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CFE-Financial-Transactions-and-Fraud-Schemes Certified Fraud Examiner - Financial Transactions and Fraud Schemes Exam Questions and Answers

Questions 4

When employees avoid detection in a refund scheme to keep the sizes of the disbursement low, is referred to:

Options:

A.

Small disbursements

B.

Very small disbursements

C.

Simple disbursements

D.

None of the above

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Questions 5

Perceived certainty of detection is directly related to employee theft for respondents in all industry sectors, that is the stronger the perception that theft would be detected, the more the likelihood that the employee would engage in deviant behavior.

Options:

A.

True

B.

False

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Questions 6

A person is said to be in ________ act, when the business which he transacts, or the money or property which he handles, is not for his own benefit, but for another person:

Options:

A.

Fiduciary Capacity

B.

Embezzlement

C.

Conversion

D.

None of the above

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Questions 7

The difference between assets and liabilities is called:

Options:

A.

Equity

B.

Expense

C.

Revenue

D.

Income statement

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Questions 8

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

Options:

A.

High-resolution sprays

B.

Holographic safety inks

C.

Watermark backers

D.

Chrome coloring

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Questions 9

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

Options:

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.

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Questions 10

__________ inventory and other assets is relatively common way for fraudsters to remove assets from the books before or after they are stolen.

Options:

A.

Altered

B.

Perpetual

C.

False shipping slip

D.

Write-offs

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Questions 11

Occupational fraud and abuse is a (an) __________ of doing business, in much the same way that we pay expenses for electricity, taxes and wages.

Options:

A.

Equity

B.

Balance sheet

C.

Expense

D.

Financial record

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Questions 12

A running count that records how much inventory should be on hand is referred to:

Options:

A.

Altered inventory

B.

Perpetual inventory

C.

Shrinking inventory

D.

Fictitious inventory

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Questions 13

Fraudsters use the accounting system as a tool to generate the results they want in ___________ approach:

Options:

A.

Organized accounting

B.

Playing the accounting

C.

beating accounting

D.

All of the above

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Questions 14

A ___________ occurs when an employee, manager or executive has an undisclosed economic or personal interest in a transaction that adversely affects the organization.

Options:

A.

Conflict of interest

B.

Illegal sale

C.

Unauthorized purchase

D.

Financial disclosure

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Questions 15

__________ are the amounts which are owned to other entities:

Options:

A.

Supplies

B.

Expenses

C.

Assets

D.

Liabilities

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Questions 16

When employee committing the fraud removes cash from the register and also the item allegedly being returned is debited back into the inventory, this refers to:

Options:

A.

Registry destroying records

B.

Register false voids

C.

Fraudulent register occurrences

D.

Concealing register disbursement

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Questions 17

Which check tampering red flag may indicate employees have embezzled cash and charged the embezzlement to expense accounts?

Options:

A.

Voided checks

B.

Payable checks

C.

Missing checks

D.

Duplicate checks

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Questions 18

Which of the following is NOT the reason why senior management will overstate business statement?

Options:

A.

Comply with debit covenants

B.

Meet personal performance criteria

C.

Trigger performance related compensation

D.

Show a pattern of growth to support sale of a business

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Questions 19

Which counts sometimes can give rise to inventory theft detection?

Options:

A.

Perpetual inventory counts

B.

Physical inventory counts

C.

Concealment inventory counts

D.

None of the above

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Questions 20

The most basic skimming scheme occurs when:

Options:

A.

An employee sells goods or services to a customer, collects the customer’s payment, but makes no record of the sale.

B.

An employee buy goods or services from a customer, drop the customer’s payment, but makes no record of the purchase.

C.

An employee sells goods or services to a stakeholder, collects the stakeholder’s payment and makes record of the sale too.

D.

An employee buy goods or services from a stakeholder, drop the stakeholder’s payment and makes record of the purchase too.

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Questions 21

___________ and __________ are used to increase (or decrease) the equity account.

Options:

A.

Journal Entries & Debit

B.

Journal Entries & transactions

C.

Journal Entries & Credit

D.

None of all

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Questions 22

In ____________ scheme, a supplier pays an employee of the purchasing company to write specifications that will require amendments at a later date.

Options:

A.

Deliberate writing of vague specifications

B.

Need recognition

C.

False specification

D.

Bid-splitting

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Questions 23

According to Hollinger and Clark for Policy development, management must pay attention to:

Options:

A.

A clear understanding regarding theft behavior

B.

Enforcement of sanctions

C.

Both A & B

D.

Neither A nor B

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Questions 24

Entering a sales total lower than the amount actually paid by the customer is called:

Options:

A.

Underrings a sale

B.

Recording a sale procedure

C.

Internal sales audits

D.

All of the above

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Questions 25

The most common method for billing scheme is:

Options:

A.

Register

B.

Tips

C.

Accident

D.

None of the above

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Questions 26

By removing a tangible asset from the business (a debit), the books will be ___________ by the exact amount of the tangible asset misappropriated.

Options:

A.

Journal Entries

B.

Out-of-balance

C.

False debits

D.

None of all

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Questions 27

When employee committing the fraud removes cash from the register and also the item allegedly being returned is debited back into the inventory, this refers to:

Options:

A.

Registry destroying records

B.

Register false voids

C.

Fraudulent register occurrences

D.

Concealing register disbursement

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Exam Name: Certified Fraud Examiner - Financial Transactions and Fraud Schemes Exam
Last Update: Apr 23, 2024
Questions: 186

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