Fraud Examination Flashcards

1
Q

The four activities on which money can be spent to mitigate the occurrence of fraud are;

A

<ol><li>Fraud Prevention</li><li>Early Fraud Detection</li><li>Fraud Investigation</li><li>Follow-up Legal Action and/or Resolution</li></ol>

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2
Q

___ is generally the most cost-effective way to reduce losses from fraud.

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3
Q

What are the two least effective and most expensive fraud fighting efforts.

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4
Q

Effective fraud prevention involves two fundamental activities:

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5
Q

Five of the most critical and common elements to create a culture of honesty and high ethics are

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6
Q

What are the 4 levels of the ethical maturity model (EMM) from highest to lowest

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7
Q

communicating the right expectations and requiring periodic written confirmation of acceptance of those expectations includes;

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8
Q

Factors that can create a negative environment and increase fraud include:

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9
Q

<div>An effective policy for handeling fraud when it occurs should include</div>

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10
Q

<div>A comprehensive fraud policy should define who is responsibilities for</div>

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11
Q

Organizations can proactively eliminate most fraud opportunities by

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12
Q

<div>An appropriate internal control system will include</div>

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13
Q

Questions to ask when implementing appropriate preventive and detective controls to mitigate those risks

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14
Q

Accurately identifying sources and measuring risks involves

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15
Q

Questions to ask to accurately identify sources and measure risk

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16
Q

The Sarbanes-Oxley Act of 2002 (Section 806 and 18 U.S.C. § 1513(e)) mandates every public company to establish

A
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17
Q

<div>To help employees prevent and detect fraud</div>

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18
Q

There are three primary ways to detect fraud:

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19
Q

Three reasons why auditors should investigate signs to determine whether or not actual fraud is occurring.

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20
Q

Predication

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21
Q

Fraud investigation methods can be classified according to

22
Q

The four types of evidence:

23
Q

Evidence from paper, computers, and other written or printed sources is Physical Evidence

24
Q

Personal observation involves

25
The three sides of the Fraud Motivation Triangle
26
The three sides of the Fraud Element Triangle
27
To Maintain high ethics in conducting investigations, at a minimum, it is important that:
28
What is the purpose of a civil action
29
What is the purpose of a Criminal Action
30
It's estimated that most organizations lose __ % of revenue to fraud
31
It's estimated that most organizations lose __ % of revenue to fraud
32
If you have a 10 percent margin to recover $10,000 in stolen net income, you must produce $___ in revenue.
33
___ is the single most critical element for fraud to be successful.
34
an effective _ _ _ is probably the most important step an organization can take to prevent and detect employee fraud.
35
The organization that established the common internal control framework that most businesses subscribe to is the
36
a good internal control framework for an organization should include
37
A good accounting system should ensure that information (particularly transactions) are
38
The five basic control activities (SAPID):
39
One shouldn't weigh costs to benefits when it comes to fraud
40
  • What are the three critical functions that even small business owners should either set up as segregated duties or always do themselves.
41
Segregation of Duties is most often used when _ is involved
42
Periodic job rotations, required vacations, cash counts or certifications, supervisor reviews, employee hot lines, and the use of auditors are all forms of
43
As a basic control activity documents and records are used to leave an 
44
SAPID, the first three (SAP) _ fraud. The last two (ID) _ fraud.
45
Apart from a lack of controls what is another reason frauds are perpretrated
46
The Committee of Sponsoring Organizations’ (COSO) states that a good internal control framework for an organization should include
47
Section 406 of the Sarbanes-Oxley Act of 2002, “Code of Ethics for Senior Financial Officers,” requires that
48
Section 406 of the Sarbanes-Oxley Act of 2002, “Code of Ethics for Senior Financial Officers,” requires that
49
Shortly after Section 406 of the Sarbanes-Oxley Act of 2002, The Securities and Exchange Commission (SEC) revised its listing standards to require
50
Have a code of ethics or conduct to help deter wrongdoing and to promote the following:
51
Literature on moral development suggests that if you want someone to behave honestly, you must both _ and _ honest behavior.