ACCT 450 MIDTERM EXAM UPDATED QUESTIONS AND ANSWERS
What four groups experience costs when fraud occurs? - CORRECT ANSWER✅✅Government Agencies,
Researchers, Insurance Companies, and Victims of Fraud
What is the world's largest anti-fraud organization? - CORRECT ANSWER✅✅The Association of Certified
Fraud Examiners (ACFE)
What percentage of an organization's revenue goes to fraud each year? - CORRECT
ANSWER✅✅Roughly 5%
What is the best way to minimize fraud? - CORRECT ANSWER✅✅Prevent it from occurring
What is fraud? - CORRECT ANSWER✅✅Fraud is a deception that includes the following: a
representation, about a material point, which is false, and intentionally or reckless, which is believed,
and acted upon by a victim, and is to the victim's damage.
What are the two types of fraud? - CORRECT ANSWER✅✅1. Fraud that is committed against an
organization. 2. Fraud that is committed on behalf of an organization.
What are the three major categories of occupational fraud? - CORRECT ANSWER✅✅1. Asset
Misappropriation 2. Corruption 3. Fraudulent Financial Statements
What is organization fraud? - CORRECT ANSWER✅✅Frauds where a company or organization is the
victim.
What is vendor fraud? - CORRECT ANSWER✅✅Perpetrator is a vendor of the organization.
What is customer fraud? - CORRECT ANSWER✅✅Perpetrator is a customer of the organization.
What is management fraud? - CORRECT ANSWER✅✅Victims are shareholders or debt-holders of the
organization.
, What are investment scams and other consumer frauds? - CORRECT ANSWER✅✅Victims are unwary
individuals.
What are miscellaneous frauds? - CORRECT ANSWER✅✅Any other type of fraud?
What is the most common type of occupational fraud? - CORRECT ANSWER✅✅Employee
Embezzlement
What is employee embezzlement? - CORRECT ANSWER✅✅Employee embezzlement is the deception of
an employer by taking their assets. This can be done directly by stealing cash, inventory, tools, etc. or
indirectly by taking bribes, kickbacks, nondelivered of goods, etc.
What are the two types of vendor fraud? - CORRECT ANSWER✅✅1. Fraud perpetrated by vendors
acting alone. 2. Fraud perpetrated through collusion between buyers and vendors.
What does management fraud commonly involve? - CORRECT ANSWER✅✅Management involves top
management's deceptive manipulation of financial statements.
What do investment scams and other consumer frauds include? - CORRECT ANSWER✅✅Investment
scams and other consumer frauds include fraudulent and usually worthless investments are sold to
unsuspecting investors. Telemarketing fraud falls into this category.
What are the most common consumer fraud schemes? - CORRECT ANSWER✅✅Ponzi Schemes,
Pyramid Schemes, Telemarketing Fraud, Nigerian Letter or Money Scams, Identity theft, Advance Fee
Scams, Redemption/Strawman/Bond Fraud, Letter of Credit Fraud, Internet Fraud.
What is the burden of proof in a court of criminal law. - CORRECT ANSWER✅✅Burden of Proof
What is the difference between a criminal and a civil jury. - CORRECT ANSWER✅✅A criminal jury must
make a unanimous decision, and a civil jury does not need be a unanimous decision.
What four groups experience costs when fraud occurs? - CORRECT ANSWER✅✅Government Agencies,
Researchers, Insurance Companies, and Victims of Fraud
What is the world's largest anti-fraud organization? - CORRECT ANSWER✅✅The Association of Certified
Fraud Examiners (ACFE)
What percentage of an organization's revenue goes to fraud each year? - CORRECT
ANSWER✅✅Roughly 5%
What is the best way to minimize fraud? - CORRECT ANSWER✅✅Prevent it from occurring
What is fraud? - CORRECT ANSWER✅✅Fraud is a deception that includes the following: a
representation, about a material point, which is false, and intentionally or reckless, which is believed,
and acted upon by a victim, and is to the victim's damage.
What are the two types of fraud? - CORRECT ANSWER✅✅1. Fraud that is committed against an
organization. 2. Fraud that is committed on behalf of an organization.
What are the three major categories of occupational fraud? - CORRECT ANSWER✅✅1. Asset
Misappropriation 2. Corruption 3. Fraudulent Financial Statements
What is organization fraud? - CORRECT ANSWER✅✅Frauds where a company or organization is the
victim.
What is vendor fraud? - CORRECT ANSWER✅✅Perpetrator is a vendor of the organization.
What is customer fraud? - CORRECT ANSWER✅✅Perpetrator is a customer of the organization.
What is management fraud? - CORRECT ANSWER✅✅Victims are shareholders or debt-holders of the
organization.
, What are investment scams and other consumer frauds? - CORRECT ANSWER✅✅Victims are unwary
individuals.
What are miscellaneous frauds? - CORRECT ANSWER✅✅Any other type of fraud?
What is the most common type of occupational fraud? - CORRECT ANSWER✅✅Employee
Embezzlement
What is employee embezzlement? - CORRECT ANSWER✅✅Employee embezzlement is the deception of
an employer by taking their assets. This can be done directly by stealing cash, inventory, tools, etc. or
indirectly by taking bribes, kickbacks, nondelivered of goods, etc.
What are the two types of vendor fraud? - CORRECT ANSWER✅✅1. Fraud perpetrated by vendors
acting alone. 2. Fraud perpetrated through collusion between buyers and vendors.
What does management fraud commonly involve? - CORRECT ANSWER✅✅Management involves top
management's deceptive manipulation of financial statements.
What do investment scams and other consumer frauds include? - CORRECT ANSWER✅✅Investment
scams and other consumer frauds include fraudulent and usually worthless investments are sold to
unsuspecting investors. Telemarketing fraud falls into this category.
What are the most common consumer fraud schemes? - CORRECT ANSWER✅✅Ponzi Schemes,
Pyramid Schemes, Telemarketing Fraud, Nigerian Letter or Money Scams, Identity theft, Advance Fee
Scams, Redemption/Strawman/Bond Fraud, Letter of Credit Fraud, Internet Fraud.
What is the burden of proof in a court of criminal law. - CORRECT ANSWER✅✅Burden of Proof
What is the difference between a criminal and a civil jury. - CORRECT ANSWER✅✅A criminal jury must
make a unanimous decision, and a civil jury does not need be a unanimous decision.
