WGU D550 ETHICS FOR ACCOUNTANTS REVIEW | 174
ACTUAL QUESTIONS AND ANSWERS | 2025/2026
UPDATE | RATED 100% CORRECT!!
a deliberate misrepresentation to gain an advantage over another party (or
have them do something they might not ordinarily do) Answer - Fraud
What are the different forms of fraud? Answer - Fraud in the FS, the
misappropriation of assets (theft) and subsequent cover up, and disclosure
fraud
when an employee steals or misuses resources, such as charging personal
expenses to the company card while traveling on business trips Answer - Asset
Misappropriatiion Schemes
include misusing one's position or influence in an organization for personal gain
Answer - Corruption Schemes
What was the most common detection method reported in 2016 ACFE survey?
Answer - a tip (43% reported)
What was the most common disciplinary method taken in occupational fraud
cases was? Answer - termination (66%)
,Fraud red flags include: Answer - - living beyond means (42%)
- financial difficulties (26%)
- unusually close association with vendor/customer
- control issues, unwillingness to share duties
- no behavioral red flags
- "wheeler-dealer" attitude
- irritability, suspiciousness, or defensiveness
- divorce/family problems
- addiction problems
- complained about inadequate pay
- excessve pressure from within the org
- refusal to take vacations
- past employment-related problems
- social isolation
- past legal problems
- complained about lack of authority
- excessive family/peer pressure for success
- other
- instability in life circumstances
found that payroll schemes accounted for 9% of the asset misappropriations,
had a median cost of $62,000, and lasted a median of 2 years before being
detected Answer - ACFE Study
Factors that discourage the reporting of fraud according to report from anit-
fraud collaboration include: Answer - - poor tone at the top
,- dominating and intimidating personalities
- mistrust
- excessive team loyalty
- management doesnt want to hear about problems
- a lack of sound policies and procedures
- the perception that wrongdoing will not be addressed if misconduct is
reported
Factors that discourage employees from coming forward include: Answer - -
fear of the unknown
- fear that the report will not be handled anonymously or confidentially
- fear that the reporters identity will be revealed to other in the organization
- concern that the person perpetrating the misconduct will not be held
responsible
What are the potential consequences for reporting suspected fraud? Answer -
- retaliation by coworkers
- termination
- future reputation
- impact on others
- results of investigation determine that the misconduct unsustainable
- emotional cost
occurs when an employee, typically a member of top management, causes a
misstatement or omission of material in the organization's financial reports
Answer - FS Fraud
, What are some examples of FS fraud? Answer - recording ficticious revenues,
understating reported expenses, artificially inflating reported assets, failing to
accrue expenses at the end of the year, and accelerating the recording of
revenue into an earlier period (timing differences)
What are the elements of the fraud triangle that explain why FS fraud occurs?
Answer - situational pressure, perceived opportunity, and rationalization
What does the organizations culture represent? Answer - "how we do things
around here"
What does the ethical culture represent? Answer - "how we do things around
here in relation to ethics and ethical behavior in the organization"
"occurs when any organization has drifted from the basic principles of right and
wrong" Answer - Ethical Collapse (according to Marianne Jennings)
Who wrote "The 7 signs of Ethical Collapse"? Answer - Marianne Jennings
What are the 7 signs of ethical collapse? Answer - 1) pressure to maintain
numbers
2) fear and silence
3) young'uns and a bigger than life CEO (loyalty to the boss)
4) weak board of directors
5) conflicts of interest overlooked or unaddresses
6) innovation like no other company (sometimes too much)
7) goodness in the some areas atones for evil in others
ACTUAL QUESTIONS AND ANSWERS | 2025/2026
UPDATE | RATED 100% CORRECT!!
a deliberate misrepresentation to gain an advantage over another party (or
have them do something they might not ordinarily do) Answer - Fraud
What are the different forms of fraud? Answer - Fraud in the FS, the
misappropriation of assets (theft) and subsequent cover up, and disclosure
fraud
when an employee steals or misuses resources, such as charging personal
expenses to the company card while traveling on business trips Answer - Asset
Misappropriatiion Schemes
include misusing one's position or influence in an organization for personal gain
Answer - Corruption Schemes
What was the most common detection method reported in 2016 ACFE survey?
Answer - a tip (43% reported)
What was the most common disciplinary method taken in occupational fraud
cases was? Answer - termination (66%)
,Fraud red flags include: Answer - - living beyond means (42%)
- financial difficulties (26%)
- unusually close association with vendor/customer
- control issues, unwillingness to share duties
- no behavioral red flags
- "wheeler-dealer" attitude
- irritability, suspiciousness, or defensiveness
- divorce/family problems
- addiction problems
- complained about inadequate pay
- excessve pressure from within the org
- refusal to take vacations
- past employment-related problems
- social isolation
- past legal problems
- complained about lack of authority
- excessive family/peer pressure for success
- other
- instability in life circumstances
found that payroll schemes accounted for 9% of the asset misappropriations,
had a median cost of $62,000, and lasted a median of 2 years before being
detected Answer - ACFE Study
Factors that discourage the reporting of fraud according to report from anit-
fraud collaboration include: Answer - - poor tone at the top
,- dominating and intimidating personalities
- mistrust
- excessive team loyalty
- management doesnt want to hear about problems
- a lack of sound policies and procedures
- the perception that wrongdoing will not be addressed if misconduct is
reported
Factors that discourage employees from coming forward include: Answer - -
fear of the unknown
- fear that the report will not be handled anonymously or confidentially
- fear that the reporters identity will be revealed to other in the organization
- concern that the person perpetrating the misconduct will not be held
responsible
What are the potential consequences for reporting suspected fraud? Answer -
- retaliation by coworkers
- termination
- future reputation
- impact on others
- results of investigation determine that the misconduct unsustainable
- emotional cost
occurs when an employee, typically a member of top management, causes a
misstatement or omission of material in the organization's financial reports
Answer - FS Fraud
, What are some examples of FS fraud? Answer - recording ficticious revenues,
understating reported expenses, artificially inflating reported assets, failing to
accrue expenses at the end of the year, and accelerating the recording of
revenue into an earlier period (timing differences)
What are the elements of the fraud triangle that explain why FS fraud occurs?
Answer - situational pressure, perceived opportunity, and rationalization
What does the organizations culture represent? Answer - "how we do things
around here"
What does the ethical culture represent? Answer - "how we do things around
here in relation to ethics and ethical behavior in the organization"
"occurs when any organization has drifted from the basic principles of right and
wrong" Answer - Ethical Collapse (according to Marianne Jennings)
Who wrote "The 7 signs of Ethical Collapse"? Answer - Marianne Jennings
What are the 7 signs of ethical collapse? Answer - 1) pressure to maintain
numbers
2) fear and silence
3) young'uns and a bigger than life CEO (loyalty to the boss)
4) weak board of directors
5) conflicts of interest overlooked or unaddresses
6) innovation like no other company (sometimes too much)
7) goodness in the some areas atones for evil in others
