Latest ACFE CFE-Fraud-Prevention Actual Free Exam Questions & Community Discussion, Page 1

Question #1

Which of the following BEST reduces the risk of collusion among employees?

A. Reducing management oversight

B. Relying solely on segregation of duties

C. Independent monitoring and surprise reviews

D. Eliminating internal audits

Discussion 0

Correct Answer: C Vote an answer

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Question #2

The internal auditor's fraud-related responsibilities include which of the following?

A. Issuing a report asserting that the organization's financial statements do not contain material misstatements caused by fraud.

B. Reporting to regulators regarding the entity's vulnerability to fraud.

C. Evaluating the organization's structures and process for fraud risk governance.

D. Overseeing management's actions to manage fraud risks.

Discussion 0

Correct Answer: C Vote an answer

Question #3

Which of the following Is NOT considered a conflict of Interest that Is prohibited under the ACFE Code of Professional Ethics?

A. Undertaking engagements for both sides in a case of an alleged product substitution scheme

B. Accepting an assignment to assess red flags of fraud at an organization in which the fraud examiner is a partner, provided the fraud examiner's ownership interest is disclosed

C. Accepting an assignment to secretly infiltrate the fraud examiner's employing organization and transmit inside information to another party

D. Undertaking an engagement that decreases the fraud examiner's ability to perform their duties for their full-time employer

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Correct Answer: B Vote an answer

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Question #4

Risk management is focused on balancing the organization's___________with Its____________.

A. Internal controls; financial reporting model

B. Regulatory requirements, risk appetite

C. Risk appetite, ability to meet its objectives

D. Objectives; resources

Discussion 0

Correct Answer: C Vote an answer

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Question #5

According to ACFE research, which of the following is TRUE regarding the three major categories of occupational fraud?

A. Financial statement fraud schemes are the most common category of occupational fraud.

B. Corruption schemes are the costliest category of occupational fraud.

C. Asset misappropriation schemes are the most common category of occupational fraud.

D. Identity theft is both the most common and costliest category of occupational fraud.

Discussion 0

Correct Answer: C Vote an answer

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Question #6

Which of the following is NOT included in G20/OECD Principles of Corporate Governance (the Principles)?

A. A request that governments have in place an appropriate framework to support good corporate governance practices

B. Support for establishing stronger protection for foreign shareholders than for domestic shareholders

C. Guidance regarding appropriate board structures, responsibilities, and procedures

D. Recognition of the importance of the role of stakeholders in corporate governance

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Correct Answer: B Vote an answer

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Question #7

Susannah Is conducting an external audit of a company In a jurisdiction that is subject to International Standards on Auditing (ISAs). While undertaking her audit procedures, she discovers evidence that senior management has been fraudulently manipulating the financial statements. Which of the following is Susannah's BEST response to these findings?

A. Susannah should Immediately report her findings to the secunties regulators

B. Susannah should not disclose her findings to any other parties due to client confidentiality.

C. Susannah should report her findings to the audit committee of the board of directors.

D. Susannah should confront management with her audit findings and try to get a confession.

Discussion 0

Correct Answer: C Vote an answer

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Question #8

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. Financial statement fraud: corruption

C. Corruption, asset misappropriation

D. Asset misappropriation: financial statement fraud

Discussion 0

Correct Answer: D Vote an answer

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Question #9

Gray, an independent Certified Fraud Examiner (CFE), was hired by Green, president of the ABC Corporation, to investigate allegations that one of ABC's employees is taking kickbacks. During the investigation. Gray teams that Green is involved in an unrelated fraud. Under the ACFE Code of Professional Ethics. Gray should:

A. Tell the company's board of directors about Green.

B. Resign from the engagement

C. Not disclose the information about Green.

D. Report Green to law enforcement

Discussion 0

Correct Answer: A Vote an answer

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Question #10

According to the 2020 Report to the Nations, which of the following is the MOST COMMON method by which frauds are detected?

A. Internal audit

B. Confession

C. External audit

D. Tips

Discussion 0

Correct Answer: D Vote an answer

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Question #11

Which of the following is TRUE regarding a background check policy for employees?

A. When verifying past employment, management should only ask previous employers to verify the candidate's previous position and dates of employment.

B. As part of the screening process, management should contact the personal and professional references provided by the job candidate only if they are unsure whether the candidate is being honest.

C. Management should perform a background check on any candidate who will have access to cash, checks, credit card numbers, or other items that are easily stolen.

D. If a background check was conducted on an employee at the time of hire, then there is no need for management to conduct additional background checks on that employee during their employment.

Discussion 0

Correct Answer: C Vote an answer

Question #12

Alicia, a government auditor, is conducting a financial statement audit of a public-sector entity in accordance with the International Standards of Supreme Audit Institutions. Which of the following is TRUE regarding Alicia's consideration of fraud during this engagement?

A. Alicia must comply with the requirements found in International Standard on Auditing 240 as they apply to both private- and public-sector audits.

B. In conducting the audit, Alicia's objectives are likely narrower than those of a private-sector financial statement audit.

C. Alicia should focus on potential fraud and does not need to consider the possibility of abuse or other misconduct during the audit engagement.

D. If Alicia identifies fraud during the audit engagement, she must immediately withdraw from the engagement.

Discussion 0

Correct Answer: A Vote an answer

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Question #13

The objective of anti-fraud controls is to:

A. Reduce the inherent fraud risk to a level that is significantly smaller than the residual fraud risk.

B. Reduce the residual fraud risk to a level that is significantly smaller than the inherent fraud risk

C. Completely eliminate residual fraud risk

D. Completely eliminate inherent fraud risk.

Discussion 0

Correct Answer: B Vote an answer

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Question #14

In the context of a fraud examination, integrity requires which of the following:

A. Ability to conceal errors to preserve the reliability of the work performed

B. Independence of mental attitude and avoidance of conflicts of interest

C. Prioritization of desires for personal gain over the interests of clients

D. Avoidance of differences of opinion on all material matters

Discussion 0

Correct Answer: B Vote an answer

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