LSU ACCT 4235 - MIDTERM REVIEW (CH. 1-9
QUIZZES)
Investment scams most often include:
A. an action by top management against employees
B. worthless investments or assets sold to unsuspecting investors
C. an overcharge for purchased goods
D. nonpayment of invoices for goods purchased by customers - Answer -B
Which of the following is not a common type of fraud?
A. direct employee embezzlement
B. employee bribes
C. executives embezzling from petty cash
D. investment scams - Answer -C
Which of the following characters is least likely to be involved in a fraud?
A. a middle-aged person with a middle management position
B. a long-haired teenager
C. a senior executive who has significant stock options
D. a recent college graduate - Answer -B
Which of the following is required to become a CFE?
A. an individual must commit to abide by a strict code of professional conduct and ethics
B. be an associate member, in good standing, of the ACFE
C. be of high moral character
D. all of the above are required - Answer -D
Which of the following statements is true?
A. All frauds that are detected by organizations are made public.
B. One of the most common responses to fraud is disbelief by those around the fraud.
C. Many companies choose to make their losses from fraud public rather than try to
hide them.
D. The only group/business that must report employee embezzlement is the federal
government. - Answer -B
What is the best way to minimize fraud expense within an organization?
A. effective early detection of fraud
B. effective investigation of fraudulent behavior
C. effective prevention of fraud
D. effective research of fraud - Answer -C
What is the most important element in successful fraud schemes?
A. promised benefits
B. confidence in the perpetrator
, C. profitable activities
D. complexity - Answer -B
Which of the following is not an important element of fraud?
A. confidence
B. deception
C. trickery
D. intelligence - Answer -D
Which of the following statements is false?
A. Manufacturing companies with a profit margin of 10 percent 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.
B. Fraud losses generally reduce a firm's income on a dollar-for-dollar basis.
C. Unintentional errors in financial statements are a form of fraud.
D. Companies that commit financial statement fraud are often experiencing net losses
or have profits that are significantly lower than expectations. - Answer -C
Which of the following is the least reliable resource for fraud statistics?
A. FBI agencies
B. health agencies
C. insurance organizations
D. fraud perpetrators - Answer -D
Opportunities to commit fraud can be eliminated by identifying sources of fraud, by
implementing controls, and through independent checks. One other effective way of
eliminating opportunities is:
A. teaching employees to monitor and report fraud
B. terminating and punishing employees who commit fraud
C. failing to terminate or punish employees who commit fraud
D. identifying indicators of fraud or red flags - Answer -A
Because of the ability to override internal controls, it is usually most difficult to prevent
which type of fraud?
A. investment scams
B. fraud committed by a company president
C. employee fraud
D. customer fraud - Answer -B
Research shows that fraud occurs less frequently when employees feel:
A. abused by management
B. threatened
C. challenged with unreasonable performance goals
D. ownership in the organization - Answer -D
QUIZZES)
Investment scams most often include:
A. an action by top management against employees
B. worthless investments or assets sold to unsuspecting investors
C. an overcharge for purchased goods
D. nonpayment of invoices for goods purchased by customers - Answer -B
Which of the following is not a common type of fraud?
A. direct employee embezzlement
B. employee bribes
C. executives embezzling from petty cash
D. investment scams - Answer -C
Which of the following characters is least likely to be involved in a fraud?
A. a middle-aged person with a middle management position
B. a long-haired teenager
C. a senior executive who has significant stock options
D. a recent college graduate - Answer -B
Which of the following is required to become a CFE?
A. an individual must commit to abide by a strict code of professional conduct and ethics
B. be an associate member, in good standing, of the ACFE
C. be of high moral character
D. all of the above are required - Answer -D
Which of the following statements is true?
A. All frauds that are detected by organizations are made public.
B. One of the most common responses to fraud is disbelief by those around the fraud.
C. Many companies choose to make their losses from fraud public rather than try to
hide them.
D. The only group/business that must report employee embezzlement is the federal
government. - Answer -B
What is the best way to minimize fraud expense within an organization?
A. effective early detection of fraud
B. effective investigation of fraudulent behavior
C. effective prevention of fraud
D. effective research of fraud - Answer -C
What is the most important element in successful fraud schemes?
A. promised benefits
B. confidence in the perpetrator
, C. profitable activities
D. complexity - Answer -B
Which of the following is not an important element of fraud?
A. confidence
B. deception
C. trickery
D. intelligence - Answer -D
Which of the following statements is false?
A. Manufacturing companies with a profit margin of 10 percent 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.
B. Fraud losses generally reduce a firm's income on a dollar-for-dollar basis.
C. Unintentional errors in financial statements are a form of fraud.
D. Companies that commit financial statement fraud are often experiencing net losses
or have profits that are significantly lower than expectations. - Answer -C
Which of the following is the least reliable resource for fraud statistics?
A. FBI agencies
B. health agencies
C. insurance organizations
D. fraud perpetrators - Answer -D
Opportunities to commit fraud can be eliminated by identifying sources of fraud, by
implementing controls, and through independent checks. One other effective way of
eliminating opportunities is:
A. teaching employees to monitor and report fraud
B. terminating and punishing employees who commit fraud
C. failing to terminate or punish employees who commit fraud
D. identifying indicators of fraud or red flags - Answer -A
Because of the ability to override internal controls, it is usually most difficult to prevent
which type of fraud?
A. investment scams
B. fraud committed by a company president
C. employee fraud
D. customer fraud - Answer -B
Research shows that fraud occurs less frequently when employees feel:
A. abused by management
B. threatened
C. challenged with unreasonable performance goals
D. ownership in the organization - Answer -D
