[Feb-2024] Pass ACFE CFE-Fraud-Prevention-and-Deterrence Tests Engine pdf - All Free Dumps
Certified Fraud Examiner - Fraud Prevention and Deterrence Exam Practice Tests 2024 | Pass CFE-Fraud-Prevention-and-Deterrence with confidence!
NEW QUESTION # 21
Which of the following Is NOT considered a conflict of Interest that Is prohibited under the ACFE Code of Professional Ethics?
- A. Accepting an assignment to secretly infiltrate the fraud examiner's employing organization and transmit inside information to another party
- B. Undertaking an engagement that decreases the fraud examiner's ability to perform their duties for their full-time employer
- C. Accepting an assignment to assess red flags of fraud at an organization in which the fraud examiner is a partner, provided the fraud examiner's ownership interest is disclosed
- D. Undertaking engagements for both sides in a case of an alleged product substitution scheme
Answer: C
NEW QUESTION # 22
Who is ultimately responsible lor ensuring the effectiveness of the organization's anti-fraud program?
- A. Internal auditors
- B. Management
- C. External auditors
- D. The compliance function
Answer: B
NEW QUESTION # 23
Open-door management policies are a fraud prevention mechanism that addresses which leg of the Fraud Triangle?
- A. Opportunity
- B. Pressure
- C. Willingness
- D. Lack of integrity
Answer: A
NEW QUESTION # 24
Stevens, a Certified Fraud Examiner (CFE), was hired to conduct a fraud examination at ABC Company. His examination did not reveal any conclusive evidence that fraud had occurred or was occurring. Consequently, ABC's management asked Stevens to state in his official examination report that the organization is free of fraud as a means of assuring the board of directors that the company's anti-fraud controls were effective. Under the ACFE Code of Professional Ethics. Stevens is permitted to comply with management's request based on the findings of his examination.
- A. False
- B. True
Answer: A
NEW QUESTION # 25
The objective of anti-fraud controls is to:
- A. Reduce the inherent fraud risk to a level that is significantly smaller than the residual fraud risk.
- B. Reduce the residual fraud risk to a level that is significantly smaller than the inherent fraud risk
- C. Completely eliminate inherent fraud risk
- D. Completely eliminate residual fraud risk
Answer: D
NEW QUESTION # 26
Which of the following is one of the components of the Committee of Sponsoring Organizations of the Treactway Commission's (COSO) Enterprise Risk Management-Integrating with Strategy and Performance?
- A. Compliance
- B. Event avoidance
- C. Review and revision
- D. Risk tolerance
Answer: D
NEW QUESTION # 27
For its compliance program to be effective, an organization must promote the program through appropriate incentives for compliance.
- A. False
- B. True
Answer: B
NEW QUESTION # 28
In response to a risk identified during a fraud risk assessment, management decides to implement additional internal control measures. This response is known as:
- A. Assuming the risk
- B. Avoiding the risk
- C. Transferring the risk
- D. Mitigating the risk
Answer: D
NEW QUESTION # 29
Which of the following best describes the purpose of The National Commission on Fraudulent Financial Reporting (the Treadway Commission)?
- A. Designing a model corporate compliance program
- B. Determining the specific requirements of the Principles of Risk Management
- C. Studying the effect of the threat of vicarious liability on the behavior of corporate executives
- D. Defining the responsibility of the auditor in preventing and detecting fraud
Answer: D
NEW QUESTION # 30
Which of the following is NOT a way that an organization's fraud risk assessment should be incorporated into the audit process''
- A. It should be used to design audit tests to evaluate whether the controls are operating effectively
- B. It should be used to assess whether there is a moderate-to-high risk of management override of internal controls within the moderate-to-high fraud risk areas
- C. It should be used to increase awareness in the development of audit programs for areas that have been identified as having a moderate-to-high risk of fraud.
- D. It should be used to replace the auditor's own identification and assessment of fraud risks.
Answer: D
NEW QUESTION # 31
Which of the following is NOT considered a conflict of interest that is prohibited under the ACFE Code of Professional Ethics?
- A. Accepting an assignment to secretly infiltrate the fraud examiner's employing organization and transmit inside information to another party
- B. Accepting an assignment to evaluate the anti-fraud controls at an organization in which the fraud examiner is a shareholder, provided the fraud examiner's ownership interest is disclosed
- C. Undertaking an engagement that decreases the fraud examiner's ability to perform their duties for their full-time employer
- D. Undertaking engagements for both sides in a case of alleged vendor overbilling
Answer: B
NEW QUESTION # 32
Smith, a retail sales manager, wants to decrease the level of cash register over-and-short discrepancies among his sales team. According to behaviorist theories, which of the following options would be the most effective way for Smith to encourage his team members to keep their cash drawers in balance?
- A. Publicly call out and criticize employees whose cash drawers are over or short
- B. Take away an hour of paid time off for each time the drawer is over or short.
- C. Offer a bonus to anyone whose drawer reconciles perfectly for sixty days.
- D. Demote employees who continue to have reconciliation discrepancies
Answer: C
NEW QUESTION # 33
Gregory, an internal auditor, and Brandon, the company's purchasing manager, have had several heated disagreements over purchasing procedures and policies. Gregory has just been told that he will be the lead on the company's fraud risk assessment. During the fraud risk assessment. Gregory should:
- A. Confront Brandon about the disagreements and discuss how they increase the organization's risk of fraud-
- B. Have someone else perform the fraud risk assessment work related to the purchasing function
- C. Automatically designate the purchasing function as a high-risk area.
- D. Include his disagreements with Brandon as a factor when assessing the risk of fraud in the purchasing function.
Answer: D
NEW QUESTION # 34
Which of the following statements is FALSE?
- A. Conducting covert audits is among the most effective fraud prevention methods
- B. Educating employees about company hotlines and reporting programs increases their perception of detection
- C. Most experts agree that it is harder to detect frauds than to prevent them
- D. Controls do little good in preventing theft and fraud if those at risk do not know of their presence
Answer: D
NEW QUESTION # 35
Fraud risks related lo corruption include all of the following EXCEPT
- A. Payment of bribes
- B. Aiding and abetting vendor fraud
- C. Espionage by competitor
- D. Receipt of kickbacks
Answer: D
NEW QUESTION # 36
Which of the following statements regarding best practices that organizations can take to protect and support whistleblowers is MOST ACCURATE?
- A. Organizations should establish formal consequences that are to be imposed upon employees at the company who retaliate against a whistleblower.
- B. Organizations should emphasize that rules regarding whistleblower protections are only intended for lower level employees who might be more vulnerable to retaliation.
- C. Organizations should implement a clear whistleblower policy that lists out every type of misconduct that has ever been reported at the company.
- D. Organizations should publicize their whistleblower procedures internally but should avoid communicating any procedural information to parties outside of the organization.
Answer: A
NEW QUESTION # 37
Gray, an independent Certified Fraud Examiner (CFE). was hired by Green president of the ABC Corporation, to investigate allegations that one oi ABC s employees is taking kickbacks. During the investigation. Gray learns that Green is involved in an unrelated fraud. Under the ACFE Code of Professional Ethics. Gray should:
- A. Tell the company's board of directors about Green
- B. Not disclose the information about Green.
- C. Report Green to law enforcement.
- D. Resign from the engagement
Answer: C
NEW QUESTION # 38
Which of the following is FALSE regarding a fraud risk assessment?
- A. The designation of an area as being high risk does not conclusively mean that fraud is occurring there
- B. The assessment should be used to improve employee fraud awareness
- C. The objective of the assessment is to provide an estimate of the organization s fraud losses
- D. The assessment team should consider how employees behave as part of its assessment
Answer: C
NEW QUESTION # 39
A report by a fraud examiner is privileged from disclosure by anyone other than the client
- A. False
- B. True
Answer: B
NEW QUESTION # 40
Which of the following theories suggests that, when considering the possibility of violating a law. people are likely to ask themselves. "What will my spouse think if they find out?"
- A. Social control theory
- B. Cognitive theory
- C. Operant theory
- D. Behavioral theory
Answer: A
NEW QUESTION # 41
According to G20/OECD Principles of Corporate Governance (the Principles):
- A. A corporate governance framework should focus on the rights of shareholders but does not need to include the rights of other organizational stakeholders
- B. All of the above
- C. Governments should have in place a corporate governance framework that promotes transparent and fair markets
- D. Companies should disclose all financial information to investors, regardless of the cost burden of the disclosure
Answer: C
NEW QUESTION # 42
The Public Interest Oversight Board (PIOB) is the global body responsible for establishing international corporate governance standards.
- A. False
- B. True
Answer: A
NEW QUESTION # 43
Which of the following statements is TRUE regarding how fraud examiners should exercise professional skepticism during a fraud examination engagement?
- A. Fraud examiners should form the engagement hypothesis without regard to the available preliminary information
- B. Professional skepticism involves maintaining a mindset that no fraud has occurred
- C. Fraud examiners should not relax their skeptical attitudes even if there are no signs of fraudulent activity.
- D. Professional skepticism means beginning all assignments with the belief that something is amiss
Answer: D
NEW QUESTION # 44
Risk management is focused on balancing the organization's___________with Its____________.
- A. Objectives; resources
- B. Internal controls; financial reporting model
- C. Regulatory requirements, risk appetite
- D. Risk appetite, ability to meet its objectives
Answer: D
NEW QUESTION # 45
Which of the following is NOT a responsibility of the organization's board of directors?
- A. Assessing the strategy and underlying purpose of management's decisions and actions
- B. Directing employees to execute business activities
- C. Serving as the intermediaries between shareholders and management
- D. Acting as guardians of the organization's resources and assets
Answer: B
NEW QUESTION # 46
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