Chapter 8

Question 1

list the AIS threats

Answer 1

• natural and political disasters
• software errors
• unintentional acts
• intentional acts

Question 2

for an act to be fraudulent there must be

Answer 2

• false statement, representation, disclosure
• a material fact
• intent to deceive
• justifiable reliance
• injury or loss suffered by victim

Question 3

corruption

Answer 3

dishonest conduct by those in power and often involves actions that are illegitimate, immoral, or incompatible with ethical standards

Question 4

investment fraud

Answer 4

mispresenting or leaving out facts in order to promote an investment that promises fantastic profits with little to no risk

Question 5

misappropriation of assets

Answer 5

theft of company assets by employees

Question 6

fraudulent financial reporting

Answer 6

intentional or reckless conduct that results in materially misleading financial statements

Question 7

ways to detect fraud

Answer 7

understand fraud, improve internal controls based on analysis of fraud risk

Question 8

fraud triangle

Answer 8

pressure, opportunity, and rationalization

Question 9

list the pressures

Answer 9

financial, emotional, lifestyle

Question 10

list opportunities

Answer 10

commit, conceal, convert

Question 11

rationalizaions

Answer 11

justification, attitude, lack of personal integrity

Question 12

computer fraud classification

Answer 12

input fraud, processor fraud, computer instructions fraud, data fraud, output fraud

Question 13

input fraud

Answer 13

alter or falsify computer input

Question 14

processor fraud

Answer 14

unauthorized system use, including theft of computer time and services

Question 15

computer instructions fraud

Answer 15

tampering with company software, copying software illegally, using software in an unauthorized manner, and developing software to carry out an unauthorized activity

Question 16

data fraud

Answer 16

illegally using, copying, browsing, searching, or harming company data

Question 17

output fraud

Answer 17

displayed or printed output can be stolen, copied, or misused

Question 18

to prevent fraud ….

Answer 18

organizations must create a climate that makes fraud less likely, increases the difficulty of committing it, improves detection methods, and reduced amount lost if a fraud occurs

Question 19

segregation of duties

Answer 19

no single employee be given too much responsibility over business transactions or processes

Question 20

effective segregation of accounting duties is achieved when the following functions are separated

Answer 20

authorization, recording, custody