Question 1

Which of the following is NOT one of the most common types of billing schemes?

Accepted Answer

A) Setting up dummy companies (shell companies) to submit invoices to the victim organization. 
B) Altering or double-paying a nonaccomplice vendor's statements 
C) Overbilling the company for travel and other related business expenses, such as business lunches, hotel bills, and air travel. 
D) Making personal purchases with company funds. 
A) Setting up dummy companies (shell companies) to submit invoices to the victim organization. 
B) Altering or double-paying a nonaccomplice vendor's statements 
C) Overbilling the company for travel and other related business expenses, such as business lunches, hotel bills, and air travel. 
D) Making personal purchases with company funds.

Question 2

A conflict of interest occurs when:

Accepted Answer

A) an employer knows of an employee's interest in a business deal or negotiation. 
B) an employee has an economic or personal interest in a transaction that adversely affects the company. 
C) employees offer, give, receive or solicit anything of value in order to influence an official act. 
D) employees demand payments from vendors for deciding in the vendors' favor. 
A) an employer knows of an employee's interest in a business deal or negotiation. 
B) an employee has an economic or personal interest in a transaction that adversely affects the company. 
C) employees offer, give, receive or solicit anything of value in order to influence an official act. 
D) employees demand payments from vendors for deciding in the vendors' favor.

Question 3

What is the point of difference between illegal gratuity and bribery scheme?

Accepted Answer

A) Compared to illegal gratuities, briberies occur relatively infrequently and are usually quite small. 
B) Illegal gratuities do not necessarily involve an intent to influence a business decision but rather to reward someone for making a favorable decision. 
C) Illegal gratuities usually involve the use of actual or threatened force, fear, or economic duress. 
D) Illegal gratuities are made before deals are approved. 
A) Compared to illegal gratuities, briberies occur relatively infrequently and are usually quite small. 
B) Illegal gratuities do not necessarily involve an intent to influence a business decision but rather to reward someone for making a favorable decision. 
C) Illegal gratuities usually involve the use of actual or threatened force, fear, or economic duress. 
D) Illegal gratuities are made before deals are approved.

Question 4

Employees,vendors,and customers of organizations have three opportunities to steal assets.Which of the following is NOT one among them?

Accepted Answer

A) Steal receipts of cash and other assets as they are coming into an organization. 
B) Steal cash, inventory, and other assets that are on hand. 
C) Commit disbursement fraud by having the organization pay for something it shouldn't pay for or pay too much for something it purchases. 
D) Paying off public officials or company insiders for preferential treatment. 
A) Steal receipts of cash and other assets as they are coming into an organization. 
B) Steal cash, inventory, and other assets that are on hand. 
C) Commit disbursement fraud by having the organization pay for something it shouldn't pay for or pay too much for something it purchases. 
D) Paying off public officials or company insiders for preferential treatment.

Question 5

Which function of the victim company is usually involved in Kickback schemes?

Accepted Answer

A) sales 
B) accounting 
C) human resources 
D) purchasing 
A) sales 
B) accounting 
C) human resources 
D) purchasing

Question 6

Thefts of inventory are divided into two groups.Identify them.

Accepted Answer

A) Corruption and bribery 
B) Expense scheme and skimming 
C) Economic extortion and illegal gratuities 
D) Larceny and misuse 
A) Corruption and bribery 
B) Expense scheme and skimming 
C) Economic extortion and illegal gratuities 
D) Larceny and misuse

Question 7

What is known as the net asset value (NAV)?

Accepted Answer

A) The closing price of the securities that comprise a particular fund's portfolio plus the value of any uninvested cash that the fund manager maintains for the fund. 
B) A concept used in finance and economics, defined as a rational and unbiased estimate of the potential market price of a good, service, or asset. 
C) The value of an entity's assets less the value of its current liabilities at the end of the trading day. 
D) The difference between the replacement cost of a fixed asset and its book value appearing on the balance sheet. 
A) The closing price of the securities that comprise a particular fund's portfolio plus the value of any uninvested cash that the fund manager maintains for the fund. 
B) A concept used in finance and economics, defined as a rational and unbiased estimate of the potential market price of a good, service, or asset. 
C) The value of an entity's assets less the value of its current liabilities at the end of the trading day. 
D) The difference between the replacement cost of a fixed asset and its book value appearing on the balance sheet.

Question 8

What is the term that describes allowing selected investors to purchase mutual funds after 4:00 p.m.,using that day's net asset value (NAV),rather than the next day's NAV,as required under the law?

Accepted Answer

A) Forward pricing 
B) Late trading 
C) Backdating 
D) Circular trading 
A) Forward pricing 
B) Late trading 
C) Backdating 
D) Circular trading

Question 9

Which of the following is the best example of theft of cash through skimming?

Accepted Answer

A) Preparing fraudulent checks. 
B) Understating sales by recording larger-than reality sales discounts. 
C) Setting up dummy companies. 
D) Stealing cash after it has already been recorded. 
A) Preparing fraudulent checks. 
B) Understating sales by recording larger-than reality sales discounts. 
C) Setting up dummy companies. 
D) Stealing cash after it has already been recorded.

Question 10

Which of the following is an example of a register-disbursement scheme?

Accepted Answer

A) A perpetrator who processes transactions as if a customer were returning merchandise, even though there is no actual return. 
B) A perpetrator uses the expense register to falsely record expenses that are then paid out by the A/P department. 
C) A perpetrator physically prepares a check from the check register claiming it is a legitimate expense when it is not. 
D) A perpetrator slowly takes money from the register drawer after making regular sales, showing that a discount was given to a customer on the receipt. 
A) A perpetrator who processes transactions as if a customer were returning merchandise, even though there is no actual return. 
B) A perpetrator uses the expense register to falsely record expenses that are then paid out by the A/P department. 
C) A perpetrator physically prepares a check from the check register claiming it is a legitimate expense when it is not. 
D) A perpetrator slowly takes money from the register drawer after making regular sales, showing that a discount was given to a customer on the receipt.

Question 11

An ice cream store cashier sells two-scoop ice cream cones to customers and enters the sales as single-scoop sales,while keeping the difference for himself.Which fraud is being committed here?

Accepted Answer

A) Larceny 
B) Disbursement 
C) Skimming 
D) Illegal gratuities 
A) Larceny 
B) Disbursement 
C) Skimming 
D) Illegal gratuities

Question 12

For ghost-employee fraud schemes to work,four things must happen.Which of the following is NOT one among them?

Accepted Answer

A) The ghost must be added to the payroll. 
B) Timekeeping and wage rate information must be collected. 
C) A paycheck must be issued to the ghost. 
D) A member of Human Resources must be involved in the fraud. 
A) The ghost must be added to the payroll. 
B) Timekeeping and wage rate information must be collected. 
C) A paycheck must be issued to the ghost. 
D) A member of Human Resources must be involved in the fraud.

Question 13

Orders placed for buying shares of a mutual fund any time up to 4:00 p.m.are priced at that day's net asset value (NAV),and orders placed after 4:01 p.m.are priced at the next day's NAV.What is this practice known as?

Accepted Answer

A) Forward pricing 
B) Late trading 
C) Price arbitrage 
D) Price dealing 
A) Forward pricing 
B) Late trading 
C) Price arbitrage 
D) Price dealing

Question 14

Which of the following occurs when an employee demands a payment from a vendor in order to make a decision in that vendor's favor?

Accepted Answer

A) Bribery 
B) Larceny 
C) Economic extortion 
D) Illegal gratuity 
A) Bribery 
B) Larceny 
C) Economic extortion 
D) Illegal gratuity

Question 15

Which of the following examples is NOT a billing scheme?

Accepted Answer

A) Mary purchases a new laptop for her brother-in-law with company's funds. 
B) Mark submits a receipt of his cab fare for reimbursement, which includes an extra $10. 
C) Joven double pays a vendor for the purchase of inventory and then pockets the second payment when it is returned. 
D) Harry submits invoices in the name of the dummy company and collects the amount. 
A) Mary purchases a new laptop for her brother-in-law with company's funds. 
B) Mark submits a receipt of his cab fare for reimbursement, which includes an extra $10. 
C) Joven double pays a vendor for the purchase of inventory and then pockets the second payment when it is returned. 
D) Harry submits invoices in the name of the dummy company and collects the amount.

Question 16

Which department or group accounted for the maximum percentage of fraud incidents according to the study conducted by ACFE in 2010?

Accepted Answer

A) sales 
B) accounting 
C) human resources 
D) top management 
A) sales 
B) accounting 
C) human resources 
D) top management

Question 17

Identify the two basic bribery schemes.

Accepted Answer

A) Larceny and skimming 
B) Kickbacks and bid-rigging 
C) Economic extortion and illegal gratuity 
D) Lapping and extortion 
A) Larceny and skimming 
B) Kickbacks and bid-rigging 
C) Economic extortion and illegal gratuity 
D) Lapping and extortion

Question 18

The most common occupational frauds in small businesses involve employees doing all of the following EXCEPT:

Accepted Answer

A) skimming revenues. 
B) fraudulently writing company checks. 
C) processing fraudulent invoices. 
D) altering financial statement. 
A) skimming revenues. 
B) fraudulently writing company checks. 
C) processing fraudulent invoices. 
D) altering financial statement.

Question 19

According to the ACFE study described in the text,which fraudulent disbursement scheme occurs most frequently?

Accepted Answer

A) Billing scheme 
B) Wire transfers 
C) Payroll scheme 
D) Register disbursements 
A) Billing scheme 
B) Wire transfers 
C) Payroll scheme 
D) Register disbursements

Question 20

Two basic fraudulent register disbursement schemes are:

Accepted Answer

A) purchase schemes and sales schemes. 
B) bid-rigging schemes and kickbacks. 
C) ghost employees and commission schemes. 
D) false refunds and false voids. 
A) purchase schemes and sales schemes. 
B) bid-rigging schemes and kickbacks. 
C) ghost employees and commission schemes. 
D) false refunds and false voids.

Which of the following is NOT one of the most common types of billing schemes?

A conflict of interest occurs when:

What is the point of difference between illegal gratuity and bribery scheme?

Employees,vendors,and customers of organizations have three opportunities to steal assets.Which of the following is NOT one among them?

Which function of the victim company is usually involved in Kickback schemes?

Thefts of inventory are divided into two groups.Identify them.

What is known as the net asset value (NAV)?

What is the term that describes allowing selected investors to purchase mutual funds after 4:00 p.m.,using that day's net asset value (NAV),rather than the next day's NAV,as required under the law?

Which of the following is the best example of theft of cash through skimming?

Which of the following is an example of a register-disbursement scheme?

An ice cream store cashier sells two-scoop ice cream cones to customers and enters the sales as single-scoop sales,while keeping the difference for himself.Which fraud is being committed here?

For ghost-employee fraud schemes to work,four things must happen.Which of the following is NOT one among them?

Orders placed for buying shares of a mutual fund any time up to 4:00 p.m.are priced at that day's net asset value (NAV),and orders placed after 4:01 p.m.are priced at the next day's NAV.What is this practice known as?

Which of the following occurs when an employee demands a payment from a vendor in order to make a decision in that vendor's favor?

Which of the following examples is NOT a billing scheme?

Which department or group accounted for the maximum percentage of fraud incidents according to the study conducted by ACFE in 2010?

Identify the two basic bribery schemes.

The most common occupational frauds in small businesses involve employees doing all of the following EXCEPT:

According to the ACFE study described in the text,which fraudulent disbursement scheme occurs most frequently?

Two basic fraudulent register disbursement schemes are:

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

Financial Statement Fraud

Revenue- and Inventory-Related Financial Statement Frauds

Liability, asset, and Inadequate Disclosure Frauds

Consumer Fraud

Bankruptcy, divorce, and Tax Fraud

E-Commerce Fraud

Legal Follow-Up

Filters

Exam 14: Fraud Against Organizations

Which of the following is NOT one of the most common types of billing schemes?

A conflict of interest occurs when:

What is the point of difference between illegal gratuity and bribery scheme?

Employees,vendors,and customers of organizations have three opportunities to steal assets.Which of the following is NOT one among them?

Which function of the victim company is usually involved in Kickback schemes?

Thefts of inventory are divided into two groups.Identify them.

What is known as the net asset value (NAV)?

What is the term that describes allowing selected investors to purchase mutual funds after 4:00 p.m.,using that day's net asset value (NAV),rather than the next day's NAV,as required under the law?

Which of the following is the best example of theft of cash through skimming?

Which of the following is an example of a register-disbursement scheme?

An ice cream store cashier sells two-scoop ice cream cones to customers and enters the sales as single-scoop sales,while keeping the difference for himself.Which fraud is being committed here?

For ghost-employee fraud schemes to work,four things must happen.Which of the following is NOT one among them?

Orders placed for buying shares of a mutual fund any time up to 4:00 p.m.are priced at that day's net asset value (NAV),and orders placed after 4:01 p.m.are priced at the next day's NAV.What is this practice known as?

Which of the following occurs when an employee demands a payment from a vendor in order to make a decision in that vendor's favor?

Which of the following examples is NOT a billing scheme?

Which department or group accounted for the maximum percentage of fraud incidents according to the study conducted by ACFE in 2010?

Identify the two basic bribery schemes.

The most common occupational frauds in small businesses involve employees doing all of the following EXCEPT:

According to the ACFE study described in the text,which fraudulent disbursement scheme occurs most frequently?

Two basic fraudulent register disbursement schemes are:

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

Financial Statement Fraud

Revenue- and Inventory-Related Financial Statement Frauds

Liability, asset, and Inadequate Disclosure Frauds

Consumer Fraud

Bankruptcy, divorce, and Tax Fraud

E-Commerce Fraud

Legal Follow-Up

Filters