Practice Free CFE Fraud Prevention and Deterrence Exam Online Questions
To reinforce an anti-fraud culture, it is BEST for an organization’s management to:
- A . Use a checklist of initiatives to ensure that all the elements of a strong corporate culture are in place.
- B . Demonstrate the same ethical behavior required of individuals at lower levels of the company.
- C . Discipline any employees who question their direct supervisor’s behavior or policies.
- D . Discourage employees from voicing concerns regarding senior leadership’s actions or decisions.
In response to a risk identified during a fraud risk assessment, management decides to implement additional internal control measures.
This response is known as:
- A . Assuming the risk
- B . Mitigating the risk
- C . Avoiding the risk
- D . Transferring the risk
Which of the following is included in the G20/OECD Principles of Corporate Governance?
- A . A requirement for corporations to establish a legal, regulatory, and institutional framework to support good governance practices
- B . A call to support the equal treatment of all members of an organization’s governing body
- C . Guidance regarding appropriate board structures, responsibilities, and procedures
- D . An examination of the importance of effectively designed and implemented internal control mechanisms within an organization
Which of the following theories suggests that, when considering the possibility of violating a law. people are likely to ask themselves. "What will my spouse think if they find out?"
- A . Social control theory
- B . Operant theory
- C . Cognitive theory
- D . Behavioral theory
Which of the following scenarios would MOST LIKELY be considered a violation of the ACFE Code of Professional Ethics?
- A . Grace, a CFE, uncovered internal control deficiencies that were material but unrelated to the financial statement fraud she was investigating. In her final report to management, Grace included information about the deficiencies despite their being unrelated to the situation she was hired to investigate.
- B . Eric, a CFE, accepted a fraud examination assignment and then instructed his employee to assess the company’s accounts receivable for indications of fraud. He accepted the employee’s work that showed no evidence of fraud without conducting his own assessment. However, the employee missed some key information, causing Eric to fail to uncover a costly fraud scheme.
- C . Mae, a CFE, was hired by a client to conduct a fraud examination but found nothing unusual. A year later, she received a legal order from the local prosecutor’s office to provide the client’s file. Mae complied with the court order despite not having the client’s authorization to provide the file.
- D . All of the above are violations.
XYZ, Inc. Is a specialty retailer of high-end ergonomic office furniture. The company receives a very large order from ABC Company, a new customer in a different country that wants to pay on credit.
Which of the following is MOST ACCURATE regarding the due diligence procedures XYZ should perform on ABC before proceeding with this transaction?
- A . XYZ only needs to undertake due diligence procedures if ABC conducts business in countries with known corruption risks.
- B . XYZ does not need to take any specific procedures to verify ABC’s identity before accepting the transaction
- C . XYZ should examine ABC’s net worth as part of deciding whether to allow the purchase on credit.
- D . XYZ should perform the same level of due diligence as it would for any other customer to avoid claims of discrimination
Who is ultimately responsible lor ensuring the effectiveness of the organization’s anti-fraud program?
- A . Internal auditors
- B . The compliance function
- C . Management
- D . External auditors
According to Silk and Vogel’s research, business leaders rationalize legal violations by asserting that compliance with government regulations is too costly and cuts too heavily into company profits.
- A . True
- B . False
According to the 2020 Report to the Nations.___________schemes ate the MOST COMMON form of occupational fraud, while_________schemes are the MOST COSTLY form of occupational fraud.
- A . Asset misappropriation; corruption
- B . Corruption, asset misappropriation
- C . Financial statement fraud: corruption
- D . Asset misappropriation: financial statement fraud
Which of the following scenarios is the MOST ACCURATE representation of organizational crime?
- A . A retail clerk colluding with a friend to commit a scheme involving fraudulent returns.
- B . An inventory manager taking home the company’s product to sell privately.
- C . An agreement between all the local floral companies to unnecessarily raise prices.
- D . An accountant uses company funds to pay personal credit card charges.