Preventing Fraud

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Question 1
Free
Multiple Choice

The default model that deals with fraud has which of the following stages

Choose correct answer/s
A

Fraud incident

B

Action

C

Resolution

D

All of the above

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Question 2
Free
Multiple Choice

The following are (is a) good control(s) for preventing fraud

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A

Physical control/proper authorization

B

Segregation of Duties

C

Independent checks

D

Documents and records

E

Both A and B

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Question 3
Free
Multiple Choice

The responsibility for preventing fraud is often seen as belonging to:

Choose correct answer/s
A

The internal auditors

B

Corporate security

C

The external auditors

D

Managers

E

Someone else

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Question 4
Free
Multiple Choice

The majority of frauds are committed by:

Choose correct answer/s
A

Someone acting alone.

B

Two or more people acting together.

C

Teenagers with long hair.

D

Investment scams.

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Question 5
Free
Multiple Choice

Most frauds are committed by

Choose correct answer/s
A

Individuals

B

Groups

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Question 6
Multiple Choice

Having a manager watch over employee's shoulders is a good example of:

Choose correct answer/s
A
Discouraging collusion
B
Monitoring employees
C
Creating an expectation of punishment
D
None of the above
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Question 7
Multiple Choice

The following elements are crucial in creating a culture of honesty except:

Choose correct answer/s
A
Hiring qualified individuals
B
Implementing employee assistance programs
C
Developing an organizational code of conduct
D
Promoting an open-door policy
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Question 8
Multiple Choice

Even with the best possible internal control system in place, its effectiveness still depends on what?

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A
Creating an expectation of punishment.
B
Identifying the nature of the risks involved and the losses that could result from these risks.
C
The competency and dependability of the people enforcing it.
D
All of the above.
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Question 9
Multiple Choice

In order to minimize fraud, a fraud-savvy organization should:

Choose correct answer/s
A
Not prosecute the fraud perpetrator to avoid publicity
B
Minimize the fraud's impact on the organization by not talking about the fraud in the organization
C
Trust its employees by reducing monitoring of employees in order to regain employee moral after fraud detection
D
Develop and promote a company code of conduct
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Question 10
True/False

True or False. Internal controls are "fraud proof".

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True
False
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Question 11
Multiple Choice

What is the most likely way to deter fraud?

Choose correct answer/s
A
Interview every employee on a regular basis
B
Implement a good system of controls
C
Keep management involved in company procedures
D
Threaten employees that perpetrators will be fired
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Question 12
Multiple Choice

Which of the following is not a red flag that a person, with a salary of $50,000 per year is living above his or her lifestyle?

Choose correct answer/s
A
A person owns several expensive cars
B
A person closely monitoring their investments
C
A person who hosts extravagant parties in their $500,000 home
D
A person who owns a multimillion dollar art collection
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Question 13
Multiple Choice

Collusion involves which of the following?

Choose correct answer/s
A
Employees working with other employees in the company
B
Employees working with others outside the company, such as vendors
C
All of the above
D
None of the above
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Question 14
Multiple Choice

The best way to limit opportunities for committing fraud in an organization is to:

Choose correct answer/s
A
Establish clear vendor policies
B
Create a tip hotline
C
Maintain good internal controls
D
Monitor employees
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Question 15
Multiple Choice

Developing and promoting a company code of conduct is one aspect of which area of a fraud-savvy organization?

Choose correct answer/s
A
Integrity and risk controls
B
Education and training
C
Tone at the top
D
Conducting Proactive auditing
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Question 16
Multiple Choice

Which of the following is not a possible fraud prevention strategy/technique?

Choose correct answer/s
A
Including "right-to-audit" clauses on purchase invoices.
B
Instigate a zero tolerance policy with regards to fraud in the workplace.
C
Effectively screen potential employees.
D
All of the above are possible fraud prevention strategies/techniques.
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Question 17
Multiple Choice

Which of the following is not a good way to eliminate opportunities for fraud?

Choose correct answer/s
A
Install good internal controls
B
Discreetly and quietly terminate employees who have been caught
C
Discourage collusion
D
Monitor employees
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Question 18
Multiple Choice

Approximately, what percentage of frauds are committed by people acting alone?

Choose correct answer/s
A
30%
B
50%
C
70%
D
90%
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Question 19
Multiple Choice

Which is not an operating condition that can contribute to a higher risk of fraud?

Choose correct answer/s
A
Management by crisis
B
Low company loyalty
C
High Morale
D
Comparatively low compensation
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Question 20
Multiple Choice

The key factors of a good internal control system includes

Choose correct answer/s
A
Accounting system including information that is valid, complete, and timely
B
Physical control of assets
C
Segregation of duties
D
All of the above
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