Question 1

The fraud triangle includes all of the following EXCEPT:

Accepted Answer

A)  Validation
B)  Perceived opportunity
C)  Rationalization
D)  Perceived pressure A

Question 2

What is the most important element in a control environment?

Accepted Answer

A)  Management's communication
B)  Management's role and example
C)  The hiring process
D)  The internal audit department

Question 3

Which of the following is usually the most expensive of all control procedures?

Accepted Answer

A)  Documents and records
B)  Segregation of duties
C)  System of authorizations
D)  Independent checks

Question 4

Which of the following creates opportunities for fraud?

Accepted Answer

A)  Requirement to change passwords on a regular basis
B)  Inability to judge quality of performance
C)  Controls that prevent or detect fraud
D)  Segregation of duties

Question 5

Which of the following factors creates an opportunity for fraud?

Accepted Answer

A)  Greed
B)  Living beyond one's means
C)  Lack of an audit trail
D)  The organization owes it to me

Question 6

Financial statement fraud is typically committed by:

Accepted Answer

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

Question 7

​Which of the following about rationalization is NOT true?

Accepted Answer

A)  ​Rationalization is a form of self-justification.
B)  ​Rationalization is a way to lie to one's self.
C)  ​People who rationalize feel they are basically honest people.
D)  ​Rationalizing is unnecessary when there are multiple opportunities present to commit fraud.

Question 8

Which of the following statements about accounting systems is incorrect?

Accepted Answer

A)  An effective accounting system provides an audit trail that allows frauds to be discovered.
B)  An effective accounting system makes concealment difficult.
C)  An effective accounting system can effectively prevent "kickbacks."
D)  Without a good accounting system, it is often difficult to distinguish between actual fraud and unintentional error.

Question 9

A fraud perpetrator uses the float time between banks to give the impression that he had money in his accounts.Which crime is he committing?

Accepted Answer

A)  Floating
B)  Strip
C)  Spinning
D)  Kiting

Question 10

Which of the following people is most likely to have opportunities to commit fraud?

Accepted Answer

A)  Rob is a convicted bank robber who has been out of jail for 7 years and is working for a small firm whose manager knows about Rob's criminal background.
B)  Jane is a recent high school graduate who loves shopping.She is on the look out for a job.
C)  Steve was just hired by his company but he is always acting suspicious
D)  62 year old Dave has loyally worked up his company's corporate ladder for the past 24 years

Question 11

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)  Supervisory review of each task completed by employees.

Question 12

What is the strongest factor in deterring future fraud activity?

Accepted Answer

A)  Legal prosecution.
B)  Sanctions.
C)  Termination.
D)  Counseling. A

Question 13

A fraud perpetrator is able to convince a potential victim that he will receive a large bonus if he supports him in a fraud scheme.Which type of power is the fraud perpetrator using?

Accepted Answer

A)  Expert power
B)  Coercive power
C)  Legitimate power
D)  Reward power D

Question 14

___________ requires every public company to have a code of ethics to help deter wrongdoing.

Accepted Answer

A)  The Glass Steagall legislation
B)  The Sarbanes-Oxley legislation
C)  The Securities Act
D)  Generally Accepted Auditing Standards

Question 15

Every fraud is comprised of all the following elements EXCEPT:

Accepted Answer

A)  The theft act
B)  Concealment
C)  Conversion
D)  Assault

Question 16

Each of the following is an example of an abuse of a 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 her immediate assistant.
C)  A company has established codes of conduct and conducts training meetings to teach employees to distinguish between acceptable and unacceptable behavior.Attendance is voluntary.
D)  The employees know who has responsibility for each business activity.Procedures to follow are in place.

Question 17

​Studies reveal that honesty levels in advaned countries are decreasing.What do these findings indicate for the future regarding fraud?

Accepted Answer

A)  ​Rationalizations will become more sophisticated.
B)  ​Pressures to commit fraud will increase.
C)  ​Less perceived opportunity will have to be present.
D)  ​Honesty tests in the workplace will increase.

Question 18

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

Question 19

​Which of the following is NOT a work-related pressure?

Accepted Answer

A)  ​fear of losing one's job
B)  ​wanting to appear successful
C)  ​getting overlooked for a promotion
D)  ​insufficient/little recognition for work performance

Question 20

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

Exam 2: Who Commits Fraud and Why

The fraud triangle includes all of the following EXCEPT:

Correct AnswerverifiedA

What is the most important element in a control environment?

Correct AnswerverifiedShow Answer

Which of the following is usually the most expensive of all control procedures?

Correct AnswerverifiedShow Answer

Which of the following creates opportunities for fraud?

Correct AnswerverifiedShow Answer

Which of the following factors creates an opportunity for fraud?

Correct AnswerverifiedShow Answer

Financial statement fraud is typically committed by:

Correct AnswerverifiedShow Answer

​Which of the following about rationalization is NOT true?

Correct AnswerverifiedShow Answer

Which of the following statements about accounting systems is incorrect?

Correct AnswerverifiedShow Answer

A fraud perpetrator uses the float time between banks to give the impression that he had money in his accounts.Which crime is he committing?

Correct AnswerverifiedShow Answer

Which of the following people is most likely to have opportunities to commit fraud?

Correct AnswerverifiedShow Answer

Which of the following is NOT a possible control activity?

Correct AnswerverifiedShow Answer

What is the strongest factor in deterring future fraud activity?

Correct AnswerverifiedA

A fraud perpetrator is able to convince a potential victim that he will receive a large bonus if he supports him in a fraud scheme.Which type of power is the fraud perpetrator using?

Correct AnswerverifiedD

___________ requires every public company to have a code of ethics to help deter wrongdoing.

Correct AnswerverifiedShow Answer

Every fraud is comprised of all the following elements EXCEPT:

Correct AnswerverifiedShow Answer

Each of the following is an example of an abuse of a control environment EXCEPT:

Correct AnswerverifiedShow Answer

​Studies reveal that honesty levels in advaned countries are decreasing.What do these findings indicate for the future regarding fraud?

Correct AnswerverifiedShow Answer

Most fraud perpetrators have profiles that look like:

Correct AnswerverifiedShow Answer

​Which of the following is NOT a work-related pressure?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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Which of the following about rationalization is NOT true?

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D

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Studies reveal that honesty levels in advaned countries are decreasing.What do these findings indicate for the future regarding fraud?

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Which of the following is NOT a work-related pressure?

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