CFE-FINANCIAL-TRANSACTIONS-AND-FRAUD-SCHEMES Online Practice Questions and Answers

Delivery has not occurred or services have not been rendered when:

A. Until installation and customer testing and acceptance has occurred.

B. A written order exists but contains a right of return.

C. Both A and B

D. Neither A nor B

________ increase assets and expenses and/or decrease liabilities and/or equity

A. Journal Entries

B. Debit

C. Credit

D. None of all

Employees with the authority to grant discounts in order to skim revenues may use which authority?

A. False discounts

B. Recording a discount on sale procedure

C. Internal discount sales audits

D. None of the above

The scheme which reduces victim companies to issue fraudulent payments for goods or services that they have not received is called:

A. Bogus claims

B. Billing scheme

C. Reliance billing

D. Misappropriate claims

The excess credits (or debits) on the income statement are used to decrease (or increase) the equity account.

A. True

B. False

A special scheme in which employees know their employer is seeking to purchase a certain asset and take advantage of the situation by purchasing the asset themselves is:

A. Conflict of interest in sale

B. Turnaround sale or flip

C. Unauthorized sale

D. Written sale of unique assets

Which of the following can constitute a bribe, even if the illicit payment is never actually made?

A. Offering a payment

B. Corruption in payment

C. kickback payment

D. Overbilling in payment

In physical tampering prevention technique, hidden images can be seen only when the check is held at an angle through:

A. High-resolution sprays

B. Holographic safety inks

C. Watermark backers

D. Chrome coloring

______________ can be detected by closely examining the documentation submitted with the cash receipts.

A. Voided purchases

B. Fictitious refunds

C. Approved transaction

D. None of the above

In ___________ scheme, an employee creates false vouchers or submits false invoices to the employer.

A. Sale requisition

B. Purchase requisition

C. Voucher handling

D. Cash generating

Once the expense account is closed, it becomes a historical item and probably will never be reviewed again.

A. True

B. False

According to a survey, in principal perpetrator, males in a majority of cases, accounting for ___ percent of frauds versus ___ percent in which a female was the primary culprit.

A. 62 versus 36

B. 61 versus 39

C. 62 versus 37

D. None of the above

Which of the following is true for Red flags associated with fictitious revenues?

A. Slow growth or usual profitability, when not compared to other companies in the same industry.

B. Usual growth in the number of days purchase in receivables

C. A significant volume of sales to entries whose substance and ownership is not known.

D. A usual surge in purchase by a majority of units within a company, or of purchase recorded by corporate headquarters.

What is sometimes used to overcome well-designed internal controls of a victim company?

A. Shell company

B. Fraudulent invoices

C. Collusion

D. Rubber stamp supervisors

_________ normally are carried on an organization's books as expenses because they tend to be consumed by the organization within a year of purchase.

A. Supplies

B. Expenses

C. Assets

D. Equity