FRAUD EXAM SCRIPT SOLVED QUESTIONS
ACCURATE ANSWER COLLECTION
●● Perpetrators use trickery, confidence, and deception to commit fraud.
Answer: TRUE
●● One of the most common responses to fraud is disbelief by those
around the fraud.
Answer: TRUE
●● Manufacturing companies with a profit margin of 10% must usually
generate about 10 times as much revenue as the dollar amount of the
fraud in order to restore net income to its pre-fraud level.
Answer: TRUE
●● Fraud involves using physical force to take something from
someone.
Answer: FALSE.
Using physical force to take something from someone is robbery. Fraud
involves debit or trickery, not force.
●● When perpetrators are criminally convicted of fraud, they often serve
jail sentences and/or pay fines.
,Answer: TRUE
●● Identity theft is an example of employee embezzlement.
Answer: FALSE.
Identity theft is stealing someone's personal information so the thief can
pretend to be that person.
●● Management fraud is deception perpetrated by an organization's top
management.
Answer: TRUE
●● A Ponzi Scheme is considered to be a type of investment scam.
Answer: TRUE
●● Most people agree that fraud-related careers will be in demand in the
future.
Answer: TRUE
●● In civil cases, fraud experts are rarely used as expert witnesses.
Answer: FALSE.
In civil cases, fraud experts often serve as expert witnesses.
,●● Many companies try to hide their losses from fraud rather than make
them public.
Answer: TRUE.
●● The only group/business that must report employee embezzlement is
the federal government.
Answer: FALSE.
Banks are required to report their frauds to the government because of
their FDIC Insurance.
●● Advances in technology have had no effect either on size or
frequency of fraud or on the detection or investigation of fraud.
Answer: FALSE.
Technology has tended to increase the size and frequency of frauds
committed.
●● Fraud losses generally reduce a firm's income on a dollar-for-dollar
basis.
Answer: TRUE.
●● The single most critical element for a fraud to be successful is
opportunity.
Answer: FALSE.
, Confidence is the single most critical element for a fraud to be
successful.
●● Fraud perpetrators are often those who are least suspected and most
trusted.
Answer: TRUE.
●● Unintentional errors in financial statement are a form of fraud.
Answer: FALSE.
Unintentional errors in the financial statements are not considered fraud.
There must always be "intent" for something to be fraud.
●● Occupational fraud is fraud committed on behalf of an organization.
Answer: FALSE.
Occupational fraud is usually committed against an organization.
●● Companies that commit financial statement fraud are often
experiencing net losses or have profits that are significantly lower than
expectations.
Answer: TRUE.
●● Indirect fraud occurs when a company's assets go directly into the
perpetrator's pockets without the involvement of third parties.
Answer: FALSE.
ACCURATE ANSWER COLLECTION
●● Perpetrators use trickery, confidence, and deception to commit fraud.
Answer: TRUE
●● One of the most common responses to fraud is disbelief by those
around the fraud.
Answer: TRUE
●● Manufacturing companies with a profit margin of 10% must usually
generate about 10 times as much revenue as the dollar amount of the
fraud in order to restore net income to its pre-fraud level.
Answer: TRUE
●● Fraud involves using physical force to take something from
someone.
Answer: FALSE.
Using physical force to take something from someone is robbery. Fraud
involves debit or trickery, not force.
●● When perpetrators are criminally convicted of fraud, they often serve
jail sentences and/or pay fines.
,Answer: TRUE
●● Identity theft is an example of employee embezzlement.
Answer: FALSE.
Identity theft is stealing someone's personal information so the thief can
pretend to be that person.
●● Management fraud is deception perpetrated by an organization's top
management.
Answer: TRUE
●● A Ponzi Scheme is considered to be a type of investment scam.
Answer: TRUE
●● Most people agree that fraud-related careers will be in demand in the
future.
Answer: TRUE
●● In civil cases, fraud experts are rarely used as expert witnesses.
Answer: FALSE.
In civil cases, fraud experts often serve as expert witnesses.
,●● Many companies try to hide their losses from fraud rather than make
them public.
Answer: TRUE.
●● The only group/business that must report employee embezzlement is
the federal government.
Answer: FALSE.
Banks are required to report their frauds to the government because of
their FDIC Insurance.
●● Advances in technology have had no effect either on size or
frequency of fraud or on the detection or investigation of fraud.
Answer: FALSE.
Technology has tended to increase the size and frequency of frauds
committed.
●● Fraud losses generally reduce a firm's income on a dollar-for-dollar
basis.
Answer: TRUE.
●● The single most critical element for a fraud to be successful is
opportunity.
Answer: FALSE.
, Confidence is the single most critical element for a fraud to be
successful.
●● Fraud perpetrators are often those who are least suspected and most
trusted.
Answer: TRUE.
●● Unintentional errors in financial statement are a form of fraud.
Answer: FALSE.
Unintentional errors in the financial statements are not considered fraud.
There must always be "intent" for something to be fraud.
●● Occupational fraud is fraud committed on behalf of an organization.
Answer: FALSE.
Occupational fraud is usually committed against an organization.
●● Companies that commit financial statement fraud are often
experiencing net losses or have profits that are significantly lower than
expectations.
Answer: TRUE.
●● Indirect fraud occurs when a company's assets go directly into the
perpetrator's pockets without the involvement of third parties.
Answer: FALSE.
