Forensic Accounting Exam 1 Chapters 1-6
Questions With Correct Answers
As |consultants, |which |of |the |following |services |do |forensic |accountants |not |provide?
a. |Advice |on |fraud |risk |mitigation. |
b. |Valuation |of |an |estate. |
c. |Opining |on |the |fair |presentation |of |financial |statements. |
d. |Financial |impact |of |mergers |and |acquisitions. |- |CORRECT |ANSWER✔✔-Opining |on |the |fair |
presentation |of |financial |statements.
When |performing |dispute |resolution |services, |forensic |accountants |can |serve |as |______ |or |
_______.
a. |Facilitators; |advocators.
b. |Mediators; |arbitrators.
c. |Judge; |jury.
d. |None |of |the |above. |- |CORRECT |ANSWER✔✔-Mediators; |arbitrators
Internal |fraud |schemes |typically |involve |weaknesses |in |________.
a. |Accounting.
b. |Internal |controls.
c. |Leadership.
d. |Assessment. |- |CORRECT |ANSWER✔✔-Internal |controls
Having |knowledge |in |which |of |the |following |areas |is |important |for |a |forensic |accountant?
,a. |Information |technology.
b. |Psychology.
c. |Criminology.
d. |All |of |the |above |- |CORRECT |ANSWER✔✔-All |of |the |above
The |use |of |expert |witnesses |is |primarily |to |do |which |of |the |following?
a. |Settle |disputes |out-of-court.
b. |Assist |the |trier |of |fact.
c. |Be |an |advocate |for |the |defendant |or |plaintiff.
d. |Fulfill |the |court's |obligation |of |due |diligence. |- |CORRECT |ANSWER✔✔-Assist |the |trier |of |
fact.
According |to |professional |standards, |forensic |accountants |are |engaged |only |to |assist |lawyers |
as |they |prepare |for |litigation.
a. |True.
b. |False. |- |CORRECT |ANSWER✔✔-False
To |work |effectively, |a |forensic |accountant |should |have |a |basic |understanding |of |all |of |the |
following |except:
a. |Rules |of |evidence.
b. |Law |applicable |to |conspiracy |crimes.
c. |Court |systems.
d. |Enharmonic |equivalents. |- |CORRECT |ANSWER✔✔-Enharmonic |equivalents
Whereas |traditional |accounting |has |many |subspecialties |such |as |cost |accounting, |forensic |
accounting |has |relatively |few |sub-specialties.
a. |True.
,b. |False. |- |CORRECT |ANSWER✔✔-False
Auditors |and |forensic |accountants |are |similar |in |that |they |both______.
a. |Use |the |auditing |standards |issued |by |the |AICPA |to |guide |their |work.
b. |Are |required |to |be |independent |of |their |clients.
c. |Are |allowed |to |formulate |opinions |to |assist |their |clients |and |others.
d. |Must |be |licensed |to |practice |by |the |states |in |which |they |practice. |- |CORRECT |ANSWER✔✔-
Are |allowed |to |formulate |opinions |to |assist |their |clients |and |others.
What |are |the |key |elements |of |the |definition |of |forensic |accounting? |- |CORRECT |ANSWER✔✔-
Accounting, |special |skills, |law, |evidential |matter, |interpretation |and |communication
What |does |the |word |forensic |mean? |- |CORRECT |ANSWER✔✔-Pertaining |to |law
What |are |the |two |areas |into |which |the |practice |of |forensic |accounting |is |typically |divided? |- |
CORRECT |ANSWER✔✔-Litigation |and |investigative |services
How |does |auditing |differ |from |forensic |accounting? |- |CORRECT |ANSWER✔✔-While |both |
examine |evidence |and |form |professional |judgements |on |what |they |observe, |auditors |express |
opinions |on |financial |statements |as |a |whole |and |forensic |accountants |focus |on |one |or |more |
particular |areas.
By |whom |and |when |was |the |term |forensic |accounting |coined? |- |CORRECT |ANSWER✔✔-
Maurice |Peloubet |coined |the |term |in |1946 |by |publishing |the |article |"Forensic |Accounting |- |Its |
Place |in |Today's |Economy"
What |are |some |of |the |knowledge |and |skills |required |in |forensic |accounting? |- |CORRECT |
ANSWER✔✔-Auditing, |Criminal |and |Digital |Forensics, |Accounting |Information |systems, |Risk |
analysis, |communication, |psychology, |information |technology, |problem |solving, |legal.
, What |special |skills |and |knowledge |are |required |to |conduct |forensic |accounting |investigations?
|- |CORRECT |ANSWER✔✔-Understanding |of |how |to |structure |and |manage |an |investigation.
Know |the |types |of |evidence |that |may |be |collected.
How |to |maintain |the |chain |of |custody |.
Know |the |legal |rights |of |those |under |investigation.
Know |how |to |identify |different |types |of |fraud |schemes.
Know |how |to |conduct |interviews.
Know |how |to |detect |deception.
What |are |two |areas |in |which |forensic |accountants, |as |expert |consultants, |can |give |advice? |- |
CORRECT |ANSWER✔✔-The |value |of |an |estate, |internal |dispute |resolution |systems.
What |is |the |difference |between |fact |witnesses |and |expert |witnesses? |- |CORRECT |
ANSWER✔✔-Fact |witnesses |are |only |able |to |testify |to |what |they |perceive |personally |through |
their |sense |while |expert |witnesses |are |allowed |to |give |opinions |on |relevant |issues |before |the |
trier |of |fact.
What |are |the |three |management |activities |associated |with |fraud |risk |management? |- |
CORRECT |ANSWER✔✔-Identify |fraud |risk
Prevent |fraud |schemes
Detect |fraud |schemes
Name |three |organizations |that |are |applicable |to |forensic |accountants |and |discuss |which |
factors |play |a |role |in |determining |the |organizations |to |which |forensic |accountants |belong. |- |
CORRECT |ANSWER✔✔-The |factors |that |determine |the |organization |are |education, |training, |
experience, |and |areas |of |professional |focus.
American |Society |of |Appraisers |(ASA)
Association |of |Certified |Fraud |Examiners |(ACFE)
Questions With Correct Answers
As |consultants, |which |of |the |following |services |do |forensic |accountants |not |provide?
a. |Advice |on |fraud |risk |mitigation. |
b. |Valuation |of |an |estate. |
c. |Opining |on |the |fair |presentation |of |financial |statements. |
d. |Financial |impact |of |mergers |and |acquisitions. |- |CORRECT |ANSWER✔✔-Opining |on |the |fair |
presentation |of |financial |statements.
When |performing |dispute |resolution |services, |forensic |accountants |can |serve |as |______ |or |
_______.
a. |Facilitators; |advocators.
b. |Mediators; |arbitrators.
c. |Judge; |jury.
d. |None |of |the |above. |- |CORRECT |ANSWER✔✔-Mediators; |arbitrators
Internal |fraud |schemes |typically |involve |weaknesses |in |________.
a. |Accounting.
b. |Internal |controls.
c. |Leadership.
d. |Assessment. |- |CORRECT |ANSWER✔✔-Internal |controls
Having |knowledge |in |which |of |the |following |areas |is |important |for |a |forensic |accountant?
,a. |Information |technology.
b. |Psychology.
c. |Criminology.
d. |All |of |the |above |- |CORRECT |ANSWER✔✔-All |of |the |above
The |use |of |expert |witnesses |is |primarily |to |do |which |of |the |following?
a. |Settle |disputes |out-of-court.
b. |Assist |the |trier |of |fact.
c. |Be |an |advocate |for |the |defendant |or |plaintiff.
d. |Fulfill |the |court's |obligation |of |due |diligence. |- |CORRECT |ANSWER✔✔-Assist |the |trier |of |
fact.
According |to |professional |standards, |forensic |accountants |are |engaged |only |to |assist |lawyers |
as |they |prepare |for |litigation.
a. |True.
b. |False. |- |CORRECT |ANSWER✔✔-False
To |work |effectively, |a |forensic |accountant |should |have |a |basic |understanding |of |all |of |the |
following |except:
a. |Rules |of |evidence.
b. |Law |applicable |to |conspiracy |crimes.
c. |Court |systems.
d. |Enharmonic |equivalents. |- |CORRECT |ANSWER✔✔-Enharmonic |equivalents
Whereas |traditional |accounting |has |many |subspecialties |such |as |cost |accounting, |forensic |
accounting |has |relatively |few |sub-specialties.
a. |True.
,b. |False. |- |CORRECT |ANSWER✔✔-False
Auditors |and |forensic |accountants |are |similar |in |that |they |both______.
a. |Use |the |auditing |standards |issued |by |the |AICPA |to |guide |their |work.
b. |Are |required |to |be |independent |of |their |clients.
c. |Are |allowed |to |formulate |opinions |to |assist |their |clients |and |others.
d. |Must |be |licensed |to |practice |by |the |states |in |which |they |practice. |- |CORRECT |ANSWER✔✔-
Are |allowed |to |formulate |opinions |to |assist |their |clients |and |others.
What |are |the |key |elements |of |the |definition |of |forensic |accounting? |- |CORRECT |ANSWER✔✔-
Accounting, |special |skills, |law, |evidential |matter, |interpretation |and |communication
What |does |the |word |forensic |mean? |- |CORRECT |ANSWER✔✔-Pertaining |to |law
What |are |the |two |areas |into |which |the |practice |of |forensic |accounting |is |typically |divided? |- |
CORRECT |ANSWER✔✔-Litigation |and |investigative |services
How |does |auditing |differ |from |forensic |accounting? |- |CORRECT |ANSWER✔✔-While |both |
examine |evidence |and |form |professional |judgements |on |what |they |observe, |auditors |express |
opinions |on |financial |statements |as |a |whole |and |forensic |accountants |focus |on |one |or |more |
particular |areas.
By |whom |and |when |was |the |term |forensic |accounting |coined? |- |CORRECT |ANSWER✔✔-
Maurice |Peloubet |coined |the |term |in |1946 |by |publishing |the |article |"Forensic |Accounting |- |Its |
Place |in |Today's |Economy"
What |are |some |of |the |knowledge |and |skills |required |in |forensic |accounting? |- |CORRECT |
ANSWER✔✔-Auditing, |Criminal |and |Digital |Forensics, |Accounting |Information |systems, |Risk |
analysis, |communication, |psychology, |information |technology, |problem |solving, |legal.
, What |special |skills |and |knowledge |are |required |to |conduct |forensic |accounting |investigations?
|- |CORRECT |ANSWER✔✔-Understanding |of |how |to |structure |and |manage |an |investigation.
Know |the |types |of |evidence |that |may |be |collected.
How |to |maintain |the |chain |of |custody |.
Know |the |legal |rights |of |those |under |investigation.
Know |how |to |identify |different |types |of |fraud |schemes.
Know |how |to |conduct |interviews.
Know |how |to |detect |deception.
What |are |two |areas |in |which |forensic |accountants, |as |expert |consultants, |can |give |advice? |- |
CORRECT |ANSWER✔✔-The |value |of |an |estate, |internal |dispute |resolution |systems.
What |is |the |difference |between |fact |witnesses |and |expert |witnesses? |- |CORRECT |
ANSWER✔✔-Fact |witnesses |are |only |able |to |testify |to |what |they |perceive |personally |through |
their |sense |while |expert |witnesses |are |allowed |to |give |opinions |on |relevant |issues |before |the |
trier |of |fact.
What |are |the |three |management |activities |associated |with |fraud |risk |management? |- |
CORRECT |ANSWER✔✔-Identify |fraud |risk
Prevent |fraud |schemes
Detect |fraud |schemes
Name |three |organizations |that |are |applicable |to |forensic |accountants |and |discuss |which |
factors |play |a |role |in |determining |the |organizations |to |which |forensic |accountants |belong. |- |
CORRECT |ANSWER✔✔-The |factors |that |determine |the |organization |are |education, |training, |
experience, |and |areas |of |professional |focus.
American |Society |of |Appraisers |(ASA)
Association |of |Certified |Fraud |Examiners |(ACFE)
