert investigation on the background of each candidate. 
B) Consider the candidate's word as truth to ensure a culture of trust and honesty. 
C) Require candidates to certify that all information on their résumé is accurate. 
D) Verify the candidate's race, age, and religion during the interview.

Question 16

Who has the primary responsibility for establishing and maintaining good internal controls?

Accepted Answer

A) Primary responsibility for controls belongs to internal auditors.They are the ones who create the controls and investigate potential violations of the controls. 
B) Primary responsibility rests with management.Management both conveys acceptable culture and has the final say in how fraud cases are treated. 
C) Primary responsibility lies with employees.They are the ones most likely to fully understand the system on a day-to-day basis and know where controls should be put in place. 
D) Primary responsibility is not attributable to one person or group of people within an organization.Each member of an organization must consider himself or herself personally responsible for the organization's control environment. 
A) Primary responsibility for controls belongs to internal auditors.They are the ones who create the controls and investigate potential violations of the controls. 
B) Primary responsibility rests with management.Management both conveys acceptable culture and has the final say in how fraud cases are treated. 
C) Primary responsibility lies with employees.They are the ones most likely to fully understand the system on a day-to-day basis and know where controls should be put in place. 
D) Primary responsibility is not attributable to one person or group of people within an organization.Each member of an organization must consider himself or herself personally responsible for the organization's control environment.

Question 17

Company X has a good whistle-blowing program in place.Sara used the whistle-blowing system to alert the management about a fraud being committed by a senior employee in the human resource department.The company investigated the allegation and punished the fraudster.However,Sara was shocked to find later that everyone in her team knew that she was the one who blew the whistle.What could be a major issue with the program at the company?

Accepted Answer

A) Unclear policies regarding whistle blowing 
B) Lack of awareness about the program 
C) Management inaction regarding anonymity policies 
D) Lack of adherence to anonymity policies 
A) Unclear policies regarding whistle blowing 
B) Lack of awareness about the program 
C) Management inaction regarding anonymity policies 
D) Lack of adherence to anonymity policies

Question 18

​Which of the following is the role of an internal auditor in an organization?

Accepted Answer

A) ​to establish the controls for the organization 
B) ​to write the code of ethical business conduct for the organization 
C) ​to test the system of internal controls in order to attest that there are no material weaknesses 
D) ​to assist management with the evaluation of internal controls currently in place 
A) ​to establish the controls for the organization 
B) ​to write the code of ethical business conduct for the organization 
C) ​to test the system of internal controls in order to attest that there are no material weaknesses 
D) ​to assist management with the evaluation of internal controls currently in place

Question 19

​Which of the following best describes an action that can cause a whistle-blowing system in place in the organization to fail?

Accepted Answer

A) ​The organization requires employees to report all suspicious activity. 
B) ​The employee suspecting fraud reports directly to his/her supervisor's manager. 
C) ​Management is slow to act on reports of suspected fraud. 
D) ​An extensive code of ethics is in place and on file in order to answer employee inquiries. 
A) ​The organization requires employees to report all suspicious activity. 
B) ​The employee suspecting fraud reports directly to his/her supervisor's manager. 
C) ​Management is slow to act on reports of suspected fraud. 
D) ​An extensive code of ethics is in place and on file in order to answer employee inquiries.

Question 20

One way to create and communicate clear expectations about what is and is not acceptable in an organization is:

Accepted Answer

A) having separate, nonintegrated personnel and operating policies. 
B) creating an expectation of punishment. 
C) following a reactive management style. 
D) to have a clearly defined code of conduct in place. 
A) having separate, nonintegrated personnel and operating policies. 
B) creating an expectation of punishment. 
C) following a reactive management style. 
D) to have a clearly defined code of conduct in place.

Which of the following is a sign of a positive work environment?

Which of the following questions should be avoided during a job interview?

Which of the following should employers always obtain from the applicant to obtain information from references?

Which of the following describes the overall tone of the organization that management establishes through its modeling and labeling,organization,communication,and other activities?

Which of the following would usually be an environment conducive to fraud?

What are the key attributes for a low-fraud environment?

Developing and promoting a well-defined corporate code of conduct is related to which element of the fraud-fighting model?

A good internal control system includes:

An employee recently bought three new cars and remodeled his/her home.These facts would be considered as a:

Approximately of all frauds are committed by individual acting alone.The remaining involves collusion and often involve the thefts.

In order to detect fraud at the earliest,a manager should pay attention to:

Control activities can be grouped as preventive controls and detective controls.Which of the following is a detective control?

A "right-to-audit" clause:

What is the most likely outcome when a company demotes the perpetrator but allows him or her to go unprosecuted?

Which of the following is a step that organizations should undertake while recruiting employees?

Who has the primary responsibility for establishing and maintaining good internal controls?

Which of the following is the role of an internal auditor in an organization?

Which of the following best describes an action that can cause a whistle-blowing system in place in the organization to fail?

One way to create and communicate clear expectations about what is and is not acceptable in an organization is:

The Nature of Fraud

Who Commits Fraud and Why

Fighting Fraud: an Overview

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 4: Preventing Fraud

Which of the following is a sign of a positive work environment?

Which of the following questions should be avoided during a job interview?

Which of the following should employers always obtain from the applicant to obtain information from references?

Which of the following describes the overall tone of the organization that management establishes through its modeling and labeling,organization,communication,and other activities?

Which of the following would usually be an environment conducive to fraud?

What are the key attributes for a low-fraud environment?

Developing and promoting a well-defined corporate code of conduct is related to which element of the fraud-fighting model?

A good internal control system includes:

An employee recently bought three new cars and remodeled his/her home.These facts would be considered as a:

Approximately ____ of all frauds are committed by individual acting alone.The remaining ____ involves collusion and often involve the ____ thefts.

In order to detect fraud at the earliest,a manager should pay attention to:

Control activities can be grouped as preventive controls and detective controls.Which of the following is a detective control?

A "right-to-audit" clause:

What is the most likely outcome when a company demotes the perpetrator but allows him or her to go unprosecuted?

Which of the following is a step that organizations should undertake while recruiting employees?

Who has the primary responsibility for establishing and maintaining good internal controls?

​Which of the following is the role of an internal auditor in an organization?

​Which of the following best describes an action that can cause a whistle-blowing system in place in the organization to fail?

One way to create and communicate clear expectations about what is and is not acceptable in an organization is:

The Nature of Fraud

Who Commits Fraud and Why

Fighting Fraud: an Overview

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

Approximately of all frauds are committed by individual acting alone.The remaining involves collusion and often involve the thefts.

Which of the following is the role of an internal auditor in an organization?

Which of the following best describes an action that can cause a whistle-blowing system in place in the organization to fail?