Lesson 3

Question 1

is the careful and responsible oversight and use of the asset entrusted to management.

Answer 1

Stewardship

Question 2

a set of documented guidlines for moral and ethicL behavior within the organization

Answer 2

code of ethics

Question 3

defines as the theft, concealment, and conversation to personal gain of another’s money, physical assets or information

Answer 3

Fraud

Question 4

involved theft of any item of value

Answer 4

Misappropriation of Asset

Question 5

Misappropriation of assets reffered to as a ______/_______

Answer 5

defalcation or internal theft

Question 6

involves for falsification of accouting reports

Answer 6

Misstatement of financial asset

Question 7

Misstatement of financial asset often reffered as

Answer 7

earnings management, or fraudulent financial reporting

Question 8

(3) Fraud Triangle

Answer 8

Incentive (pressure)
Opportunity
Rationalization

Question 9

conducted by one or more top level manager within the company

Answer 9

Management Fraud

Question 10

Involves top level management circumvention of the system pr internal controls that are in place, known as?

Answer 10

management override

Question 11

conducted by nonmanagement employees, means that an employee steal cash or assets for personal gain

Answer 11

Employee Fraud

Question 12

Inventory can be stolen or misdirect

Answer 12

Inventory theft

Question 13

this occured when an employee steal cash from company

Answer 13

Cash Receipt Theft

Question 14

employee may submit false invoice

Answer 14

Account Payable Fraud

Question 15

is a cash payment that the vendor gives the employee in exchnage for the sale

Answer 15

Kickback

Question 16

This occur when an employee submit a false or inflated time card

Answer 16

Payroll Fraud

Question 17

this occur when an employee submit false travel or entertainment expence

Answer 17

expence account fraud

Question 18

technique where the organization’s cash is stolen before it entered into the accouting record

Answer 18

Skimming

Question 19

Fraudster may also steal the company’s cash after in has been record in accoutning records

Answer 19

larceny

Question 20

when two or more people word together to commit fraud

Answer 20

Collusion

Question 21

occur when a costumer improperly obtains cash or property from a company

Answer 21

Costumer Fraud

Question 22

involves the costumer use of stolen or fraudulent credit card or checks

Answer 22

Credit card fraud and Check Fraud

Question 23

occurs when a costumer tries to return stopen goods to collect a cash refund

Answer 23

Refund Fraud

Question 24

occurs when vendors obtain payment to which they are not entitled

Answer 24

Vendor Fraud

Question 25

Involve the examination of vendors record in support of amount charged to the company

Answer 25

Vendor audits

Question 26

the theft of proprietory company information, by digging to the trash of the intended target company

Answer 26

industrial espionage

Question 27

the umlawful copying of software programs

Answer 27

software piracy

Question 28

to alter a program to slice a small amount from several accounts and then credit those small amounts to the perpetra‑ tor’s benefit.

Answer 28

salami technique

Question 29

is a small, unauthorized program within a larger, legiti‑ mate program, used to manipulate the computer system to conduct a fraud.

Answer 29

trojan Horse program

Question 30

is a valid programming tool that is misused to commit fraud.

Answer 30

trapdoor alterations

Question 31

the term commonly used for computer network break‐ins. Hacking may be undertaken for various reasons, including industrial espionage, credit card theft from online databases, destruction or alteration of data, or merely thrill‐seeking.

Answer 31

Hacking

Question 32

is intended to overwhelm an intended target computer system with so much bogus network traffic that the system is unable to respond to valid network traffic.

Answer 32

a denial of service attack

Question 33

occurs when a person, through a computer system, pretends to be someone else

Answer 33

spoofing

Question 34

The Act was intended to reform accounting, financial reporting, and auditing functions of companies that are publicly traded in stock exchanges.

Answer 34

Sarbanes Oxley Act

Question 35

are designed to avoid errors, fraud, or events not authorized by management.

Answer 35

preventive control

Question 36

help employees to uncover or discover errors, fraud, or unauthorized events.

Answer 36

detective control

Question 37

are those steps undertaken to correct an error or problem uncovered via detective controls

Answer 37

corrective control

Question 38

has provided the standard definition and description of internal control accepted by the accounting industry

Answer 38

Coso report

Question 39

sets the tone of an organization and influences the control consciousness of its employees

Answer 39

control environment

Question 40

as the policies and procedures that help ensure that management directives are carried out and that management objectives are achieved.

Answer 40

control activities

Question 41

refers to an approval, or endorsement, from a responsible person or department in the organization that has been sanctioned by top management.

Answer 41

authorization

Question 42

s a set of guidelines that allows transactions to be completed as long as they fall within established parameter

Answer 42

general authorization

Question 43

means that explicit approval is needed for a transaction to be completed.

Answer 43

specific authorization

Question 44

When management delegates authority and develops guide‑ lines as to the use of that authority, it must assure that the authorization is separated from other duties. This separation of related duties is called

Answer 44

segregation duties

Question 45

which presents verifiable information about the accuracy of accounting records.

Answer 45

audit trail

Question 46

Organizations should establish control activities to safeguard their assets, documents, and records.

Answer 46

Security of Assets and Documents

Question 47

a procedure that compares records from different sources.

Answer 47

reconciliation

Question 48

involves the ongoing review and evaluation of the systems

Answer 48

monitoring

Question 49

The risk related to security is unauthorized access, which may be both physical access and logical access.

Answer 49

Security

Question 50

The risk related to availability is system or subsystem failure due to hardware or software problems.

Answer 50

Availability

Question 51

The risk related to processing integrity could be inaccu‑ rate, incomplete, or improperly authorized information.

Answer 51

processing integrity

Question 52

The risk in this area is that personal information about cus‑ tomers may be used inappropriately or accessed by those either inside or outside the company.

Answer 52

online privacy

Question 53

The risk related to confidentiality is that confidential infor‑ mation about the company or its business partners may be subject to unau‑ thorized access during its transmission or storage in the IT system. Examples of confidential information are banking information and price lists.

Answer 53

confidentiality