Fraud 1
What professional organization must you be a member of to obtain your CFE?
ACFE; Association of Certified Fraud Examiners
A journal in which all sales made on credit or cash are listed is:
A. Disbursement journal
B. Accounts receivable journal
C. Accounts payable journal
D. General journal
B. Accounts receivable journal
_______ is a process by which a bookkeeper records all transactions and can adjust the books.
A. Journal Entries
B. Accounting Cycle
C. Financial Statement
D. None of the above
A. Journal Entries
What is a professional certification available to fraud examiners?
CFE
Undisclosed payments made by vendors to employees of purchasing companies are referred to as:
A. Bid-rigging
B. Kickbacks
C. Presolicitation
D. None of the above
B. Kickbacks
Due to the paper trail involved and the emphasis placed on the problem by law enforcement, the vast majority of check fraud offenders are pursued and prosecuted.
A. True
B. False
B. False
_______ should be examined to see that all are properly documented and that inappropriate payments have not been made to employees.
A. Payable cash
B. Cash advances
C. Counterfeit checks
D. Payable checks
B. Cash advances
________ may be defined as the offering, giving, receiving or soliciting anything of value to influence an official act.
A. Corruption
B. Diverting business to vendors
C. Bribery
D. Lacking approval authority
C. Bribery
Which of the following can constitute a bribe, even if the illicit payment is never actually made?
A. Offering a payment
B. Corruption in payment
C. Kickback payment
D. Overbilling in payment
A. Offering a payment
The most common method of detection in corruption cases is:
A. Internal audits
B. Internal controls
C. Tips
D. By accident
C. Tips
People commit financial statement fraud to:
A. Conceal false business performances
B. Preserve personal status/control
C. Maintain personal income
D. Stand outside the accounting system
B. Preserve personal status/control
Sam, a controller for a small company, took a large sum of money from the company deposits and concealed the theft by making false accounting entries. The money that Sam stole had already been recorded in his company's accounting system. Sam's scheme can be best classified as a(n):
A. Cash larceny scheme
B. Illegal gratuities scheme
C. Fraudulent financial statement scheme
D. Skimming scheme
A. Cash larceny scheme
A _________ scheme involves the theft of cash BEFORE it appears on a company's books, and a ________ scheme involves the theft of cash AFTER it has appeared on the books.
A. Cash larceny; skimming
B. Skimming; cash larceny
C. Cash larceny; revenue
D. Fraudulent disbursement; skimming
In credit repair scams, the fraudster promises to "erase" or "doctor" an applicant's credit history, but in reality there is no way to erase bad credit.
A. True
B. False
A. True
A scheme is classified as a conflict of interest:
A. When an employee must have some kind of ownership or employment interest in the vendor submitting the invoice
B. When a salesman must have some kind of ownership or employment interest in the vendor submitting the sales
C. When a purchaser must have some kind of ownership or employment interest in the vendor submitting the purchase
D. When a dealer must have some kind of dealership interest in the vendor submitting the stock
A. When an employee must have some kind of ownership or employment interest in the vendor submitting the invoice.
According to Donald Cressey, what are the 3 legs of the fraud triangle?
Pressure, Opportunity, Rationalization
The forms that allow noncash assets to be moved from one location in a company to another that can be used to facilitate the misappropriation of those assets are called:
A. Inventory usages
B. Fake sales
C. Asset requisition
D. All of the above
C. Asset requisition
When an employee signs a legally enforceable noncompetition agreement, the provisions of the noncompetition agreement continue after the employee leaves where they signed the agreement?
A. True
B. False
A. True
When a victim company purchases unnecessary goods or services from a supplier at the direction of a corrupt employee, this results in:
A. Presolicitation scheme
B. Need recognition scheme
C. False sole-source scheme
D. Submission scheme
B. Need recognition scheme
In the fraud theory approach to fraud examination, it is necessary that the fraud examiner perform all of the following tasks, EXCEPT:
A. Analyze the available data
B. Create a hypothesis
C. Report the hypothesis to management
D. Refine and amend the hypothesis
C. Report the hypothesis to managment
GHJ Bank recently acquired a new portfolio of consumer loans. Because this particular loan portfolio is experiencing a higher than normal default rate, management has asked Scott, a CFE, to evaluate the portfolio. Scott notices that the loan package was sold without recourse to the broker, the brokerage fee was high relative to the other purchases, and the broker is no longer in business. Which of the following types of schemes has Bradley most likely uncovered?
A. Daisy chain fraud
B. Letter of credit fraud
C. Brokered loan fraud
D. Money transfer fraud
C. Brokered loan fraud
The method of concealing a receivables skimming scheme where one customer account is credited for a payment that was made on another account is called which of the following:
A. Altered payee designation
B. Inventory Padding
C. Currency Substitution
D. Lapping
D. Lapping
According to a survey, in principal perpetrator, males in a majority of cases accounted for ___ percent of frauds versus ___ percent in which a female was the primary culprit.
A. 62 versus 36
B. 61 versus 39
C. 62 versus 37
D. None of the above
B. 61 versus 39
The __________ is an office within the US Department of the Treasury charged with administering and enforcing U.S. sanction policies against targeted foreign organizations and individuals that sponsor terrorism and international narcotics traffickers.
A. CIA
B. FinCEN
C. Office of Foreign Assets Control
D. Office of Money Laundering Compliance
C. Office of Foreign Assets Control
The statute that specifically outlaws the giving or receiving of anything of value for the purpose of improperly obtaining or receiving favorable treatmentin connection with U.S. government contracts is:
A. The Foreign Corrupt Practices Act
B. The Anti-Kickback Act of 1986
C. The Civil False Claims Act
D. The Clayton Antitrust Act of 1914
B. The Anti-Kickback Act of 1986