WGU D551 - FRAUD & FORENSIC
ACCOUNTING PRACTICE EXAMINATION
2026 QUESTIONS WITH ANSWERS
GRADED A+
◍ Section 201.
Answer: Prohibits certain services by auditors to clients.
◍ Fraud Examination Methodology.
Answer: Uniform legal approach to resolving fraud cases.
◍ Marital Privileges.
Answer: Spousal immunity from testifying against spouse.
◍ Perceived opportunity.
Answer: General information-- knowledge that the employees position of
trust could be violated, Technical skill-- abilities needed to commit the
violation
◍ What is playing the accounting system?.
Answer: The fraudster uses the accounting system as a tool to generate the
results he wants.
◍ Parole.
Answer: Release from prison as reward for good behavior.
◍ Chain of Custody.
Answer: Tracking possession and handling of evidence.
◍ What instance recorded by the internal controls team of a company indicates
a fraudulent activity?1. A warehouse employee ships products to a
P. O. Box & then sells them online.2. An employee from the finance dept.
, recorded inventory at its net present value, which was lower than its original
cost, in the company's balance sheet.3. An accounts manager attends to
personal business during work hours.4. An employee from the accounting
dept. uses a work laptop to invest in the stock market..
Answer: 1. A warehouse employee ships products to a P.O. Box & then sells
them online.
◍ While auditing a tech company's financial records, Nora spots some entries
made by the CF
O. In almost all such cases, the entries are recorded at odd hours. These
entries are unusual because such entries are generally made by a clerical
employee during regular business hours. Which type of early sign of fraud
or red flag is this?1-Lifestyle symptom2-Analytical anomaly3-Behavioral
symptom4-Accounting anomaly.
Answer: 4-Accounting anomaly
◍ Off-site employees.
Answer: Rent apartments with no lease signed, take cashTenants who pay
currency are not on books
◍ Forensic Accounting.
Answer: Intersection of accounting and legal principles.
◍ Surveillance Legality.
Answer: Generally legal, not by fraud examiners.
◍ Preventing and detecting larceny of noncash assets.
Answer: Segregation of duties Separate custody, recording, and
approvalPhysical controls and locks on merchandiseSecurity
camerasPhysical inventory counts
◍ Occupational fraud and abuse.
Answer: the use of ones occupation for personal enrichment through the
deliberate misuse or misapplication of the employing organizations
resources or assets
◍ A company is looking to strengthen its controls against financial fraud after
, noticing inflated invoices from a particular vendor. Investigators reveal that
the vendor was collaborating with a senior purchasing agent, resulting in the
company being overcharged & a portion of the inflated amount being kicked
backed to the agent. Which preventive measure will be effective in directly
mitigating such kickback schemes int he future?1-Assigning the duties of
purchasing, receiving, & storing goods to different employees.2-Holding
annual financial fraud awareness seminars for all employees.3-Ensuring
multiple people are involved in decision-making during the competitive
bidding process.4-Rotating job responsibilities of employees in the
procurement department..
Answer: 3-Ensuring multiple people are involved in decision-making during
the competitive bidding process.
◍ Probable Cause.
Answer: Standard for arrests and search warrants.
◍ Independent businessman rationalizations.
Answer: Borrowing money, Funds entrusted to them were really theirs,
Everyone in business steals money
◍ deposits in transit.
Answer: Carry missing money as deposits in transit
◍ Norah is an office cash manager at the local grocery store. She often logs
into the cash registers of checkout employees when they are on break, rings
a no-sale transaction, & steals cash from the register. Which type of cash
larceny is this?.
Answer: Thefts from other registers
◍ Termination Documentation.
Answer: Employers must document good cause for termination.
◍ Cash larceny from the deposit.
Answer: Normally someone tabulates receipts. Lists form of payment,
prepare deposit slip then another employee takes the cash and deposits to
bank
, ◍ How might a company attempt to prevent conflicts of interest?1-Require
employees to complete an annual financial disclosure statement2-Establish
an anonymous reporting mechanism to receive tips & complaints3-Compare
vendor & employee addresses4-Complete a name search with public state
records.
Answer: 1-Require employees to complete an annual financial disclosure
statement
◍ Grand jury proceeding.
Answer: Legal process resulting in indictment and arrest warrant.
◍ Categories of non-shareable problems.
Answer: Violation of ascribed obligations, Problems resulting from personal
failure, Business reversals, Physical isolation, Status gaining,
Employer-employee relations
◍ Hypothesis-Evidence Matrix.
Answer: Tool for analyzing competing fraud hypotheses.
◍ Which method of generating fraudulent financials involves producing
whatever financials are desired by using a personal computers & a
printer?1-Removing the accounting system2-Beating the accounting
system3-Playing the accounting system4-Going outside the accounting
system.
Answer: 4-Going outside the accounting system
◍ Interrogatories.
Answer: Written questions requiring answers for testimonial record.
◍ Altered inventory records.
Answer: Change perpetual inventory record so that it matches inventory
count Or change physical inventory record to match perpetual inventory
◍ A company purchased new machinery for $450,000. By the end of the fiscal
year, the net realizable value (NRV) was $380,000. Company reported it at
NRV instead of cost so that return on asset is as per the industry average.
ACCOUNTING PRACTICE EXAMINATION
2026 QUESTIONS WITH ANSWERS
GRADED A+
◍ Section 201.
Answer: Prohibits certain services by auditors to clients.
◍ Fraud Examination Methodology.
Answer: Uniform legal approach to resolving fraud cases.
◍ Marital Privileges.
Answer: Spousal immunity from testifying against spouse.
◍ Perceived opportunity.
Answer: General information-- knowledge that the employees position of
trust could be violated, Technical skill-- abilities needed to commit the
violation
◍ What is playing the accounting system?.
Answer: The fraudster uses the accounting system as a tool to generate the
results he wants.
◍ Parole.
Answer: Release from prison as reward for good behavior.
◍ Chain of Custody.
Answer: Tracking possession and handling of evidence.
◍ What instance recorded by the internal controls team of a company indicates
a fraudulent activity?1. A warehouse employee ships products to a
P. O. Box & then sells them online.2. An employee from the finance dept.
, recorded inventory at its net present value, which was lower than its original
cost, in the company's balance sheet.3. An accounts manager attends to
personal business during work hours.4. An employee from the accounting
dept. uses a work laptop to invest in the stock market..
Answer: 1. A warehouse employee ships products to a P.O. Box & then sells
them online.
◍ While auditing a tech company's financial records, Nora spots some entries
made by the CF
O. In almost all such cases, the entries are recorded at odd hours. These
entries are unusual because such entries are generally made by a clerical
employee during regular business hours. Which type of early sign of fraud
or red flag is this?1-Lifestyle symptom2-Analytical anomaly3-Behavioral
symptom4-Accounting anomaly.
Answer: 4-Accounting anomaly
◍ Off-site employees.
Answer: Rent apartments with no lease signed, take cashTenants who pay
currency are not on books
◍ Forensic Accounting.
Answer: Intersection of accounting and legal principles.
◍ Surveillance Legality.
Answer: Generally legal, not by fraud examiners.
◍ Preventing and detecting larceny of noncash assets.
Answer: Segregation of duties Separate custody, recording, and
approvalPhysical controls and locks on merchandiseSecurity
camerasPhysical inventory counts
◍ Occupational fraud and abuse.
Answer: the use of ones occupation for personal enrichment through the
deliberate misuse or misapplication of the employing organizations
resources or assets
◍ A company is looking to strengthen its controls against financial fraud after
, noticing inflated invoices from a particular vendor. Investigators reveal that
the vendor was collaborating with a senior purchasing agent, resulting in the
company being overcharged & a portion of the inflated amount being kicked
backed to the agent. Which preventive measure will be effective in directly
mitigating such kickback schemes int he future?1-Assigning the duties of
purchasing, receiving, & storing goods to different employees.2-Holding
annual financial fraud awareness seminars for all employees.3-Ensuring
multiple people are involved in decision-making during the competitive
bidding process.4-Rotating job responsibilities of employees in the
procurement department..
Answer: 3-Ensuring multiple people are involved in decision-making during
the competitive bidding process.
◍ Probable Cause.
Answer: Standard for arrests and search warrants.
◍ Independent businessman rationalizations.
Answer: Borrowing money, Funds entrusted to them were really theirs,
Everyone in business steals money
◍ deposits in transit.
Answer: Carry missing money as deposits in transit
◍ Norah is an office cash manager at the local grocery store. She often logs
into the cash registers of checkout employees when they are on break, rings
a no-sale transaction, & steals cash from the register. Which type of cash
larceny is this?.
Answer: Thefts from other registers
◍ Termination Documentation.
Answer: Employers must document good cause for termination.
◍ Cash larceny from the deposit.
Answer: Normally someone tabulates receipts. Lists form of payment,
prepare deposit slip then another employee takes the cash and deposits to
bank
, ◍ How might a company attempt to prevent conflicts of interest?1-Require
employees to complete an annual financial disclosure statement2-Establish
an anonymous reporting mechanism to receive tips & complaints3-Compare
vendor & employee addresses4-Complete a name search with public state
records.
Answer: 1-Require employees to complete an annual financial disclosure
statement
◍ Grand jury proceeding.
Answer: Legal process resulting in indictment and arrest warrant.
◍ Categories of non-shareable problems.
Answer: Violation of ascribed obligations, Problems resulting from personal
failure, Business reversals, Physical isolation, Status gaining,
Employer-employee relations
◍ Hypothesis-Evidence Matrix.
Answer: Tool for analyzing competing fraud hypotheses.
◍ Which method of generating fraudulent financials involves producing
whatever financials are desired by using a personal computers & a
printer?1-Removing the accounting system2-Beating the accounting
system3-Playing the accounting system4-Going outside the accounting
system.
Answer: 4-Going outside the accounting system
◍ Interrogatories.
Answer: Written questions requiring answers for testimonial record.
◍ Altered inventory records.
Answer: Change perpetual inventory record so that it matches inventory
count Or change physical inventory record to match perpetual inventory
◍ A company purchased new machinery for $450,000. By the end of the fiscal
year, the net realizable value (NRV) was $380,000. Company reported it at
NRV instead of cost so that return on asset is as per the industry average.
