Question 1

The term _____________________________ refers to the application of accounting and auditing skills to civil and criminal problems.

Accepted Answer

The answer of The term _____________________________ refers to the application...

Question 2

If an employee altered the amount of a check after it has cleared the bank,the change can be detected by

Accepted Answer

A)  Comparing the amount written on the check face to the amount written in the cash disbursements journal. 
B)  Comparing the magnetic imprint of the amount paid to the amount written on the check face. 
C)  Examining the endorsement on the back of the check. 
D)  Comparing the check number on the face of the check to the check number in the cash disbursements journal. 
A)  Comparing the amount written on the check face to the amount written in the cash disbursements journal. 
B)  Comparing the magnetic imprint of the amount paid to the amount written on the check face. 
C)  Examining the endorsement on the back of the check. 
D)  Comparing the check number on the face of the check to the check number in the cash disbursements journal.

Question 3

The chain of custody is the crucial link of evidence to the fraud suspect.

Accepted Answer

A) True 
 B)False

Question 4

Which of these arrangements of duties could most likely lead to an embezzlement or theft?

Accepted Answer

A)  The inventory warehouse manager has responsibility for making the physical inventory observation and reconciling discrepancies to the perpetual inventory records. 
B)  The cashier prepared the bank deposit, endorsed the checks with a company stamp, and delivered the cash and checks to the bank for deposit (no other bookkeeping duties). 
C)  The accounts receivable clerk received a list of payments received by the cashier so he could make entries in the customers' accounts receivable subsidiary accounts. 
D)  The financial vice president received checks made out to suppliers and the supporting invoices, signed the checks, and mailed the checks. 
A)  The inventory warehouse manager has responsibility for making the physical inventory observation and reconciling discrepancies to the perpetual inventory records. 
B)  The cashier prepared the bank deposit, endorsed the checks with a company stamp, and delivered the cash and checks to the bank for deposit (no other bookkeeping duties). 
C)  The accounts receivable clerk received a list of payments received by the cashier so he could make entries in the customers' accounts receivable subsidiary accounts. 
D)  The financial vice president received checks made out to suppliers and the supporting invoices, signed the checks, and mailed the checks.

Question 5

For each of the descriptions in Column A,match the correct word or words from Column B.

Accepted Answer

1.E; 2.L;

Question 6

Allison Everhart,an employee in accounts payable,believes she can run a fictitious invoice through the accounts payable system and collect the money.She knows payments are subject to an audit.Which account would be the best place to hide the fraud?

Accepted Answer

A)  Inventory. 
B)  Wage expense. 
C)  Consulting service expense. 
D)  Property tax expense. 
A)  Inventory. 
B)  Wage expense. 
C)  Consulting service expense. 
D)  Property tax expense.

Question 7

A set of telltale signs of erroneous accounting,missing or altered documents,or a "dangling debt" is referred to as a _____________________________.

Accepted Answer

The answer of A set of telltale signs of erroneous...

Question 8

Narbona,CPA,is reviewing controls over cash received through a bank night depository.Which controls would she find most important?

Accepted Answer

A)  Responsibilities are rotated for processing night depository receipts among employees of the various departments. 
B)  Dual control (joint custody) is established over the contents of the night depository box from the time of removal until initial recording is completed. 
C)  Vacations are required for all employees engaged in night depository activities. 
D)  All deposit tickets related to night deposits are numbered. 
A)  Responsibilities are rotated for processing night depository receipts among employees of the various departments. 
B)  Dual control (joint custody) is established over the contents of the night depository box from the time of removal until initial recording is completed. 
C)  Vacations are required for all employees engaged in night depository activities. 
D)  All deposit tickets related to night deposits are numbered.

Question 9

When counting cash on hand the auditor must exercise simultaneous control over all cash and other negotiable assets to prevent

Accepted Answer

A)  Theft. 
B)  Irregular endorsement. 
C)  Replacement or substitution of stolen assets. 
D)  Deposits in transit. 
A)  Theft. 
B)  Irregular endorsement. 
C)  Replacement or substitution of stolen assets. 
D)  Deposits in transit.

Question 10

Which of the following would be consistent with an employee taking cash receipts from customers on account?

Accepted Answer

A)  The total of the accounts receivable subsidiary ledger balances is less than the accounts receivable control account. 
B)  The total of the accounts receivable subsidiary ledger balances is more than the accounts receivable control account. 
C)  Total cash receipts from customers for the month are less than credit sales for the month. 
D)  Total cash receipts from customers for the month are more than credit sales for the month. 
A)  The total of the accounts receivable subsidiary ledger balances is less than the accounts receivable control account. 
B)  The total of the accounts receivable subsidiary ledger balances is more than the accounts receivable control account. 
C)  Total cash receipts from customers for the month are less than credit sales for the month. 
D)  Total cash receipts from customers for the month are more than credit sales for the month.

Question 11

The client should request the bank to send a cutoff bank statement directly to the auditor.

Accepted Answer

A) True 
 B)False

Question 12

Another name for employee fraud and embezzlement is _________________________.

Accepted Answer

The answer of Another name for employee fraud and embezzlement...

Question 13

During an audit of cash,the auditor is most concerned with the management assertion of

Accepted Answer

A)  Existence. 
B)  Rights and obligations. 
C)  Valuation or allocation. 
D)  Occurrence. 
A)  Existence. 
B)  Rights and obligations. 
C)  Valuation or allocation. 
D)  Occurrence.

Question 14

In the audit of cash,the auditor obtains a bank cutoff statement primarily to

Accepted Answer

A)  Identify old outstanding checks that the client may exclude from the year-end bank reconciliation in order to misappropriate cash. 
B)  Obtain sufficient information to reconcile the client's bank account as of year-end. 
C)  Obtain direct confirmation of the client's bank balances as of year-end. 
D)  Test the propriety of items appearing on the client's year-end bank reconciliation. 
A)  Identify old outstanding checks that the client may exclude from the year-end bank reconciliation in order to misappropriate cash. 
B)  Obtain sufficient information to reconcile the client's bank account as of year-end. 
C)  Obtain direct confirmation of the client's bank balances as of year-end. 
D)  Test the propriety of items appearing on the client's year-end bank reconciliation.

Question 15

An internal control questionnaire for evaluating the completeness objective of cash receipts would not include which of the following questions?

Accepted Answer

A)  Does the person who opens the mail make a list of cash received? 
B)  Are prenumbered sales invoices or receipt books used? 
C)  Are current receipts controlled by mechanical devices? 
D)  Does a responsible person approve discounts taken by customers with payments on account? 
A)  Does the person who opens the mail make a list of cash received? 
B)  Are prenumbered sales invoices or receipt books used? 
C)  Are current receipts controlled by mechanical devices? 
D)  Does a responsible person approve discounts taken by customers with payments on account?

Question 16

Employee fraud generally involves people at the top executive level.

Accepted Answer

A) True 
 B)False

Question 17

Which of the following should be performed by the persons opening the mail and recording payments?

Accepted Answer

A)  Adding a restrictive endorsement on all checks. 
B)  Entering payment information into customer accounts. 
C)  Preparing the deposit slip and the delivery of the checks to the bank. 
D)  Segregating all payments made on accounts listed as past due. 
A)  Adding a restrictive endorsement on all checks. 
B)  Entering payment information into customer accounts. 
C)  Preparing the deposit slip and the delivery of the checks to the bank. 
D)  Segregating all payments made on accounts listed as past due.

Question 18

Fidelity bonds are used to prevent embezzlement.

Accepted Answer

A) True 
 B)False

Question 19

It is always good control to have the bookkeeper prepare a list of cash receipts and then have the bookkeeper record it immediately in the accounts.

Accepted Answer

A) True 
 B)False

Question 20

To provide assurance that each voucher is submitted and paid only once,an auditor most likely would examine a sample of paid vouchers and determine whether each voucher is

Accepted Answer

A)  Supported by a vendor's invoice. 
B)  Stamped PAID by the check signer. 
C)  Prenumbered and accounted for. 
D)  Approved for authorized purchases. 
A)  Supported by a vendor's invoice. 
B)  Stamped PAID by the check signer. 
C)  Prenumbered and accounted for. 
D)  Approved for authorized purchases.

The term _____________________________ refers to the application of accounting and auditing skills to civil and criminal problems.

If an employee altered the amount of a check after it has cleared the bank,the change can be detected by

The chain of custody is the crucial link of evidence to the fraud suspect.

Which of these arrangements of duties could most likely lead to an embezzlement or theft?

For each of the descriptions in Column A,match the correct word or words from Column B.

Allison Everhart,an employee in accounts payable,believes she can run a fictitious invoice through the accounts payable system and collect the money.She knows payments are subject to an audit.Which account would be the best place to hide the fraud?

A set of telltale signs of erroneous accounting,missing or altered documents,or a "dangling debt" is referred to as a _____________________________.

Narbona,CPA,is reviewing controls over cash received through a bank night depository.Which controls would she find most important?

When counting cash on hand the auditor must exercise simultaneous control over all cash and other negotiable assets to prevent

Which of the following would be consistent with an employee taking cash receipts from customers on account?

The client should request the bank to send a cutoff bank statement directly to the auditor.

Another name for employee fraud and embezzlement is _________________________.

During an audit of cash,the auditor is most concerned with the management assertion of

In the audit of cash,the auditor obtains a bank cutoff statement primarily to

An internal control questionnaire for evaluating the completeness objective of cash receipts would not include which of the following questions?

Employee fraud generally involves people at the top executive level.

Which of the following should be performed by the persons opening the mail and recording payments?

Fidelity bonds are used to prevent embezzlement.

It is always good control to have the bookkeeper prepare a list of cash receipts and then have the bookkeeper record it immediately in the accounts.

To provide assurance that each voucher is submitted and paid only once,an auditor most likely would examine a sample of paid vouchers and determine whether each voucher is

Auditing and Assurance Services

Professional Standards

Engagement Planning

Management Fraud and Audit Risk

Risk Assessment: Internal Control Evaluation

Revenue and Collection Cycle

Acquisition and Expenditure Cycle

Production Cycle

Finance and Investment Cycle

Completing the Audit

Reports on Audited Financial Statements

Other Public Accounting Services

Professional Ethics

Legal Liability

Internal Governmental and Fraud Audits

Overview of Sampling

Attributes Sampling

Variables Sampling

Auditing in a Computerized Environment

Filters

Exam 6: Employee Fraud and the Audit of Cash

The term _____________________________ refers to the application of accounting and auditing skills to civil and criminal problems.

If an employee altered the amount of a check after it has cleared the bank,the change can be detected by

The chain of custody is the crucial link of evidence to the fraud suspect.

Which of these arrangements of duties could most likely lead to an embezzlement or theft?

For each of the descriptions in Column A,match the correct word or words from Column B.

Allison Everhart,an employee in accounts payable,believes she can run a fictitious invoice through the accounts payable system and collect the money.She knows payments are subject to an audit.Which account would be the best place to hide the fraud?

A set of telltale signs of erroneous accounting,missing or altered documents,or a "dangling debt" is referred to as a _____________________________.

Narbona,CPA,is reviewing controls over cash received through a bank night depository.Which controls would she find most important?

When counting cash on hand the auditor must exercise simultaneous control over all cash and other negotiable assets to prevent

Which of the following would be consistent with an employee taking cash receipts from customers on account?

The client should request the bank to send a cutoff bank statement directly to the auditor.

Another name for employee fraud and embezzlement is _________________________.

During an audit of cash,the auditor is most concerned with the management assertion of

In the audit of cash,the auditor obtains a bank cutoff statement primarily to

An internal control questionnaire for evaluating the completeness objective of cash receipts would not include which of the following questions?

Employee fraud generally involves people at the top executive level.

Which of the following should be performed by the persons opening the mail and recording payments?

Fidelity bonds are used to prevent embezzlement.

It is always good control to have the bookkeeper prepare a list of cash receipts and then have the bookkeeper record it immediately in the accounts.

To provide assurance that each voucher is submitted and paid only once,an auditor most likely would examine a sample of paid vouchers and determine whether each voucher is

Auditing and Assurance Services

Professional Standards

Engagement Planning

Management Fraud and Audit Risk

Risk Assessment: Internal Control Evaluation

Revenue and Collection Cycle

Acquisition and Expenditure Cycle

Production Cycle

Finance and Investment Cycle

Completing the Audit

Reports on Audited Financial Statements

Other Public Accounting Services

Professional Ethics

Legal Liability

Internal Governmental and Fraud Audits

Overview of Sampling

Attributes Sampling

Variables Sampling

Auditing in a Computerized Environment

Filters