Question 1

What is the most important element of the 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 2

Which of the following is not a component of the internal control structure?

Accepted Answer

A)  Control Environment 
B)  Accounting System 
C)  Management Operations 
D)  Control Activities 
A)  Control Environment 
B)  Accounting System 
C)  Management Operations 
D)  Control Activities

Question 3

Which of the following is not a possible control activity:

Accepted Answer

A)  Having separate authorization, bookkeeping, and custody functions. 
B)  Protecting access to important information with a password. 
C)  Requiring two individuals to work on the same task. 
D)  All are control activities. 
A)  Having separate authorization, bookkeeping, and custody functions. 
B)  Protecting access to important information with a password. 
C)  Requiring two individuals to work on the same task. 
D)  All are control activities.

Question 4

Modeling and labeling are sub-components of which control structure component:

Accepted Answer

A)  Control environment. 
B)  Accounting system. 
C)  Control procedures. 
A)  Control environment. 
B)  Accounting system. 
C)  Control procedures.

Question 5

Each of the following is an example of an inadequate control environment EXCEPT:

Accepted Answer

A)  The HR department failed to check an applicant's background and hired someone who had committed fraud in the past. 
B)  A manager instructs employees not to share passwords, and then shares her passwords with others. 
C)  A company does not establish codes of conduct and does not have training meetings to teach employees to distinguish between acceptable and unacceptable behavior. 
D)  The employees know who has responsibility for each business activity. 
A)  The HR department failed to check an applicant's background and hired someone who had committed fraud in the past. 
B)  A manager instructs employees not to share passwords, and then shares her passwords with others. 
C)  A company does not establish codes of conduct and does not have training meetings to teach employees to distinguish between acceptable and unacceptable behavior. 
D)  The employees know who has responsibility for each business activity.

Question 6

Which of the following creates opportunities for fraud?

Accepted Answer

A)  An audit trail 
B)  Inability to judge quality of performance 
C)  Controls that prevent or detect fraud 
D)  Disciplining fraud perpetrators 
A)  An audit trail 
B)  Inability to judge quality of performance 
C)  Controls that prevent or detect fraud 
D)  Disciplining fraud perpetrators

Question 7

Work-related pressures that people use to justify their actions include:

Accepted Answer

A)  Dissatisfaction with their job 
B)  Believing that they are underpaid 
C)  Forced to work too many hours 
D)  All of the above 
A)  Dissatisfaction with their job 
B)  Believing that they are underpaid 
C)  Forced to work too many hours 
D)  All of the above

Question 8

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

Accepted Answer

A)  Financial pressure 
B)  Perceived opportunity 
C)  Rationalization 
A)  Financial pressure 
B)  Perceived opportunity 
C)  Rationalization

Question 9

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 10

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

Accepted Answer

A)  Financial 
B)  Peer 
C)  Vice 
D)  Barometric 
E)  Work Related 
A)  Financial 
B)  Peer 
C)  Vice 
D)  Barometric 
E)  Work Related

Question 11

All of the following are primary control activities (procedures) except:

Accepted Answer

A)  Physical safeguards 
B)  System of authorizations 
C)  Audit Trail 
D)  Documents and records 
E)  All of the above are primary control activities 
A)  Physical safeguards 
B)  System of authorizations 
C)  Audit Trail 
D)  Documents and records 
E)  All of the above are primary control activities

Question 12

A nurse was charged with embezzling money from patients' rooms at a hospital because of which noncontrol factor:

Accepted Answer

A)  Lack of an audit trail 
B)  Ignorance, apathy, and incapacity 
C)  Failure to discipline fraud perpetrators 
D)  Inability to judge the quality of performance 
A)  Lack of an audit trail 
B)  Ignorance, apathy, and incapacity 
C)  Failure to discipline fraud perpetrators 
D)  Inability to judge the quality of performance

Question 13

Which of the following attributes is a fraud perpetrator most likely to possess?

Accepted Answer

A)  Criminal Record 
B)  Less Educated 
C)  Alcohol Abuser 
D)  Religious 
A)  Criminal Record 
B)  Less Educated 
C)  Alcohol Abuser 
D)  Religious

Question 14

Financial statement fraud is typically committed by:

Accepted Answer

A)  Employees with access to company assets 
B)  Top management 
C)  Customers 
D)  Vendors 
A)  Employees with access to company assets 
B)  Top management 
C)  Customers 
D)  Vendors

Question 15

Which of the following is false?

Accepted Answer

A)  95% of all frauds involve financial or vice related pressures 
B)  When the IRS required social security numbers for dependents, the number of dependents went down 
C)  Over half of all people are honest at all times 
D)  Only about a third of all frauds are committed by employees with less than four years in a company 
A)  95% of all frauds involve financial or vice related pressures 
B)  When the IRS required social security numbers for dependents, the number of dependents went down 
C)  Over half of all people are honest at all times 
D)  Only about a third of all frauds are committed by employees with less than four years in a company

Question 16

Most fraud perpetrators have profiles that look like:

Accepted Answer

A)  Those of other honest people 
B)  Those with criminal records 
C)  Those who are uneducated 
D)  Those who use alcohol and drugs 
A)  Those of other honest people 
B)  Those with criminal records 
C)  Those who are uneducated 
D)  Those who use alcohol and drugs

What is the most important element of the control environment?

Which of the following is not a component of the internal control structure?

Which of the following is not a possible control activity:

Modeling and labeling are sub-components of which control structure component:

Each of the following is an example of an inadequate control environment EXCEPT:

Which of the following creates opportunities for fraud?

Work-related pressures that people use to justify their actions include:

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

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

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

All of the following are primary control activities (procedures) except:

A nurse was charged with embezzling money from patients' rooms at a hospital because of which noncontrol factor:

Which of the following attributes is a fraud perpetrator most likely to possess?

Financial statement fraud is typically committed by:

Which of the following is false?

Most fraud perpetrators have profiles that look like:

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

Fraud in E-Commerce

Legal Follow-Up

Filters

Exam 2: Why People Commit Fraud

What is the most important element of the control environment?

Which of the following is not a component of the internal control structure?

Which of the following is not a possible control activity:

Modeling and labeling are sub-components of which control structure component:

Each of the following is an example of an inadequate control environment EXCEPT:

Which of the following creates opportunities for fraud?

Work-related pressures that people use to justify their actions include:

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

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

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

All of the following are primary control activities (procedures) except:

A nurse was charged with embezzling money from patients' rooms at a hospital because of which noncontrol factor:

Which of the following attributes is a fraud perpetrator most likely to possess?

Financial statement fraud is typically committed by:

Which of the following is false?

Most fraud perpetrators have profiles that look like:

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

Fraud in E-Commerce

Legal Follow-Up

Filters