ACFE CFE-Fraud-Prevention-and-Deterrence Dumps Updated Feb 20, 2024 WIith 140 Questions
View All CFE-Fraud-Prevention-and-Deterrence Actual Free Exam Questions Feb 20, 2024 Updated
NEW QUESTION # 17
Jane, a Certified Fraud Examiner (CFE), was hired lo conduct a fraud examination at XYZ Company Her examination did not reveal any conclusive evidence that fraud had occurred or was occurring Consequently. XYZ's management asked Jane to state in her official examination report that the company is free of fraud as a means of assuring the board of directors that the company's anti-fraud controls were effective. The ACFE Code of Professional Ethics prohibits Jane from complying with management's request.
- A. False
- B. True
Answer: B
NEW QUESTION # 18
Which of the following theories suggests that, when considering the possibility of violating a law. people are likely to ask themselves. "What would my family and friends think if they find out?
- A. Behavioral theory
- B. Cognitive theory
- C. Social control theory
- D. Routine activities theory
Answer: C
NEW QUESTION # 19
Which of the following Is NOT considered a conflict of Interest that Is prohibited under the ACFE Code of Professional Ethics?
- A. Undertaking an engagement that decreases the fraud examiner's ability to perform their duties for their full-time employer
- B. Undertaking engagements for both sides in a case of an alleged product substitution scheme
- C. Accepting an assignment to secretly infiltrate the fraud examiner's employing organization and transmit inside information to another party
- D. 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
Answer: D
NEW QUESTION # 20
The theory of differential association is used frequently lo explain white-collar criminality. Which of the following is NOT one of the assertions or principles of differential association?
- A. Criminal behavior is explained by an individual's general needs and values.
- B. Criminal behavior is acquired through participation with intimate personal groups.
- C. Criminal behavior is learned using the same mechanisms as other learning
- D. Criminal behavior is learned from other people in a process of communication.
Answer: A
NEW QUESTION # 21
Which of the following statements regarding white-collar defendants is TRUE?
- A. They are more likely to be fined than to face prison terms as punishment
- B. They are less likely to insist on a trial than other offenders
- C. All of the above
- D. The lower the offenders' social status, the more likely they are to be imprisoned
Answer: A
NEW QUESTION # 22
The Committee of Sponsoring Organizations of the Treadway Commission (COSO) defines_____________as
"a process, effected by an entity s board of directors management.
and other personnel designed to provide reasonable assurance regarding the achievement of objectives relating to operations, reporting, and compliance."
- A. Risk assessment
- B. Corporate compliance
- C. Internal control
- D. Fraud risk management
Answer: C
NEW QUESTION # 23
During an external audit, the audit team identifies evidence that management has intentionally omitted some expenses from the company's financial statements in order to conceal an asset misappropriation scheme. However, the amount of the resulting misstatement does not meet the quantitative materiality threshold for the audit. Which of the following is TRUE regarding this situation?
- A. The auditors can ignore the misstatement because the omitted amount is less than the quantitative materiality threshold and therefore immaterial to the audit.
- B. The auditors should assume that all audit evidence collected previously is unreliable and withdraw from the audit engagement
- C. The auditors should assess the need to adjust the nature, timing, and extent of remaining audit procedures based on this evidence.
- D. The auditors do not need to be concerned with this evidence, as asset misappropriation schemes are not considered relevant or material for external audit purposes.
Answer: A
NEW QUESTION # 24
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 report her findings to the audit committee of the board of directors.
- B. Susannah should Immediately report her findings to the secunties regulators
- C. Susannah should not disclose her findings to any other parties due to client confidentiality.
- D. Susannah should confront management with her audit findings and try to get a confession.
Answer: A
NEW QUESTION # 25
Management at ABC Corp. is assessing the company's ethical tone and how it affects the organization's fraud risk. To most effectively reinforce an anti-fraud culture, management should:
- A. Create an environment in which employees feel safe challenging management's decisions
- B. implement two separate sets of ethics policies, one for management and one for employees
- C. All of the above
- D. Use a checklist of initiatives to make sure all the elements of a strong tone at the top are in place
Answer: A
NEW QUESTION # 26
Blue. Inc. is a specialty retailer of customized shipping containers. The company receives a very large order from Green Company, a new customer from a country that is known to have high corruption risks. Which of the following is MOST ACCURATE regarding the due diligence procedures Blue should perform on Green before proceeding with this transaction?
- A. Blue should consider Green's expected purchasing pattern and method of payment in determining whether to accept the transaction.
- B. Blue should perform the same level of due diligence as it would for any other customer to avoid claims of discrimination.
- C. Blue only needs to undertake due diligence procedures if Green is requesting to pay on credit.
- D. Blue does not need to undertake any specific due diligence procedures for this transaction.
Answer: A
NEW QUESTION # 27
Which of the following is TRUE regarding the communication of the fraud risk assessment process?
- A. The communication should be made in a format mat is most appropriate for the culture of the organization
- B. The more personalized the communication, the more effective it will be in encouraging employees to participate
- C. The communication should be visibly disseminated throughout the business
- D. All of the above
Answer: D
NEW QUESTION # 28
XYZ. Inc. is a publicly traded, multi-national corporation. Which of the following statements is TRUE regarding the corporate governance requirements that XYZ is subject to?
- A. XYZ is subject to the Universal Corporate Governance Act because it is a publicly traded corporation.
- B. XYZ must comply with the various laws and regulations in the countries in which it operates
- C. XYZ is required to comply with G20'OECD Principles of Corporate Governance.
- D. XYZ is not required to comply with any corporate governance requirements because it operates in multiple jurisdictions
Answer: B
NEW QUESTION # 29
In identifying the inherent fraud risks that could apply to the organization, the fraud risk assessment team should discuss:
- A. The possibility of management's override of controls
- B. Risks to the organization's reputation
- C. The organization's incentive programs
- D. All of the above
Answer: D
NEW QUESTION # 30
Patrick is conducting an external audit of a company in a jurisdiction that is subject to International Standards on Auditing (ISAs). While undertaking his audit procedures, he discovers evidence that senior management has been fraudulently manipulating the financial statements. Which of the following is Patrick's BEST response to these findings?
- A. Patrick should immediately report his findings to local law enforcement authorities.
- B. Patrick should confront management with his audit findings and try to get a confession.
- C. Patrick should report his findings to those charged with governance of the organization.
- D. Patrick should not disclose his findings to any other parties due to client confidentiality
Answer: C
NEW QUESTION # 31
The findings in the 2020 Report to the Nations include which of the following?
- A. Mote occupational frauds are committed by men than by women
- B. The majority of fraudsters have been previously punished by an employer for a fraud-related offense
- C. The most commonly reported red flag displayed by fraud perpetrators prior to the detection of their crime is complaints about management.
- D. The median losses caused by executives are lower than those caused by staff-level employees
Answer: A
NEW QUESTION # 32
Jody has been working at ABC Corp. for ten years. He steals funds from the company and tells himself that the company owes it to him for his "unrewarded hard work and loyalty" This situation BEST illustrates which leg of the Fraud Triangle?
- A. Perceived opportunity
- B. Rationalization
- C. Lack of personal Integrity
- D. Perceived non-shareable financial need
Answer: B
NEW QUESTION # 33
Which of the following statements is TRUE regarding how fraud examiners should exercise professional skepticism during a fraud examination engagement?
- A. Professional skepticism means beginning all assignments with the belief that something is amiss.
- B. Professional skepticism involves maintaining a mindset that no fraud has occurred
- C. Fraud examiners should form the engagement hypothesis without regard to the available preliminary information.
- D. Fraud examiners should not relax their skeptical attitudes under any circumstances.
Answer: D
NEW QUESTION # 34
In the context of fraud examination, integrity requires all of the following EXCEPT:
- A. An ability to analyze situations where no professional rules are specifically applicable and determine right from wrong
- B. Avoidance of differences of opinion
- C. Subordination of desires for personal gain to the interests of clients, employers, and the public
- D. Independence of mental attitude
Answer: B
NEW QUESTION # 35
Which of the following is FALSE regarding proactive fraud auditing procedures?
- A. Fraud assessment questioning techniques are most appropriately used as part of the normal audit process
- B. Analytical review of the financial statements is best used to uncover small frauds that might be missed by other detection methods
- C. Implementing proactive fraud audit procedures demonstrates management's intention to aggressively seek out possible fraudulent conduct
- D. Fraud audit procedures should be designed to incorporate an element of surprise.
Answer: B
NEW QUESTION # 36
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