Fraud Examination

Question 1

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

Answer 1

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

Question 2

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

Question 3

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

Question 4

Effective fraud prevention involves two fundamental activities:

Question 5

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

Question 6

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

Question 7

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

Question 8

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

Question 9

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

Question 10

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

Question 11

Organizations can proactively eliminate most fraud opportunities by

Question 12

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

Question 13

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

Question 14

Accurately identifying sources and measuring risks involves

Question 15

Questions to ask to accurately identify sources and measure risk

Question 16

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

Question 17

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

Question 18

There are three primary ways to detect fraud:

Question 19

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

Question 20

Predication

Question 21

Fraud investigation methods can be classified according to

Question 22

The four types of evidence:

Question 23

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

Question 24

Personal observation involves

Question 25

The three sides of the Fraud Motivation Triangle

Question 26

The three sides of the Fraud Element Triangle

Question 27

To Maintain high ethics in conducting investigations, at a minimum, it is important that:

Question 28

What is the purpose of a civil action

Question 29

What is the purpose of a Criminal Action

Question 30

It’s estimated that most organizations lose __ % of revenue to fraud

Question 31

It’s estimated that most organizations lose __ % of revenue to fraud

Question 32

If you have a 10 percent margin to recover $10,000 in stolen net income, you must produce $___ in revenue.

Question 33

___ is the single most critical element for fraud to be successful.

Question 34

an effective _ _ _ is probably the most important step an organization can take to prevent and detect employee fraud.

Question 35

The organization that established the common internal control framework that most businesses subscribe to is the

Question 36

a good internal control framework for an organization should include

Question 37

A good accounting system should ensure that information (particularly transactions) are

Question 38

<div>The five basic control activities (SAPID):</div>

Question 39

One shouldn’t weigh costs to benefits when it comes to fraud

Question 40

<ul>
<li>What are the three critical functions that even small business owners should either set up as segregated duties or always do themselves.<ol>
</ol>
</li></ul>

Question 41

Segregation of Duties is most often used when _ is involved

Question 42

Periodic job rotations, required vacations, cash counts or certifications, supervisor reviews, employee hot lines, and the use of auditors are all forms of

Question 43

As a basic control activity documents and records are used to leave an 

Question 44

SAPID, the first three (SAP) _ fraud. The last two (ID) _ fraud.

Question 45

Apart from a lack of controls what is another reason frauds are perpretrated

Question 46

The Committee of Sponsoring Organizations’ (COSO) states that a good internal control framework for an organization should include

Question 47

Section 406 of the Sarbanes-Oxley Act of 2002, “Code of Ethics for Senior Financial Officers,” requires that

Question 48

Section 406 of the Sarbanes-Oxley Act of 2002, “Code of Ethics for Senior Financial Officers,” requires that

Question 49

Shortly after Section 406 of the Sarbanes-Oxley Act of 2002, The Securities and Exchange Commission (SEC) revised its listing standards to require

Question 50

Have a code of ethics or conduct to help deter wrongdoing and to promote the following:

Question 51

Literature on moral development suggests that if you want someone to behave honestly, you must both _ and _ honest behavior.