Question 1

What is the meaning of "short sell"?

Accepted Answer

A) Buy shares from a brokerage firm and enter into a forward transaction to sell the shares at today's price on a future date. 
B) Sell the shares at today's price to an investor and enter into an option agreement to buy the shares back in near future. 
C) Buy shares from one brokerage firm and sell the shares to another brokerage firm with a view to make quick money. 
D) Borrow shares from a brokerage and sell the shares at today's price with the intention to repay the borrowed stock they sold at some future time when the stock is trading for a lower price. 
A) Buy shares from a brokerage firm and enter into a forward transaction to sell the shares at today's price on a future date. 
B) Sell the shares at today's price to an investor and enter into an option agreement to buy the shares back in near future. 
C) Buy shares from one brokerage firm and sell the shares to another brokerage firm with a view to make quick money. 
D) Borrow shares from a brokerage and sell the shares at today's price with the intention to repay the borrowed stock they sold at some future time when the stock is trading for a lower price.

Question 2

Which of the following is NOT a kind of questions that should be asked in order to understand the exposure to management fraud?

Accepted Answer

A) Is a legitimate business purpose apparent for each separate entity of the business? 
B) Have significant recent changes occurred in the nature of the organization? 
C) Are the accounting and information technology staff and organization effective? 
D) How many employees are there in the organization who have many years with the organization? 
A) Is a legitimate business purpose apparent for each separate entity of the business? 
B) Have significant recent changes occurred in the nature of the organization? 
C) Are the accounting and information technology staff and organization effective? 
D) How many employees are there in the organization who have many years with the organization?

Question 3

Which of the terms refers to the ability to anticipate a fraud perpetrator's likely method of concealing a fraud?

Accepted Answer

A) Zero-order reasoning 
B) Deductive reasoning 
C) Strategic reasoning 
D) Low-order reasoning 
A) Zero-order reasoning 
B) Deductive reasoning 
C) Strategic reasoning 
D) Low-order reasoning

Question 4

Identify an example of a perceived pressure that can motivate financial statement fraud.

Accepted Answer

A) The ability to obfuscate the fraud behind complex transactions 
B) Failure to meet Wall Street's earnings expectations 
C) Rationalizing that all companies use aggressive accounting practices 
D) A weak board of directors 
A) The ability to obfuscate the fraud behind complex transactions 
B) Failure to meet Wall Street's earnings expectations 
C) Rationalizing that all companies use aggressive accounting practices 
D) A weak board of directors

Question 5

There has been an auditor change at Company X.Which of the following situations may NOT signal a potential fraud problem?

Accepted Answer

A) Failure to pay an audit fee 
B) Auditee believing that the auditor's fees are too high 
C) Suspected fraud or other problems by the auditor 
D) Auditor-auditee disagreement 
A) Failure to pay an audit fee 
B) Auditee believing that the auditor's fees are too high 
C) Suspected fraud or other problems by the auditor 
D) Auditor-auditee disagreement

Question 6

Which of the following is a finding of the Treadway Commission?

Accepted Answer

A) Financial statement frauds occur very often, the average fraud lasts about two years. 
B) The CEO perpetrates the fraud in 72% of the cases. 
C) While financial statement frauds occur infrequently, they are extremely costly. 
D) Financial statement fraud occurs mostly in companies that are listed. 
A) Financial statement frauds occur very often, the average fraud lasts about two years. 
B) The CEO perpetrates the fraud in 72% of the cases. 
C) While financial statement frauds occur infrequently, they are extremely costly. 
D) Financial statement fraud occurs mostly in companies that are listed.

Question 7

Many financial statement frauds have been perpetrated because:

Accepted Answer

A) management needed to report high income to support stock prices. 
B) management wanted to decrease the total tax payable by the company. 
C) management wanted to show artificial losses to employees. 
D) management wanted to pay lower dividends to the shareholders. 
A) management needed to report high income to support stock prices. 
B) management wanted to decrease the total tax payable by the company. 
C) management wanted to show artificial losses to employees. 
D) management wanted to pay lower dividends to the shareholders.

What is the meaning of "short sell"?

Which of the following is NOT a kind of questions that should be asked in order to understand the exposure to management fraud?

Which of the terms refers to the ability to anticipate a fraud perpetrator's likely method of concealing a fraud?

Identify an example of a perceived pressure that can motivate financial statement fraud.

There has been an auditor change at Company X.Which of the following situations may NOT signal a potential fraud problem?

Which of the following is a finding of the Treadway Commission?

Many financial statement frauds have been perpetrated because:

The Nature of Fraud

Who Commits Fraud and Why

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

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 11: Financial Statement Fraud

What is the meaning of "short sell"?

Which of the following is NOT a kind of questions that should be asked in order to understand the exposure to management fraud?

Which of the terms refers to the ability to anticipate a fraud perpetrator's likely method of concealing a fraud?

Identify an example of a perceived pressure that can motivate financial statement fraud.

There has been an auditor change at Company X.Which of the following situations may NOT signal a potential fraud problem?

Which of the following is a finding of the Treadway Commission?

Many financial statement frauds have been perpetrated because:

The Nature of Fraud

Who Commits Fraud and Why

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

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