Introduction to Forensic Accounting Chapter 1 Quiz |100% Correct Answers|

Introduction to Forensic Accounting Chapter 1 Quiz |100% Correct Answers| What are the key the key elements of the definition of forensic accounting? *Ans* Accounting, special skills, law, evidential matter and interpret and communicate What does the word forensic mean? *Ans* Pertaining to law What are the two areas into which the practice of forensic accounting is typically divided? *Ans* Litigation Services and Investigative Services How does auditing differ from forensic accounting? *Ans* Auditing and forensic accounting are governed by different standards. Auditing is subject to attestation standards and auditing standards promoted by the AICPA. Forensic accounting is subject to the Statement on Standards for Consulting Services. Overall objective of the engagements are different i.e. - work product. Work product is different. Auditors will issue an opinion on the fair presentation of financial statements in relation to the applicable accounting framework. A forensic accountants apply specialized skills that differ from those used by auditors. And the work product will depend on the issues at hand and will vary by engagement. By whom and when was the term forensic accounting coined *Ans* Person: Maurice Peloubet Date: 1946 Published an article titled "Forensic Accounting - Its Place in Today's Economy" What are some of the knowledge and skills required in forensic accounting? (name at least 4) *Ans* IT, criminology, psychology, accounting, problem solving, risk analysis, accounting information systems, auditing, legal, investigative and digital forensics What are two examples of financial cases that require investigation *Ans* Occupational fraud, determining the value of a spouse's assets in a divorce case, investigating public corruption, tracing the sources of funds in a terrorism case, determining the extent of money laundering in narcotics trafficking cases What is the difference between fact witnesses and expert witnesses *Ans* Fact witnesses can only testify as to what they have directly perceived through their senses (i.e. touch, hearing, sight and smell). Expert witnesses can provide opinions on relevant issues What are the three management activities associated with fraud risk management *Ans* Prevention, detection and response What special skills and knowledge are required to conduct a forensic accounting investigation (at least 3) *Ans* How to structure and manage investigations, the types of evidence that may be collected, how to maintain the chain of custody, the legal rights of those under investigation, how to identify different types of fraud schemes, how to conduct interviews and how to detect deception Are communication skills critical in forensic accounting? Why or why not *Ans* Yes. Forensic accountants may have to produce written or oral reports on their findings, which may used in court to assist the trier of fact. These reports will be subject to scrutiny on direct and cross examination. The forensic accountant must have good communication skills to present and defend their findings. What are two areas in which forensic accountants, as experts consultants, can give advice *Ans* Mergers and acquisitions, fraud risk mitigation, internal dispute resolution systems, the value of an estate, financial impact of bankruptcie