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Certified Fraud Examiner Dumps CFE-Fraud-Prevention-and-Deterrence Exam for Full Questions - Exam Study Guide
NEW QUESTION 74
A corporation can generally be held criminally responsible for criminal acts committed by its employees even if those in management had no knowledge of or participation in the underlying events.
- A. True
- B. False
Answer: A
NEW QUESTION 75
Which of the following is among the board of directors' primary responsibilities related to fraud risk management?
- A. Overseeing the organization's fraud risk management activities
- B. Punishing fraud perpetrators discovered through fraud risk management activities
- C. Designing the fraud risk management program
- D. Implementing the fraud risk management program
Answer: A
NEW QUESTION 76
To be in compliance with the ACFE Code of Professional Ethics, fraud examiners must have:
- A. A Sufficient skill and knowledge to recognize when additional training or expert guidance is required
- B. An expert level of experience for every circumstance that might be encountered in a fraud examination
- C. Sufficient resources to obtain the training needed to become an expert on all facets of fraud examinations
- D. An expert level of knowledge for every circumstance that might be encountered in a fraud examination
Answer: C
NEW QUESTION 77
Which of the following is one of the recommendations made by the National Commission on Fraudulent Financial Reporting (the Treadway Commission) to reduce the probability of fraud in financial reports?
- A. A written charter for management
- B. A mandatory independent compensation committee
- C. Adequate audit committee resources and authority
- D. Shareholder oversight of internal controls
Answer: C
NEW QUESTION 78
Which principle of corporate governance pertains to the disclosure of all material matters that the shareholders need to make timely and informed decisions regarding their investment in the company?
- A. Transparency
- B. Fairness
- C. Accountability
- D. Responsibility
Answer: A
NEW QUESTION 79
Which of the following statements regarding best practices that organizations can take to protect and support whistleblowers is MOST ACCURATE?
- A. Organizations should establish formal consequences that are to be imposed upon employees at the company who retaliate against a whistleblower.
- B. Organizations should emphasize that rules regarding whistleblower protections are only intended for lower level employees who might be more vulnerable to retaliation.
- C. Organizations should implement a clear whistleblower policy that lists out every type of misconduct that has ever been reported at the company.
- D. Organizations should publicize their whistleblower procedures internally but should avoid communicating any procedural information to parties outside of the organization.
Answer: A
NEW QUESTION 80
Which of the following is NOT a responsibility of the organization's board of directors?
- A. Directing employees to execute business activities
- B. Acting as guardians of the organization's resources and assets
- C. Assessing the strategy and underlying purpose of management's decisions and actions
- D. Serving as the intermediaries between shareholders and management
Answer: A
NEW QUESTION 81
Which of the following is FALSE regarding corporate governance'
- A. Effective corporate governance practices are most necessary in an organization in which the owners are not also the individuals responsible for setting and executing the business strategy
- B. Effective corporate governance practices are considered to be the foundation of fraud risk management.
- C. Corporate governances primary purpose is to ensure the accuracy of the organizations financial reports
- D. An entity's corporate governance structure specifies the distribution of rights and responsibilities among the different participants in the organization
Answer: A
NEW QUESTION 82
Which of the following Is one of the components of the Committee of Sponsoring Organizations of the Treadway Commission's (COSO) Enterprise Risk Management-Integrating with Strategy and Performance?
- A. Operating environment
- B. Independent monitoring
- C. Governance and culture
- D. Risk tolerance
Answer: B
NEW QUESTION 83
Employees should be kept unaware that management is watching for lifestyle and behavior changes In staff members that might indicate fraud.
- A. True
- B. False
Answer: A
NEW QUESTION 84
Which of the following Is one of the recommendations made by the National Commission on Fraudulent Financial Reporting (the Treadway Commission) to reduce the probability of fraud in financial reports?
- A. Give shareholders oversight of hotline reporting programs
- B. Develop a written charter for management
- C. Have a mandatory independent audit committee
- D. Have adequate compensation committee resources and authority
Answer: C
NEW QUESTION 85
Maria conducted a fraud examination that led to a valid confession of guilt from Rita. In Maria's verbal report to her superiors, she stated that, in her opinion. "Rita is guilty of embezzlement." Maria has just violated the ACFE Code of Professional Ethics.
- A. True
- B. False
Answer: B
NEW QUESTION 86
According to International Auditing Standard (ISA) 240. the two types of intentional financial statement misstatements that are relevant to the auditor are
- A. Misstatements resulting from fraudulent financial reporting and misstatements resulting from misappropriation of assets
- B. Immaterial misstatements and material misstatements
- C. Misstatements affecting the income statement and misstatements affecting the balance sheet
- D. Misstatements resulting from revenue manipulation and misstatements resulting from expense manipulation
Answer: C
NEW QUESTION 87
Gregory, an internal auditor, and Brandon, the company's purchasing manager, have had several heated disagreements over purchasing procedures and policies. Gregory has just been told that he will be the lead on the company's fraud risk assessment. During the fraud risk assessment. Gregory should:
- A. Automatically designate the purchasing function as a high-risk area.
- B. Confront Brandon about the disagreements and discuss how they increase the organization's risk of fraud-
- C. Include his disagreements with Brandon as a factor when assessing the risk of fraud in the purchasing function.
- D. Have someone else perform the fraud risk assessment work related to the purchasing function
Answer: C
NEW QUESTION 88
During an external audit of an organization's financial statements. Peter, the external auditor, uncovers significant internal control deficiencies at the audit client's organization. He believes these deficiencies could result in a material misstatement of the financial statements. Which of the following should Peter do with regard to these findings?
- A. Peter should discreetly work with senior management to correct the underlying internal control deficiencies.
- B. Peter should provide a written communication about the findings to those charged with governance.
- C. Peter should report the findings in writing directly to the appropriate regulatory agencies
- D. Peter should make a public announcement that he is withdrawing from the audit engagement.
Answer: B
NEW QUESTION 89
Which of the following is FALSE regarding a background check policy for employees'7
- A. When verifying past employment, management should only ask previous employers to verify the dates the candidate was employed.
- B. As part of the screening process, management should contact the references provided by the job candidate
- C. Where permitted by law. management should run a background check on any existing employee who is being promoted to a position that includes access to sensitive or valuable company resources, even if a background check was run on the individual at the time of hire
- D. At a minimum, management should conduct a background check on any candidate who will have constant access to cash, checks, and credit card numbers, or other easily stolen items.
Answer: A
NEW QUESTION 90
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