ac574 final exm latest
Grade Details 1. Question:
(TCO A) Which statement is false?
Your Answer:
The Public Oversight Board was an independent private
sector body created in 1977.
The Public Oversight Board's report recommended a
number of forensic techniques to be included in audits.
The Public Oversight Board's report occurred after the CORRECT
issuance of SAS No. 99.
ANSWER
The Public Oversight Board's report suggested
converting a traditional audit to a "fraud audit."
All of the above are true. INCORRECT
Instructor Explanation: Chapter 1, page 1-12 - report issued in 2000 Points
Received: 0 of 4 2. Question:
(TCO A) Peremptory refers to:
Your Answer:
Be there first. CORRECT
Not requiring any cause to be
shown. One who strives to be
the best.
Take the place
of. None of the
above.
Instructor Explanation: Chapter 1, page 1-4. Points Received: 4 of 4 3. Question:
(TCO A) Which organization or group controls forensic accounting?
Your Answer:
ACFEI.
Association of Certified Fraud
Specialists. ACFE.
NACVA.
None of the above. CORRECT
Instructor Explanation: Chapter 2, page 2-14. None of the current certification groups
have been able to control forensic accountants. To an extent, forensic accounting is
business's orphan, being pushed and pulled by the accounting, economics, finance,
and valuation professions.
Points Received: 4 of 4 4. Question:
(TCO A) Which statement is false?
Your Answer:
The flexibility in GAAP gives management discretion to
use its professional opinion to choose from a range of
guidelines and standards in selecting those that suit the
needs of a company (e.g., FIFO or LIFO inventory
methods).
Nonfraudulent earnings management is accomplished
within the GAAP framework.
Fraudulent earnings management does not follow GAAP.
Transparency is one of the five interrelated components CORRECT
of internal controls.
ANSWER
All of the above are true. INCORRECT
,ac574 final exm latest
Instructor Explanation: Chapter 3, page 3-28. Points Received: 0 of 4 5. Question:
(TCO A) Control risk is:
Your Answer:
, ac574 final exm latest
A risk that a material error in the balance or transaction class
will not be prevented or detected. CORRECT
The risk that an account or transactions contain material
misstatements before the effects or the controls.
The measure of whether something is significant enough to
change an investor's investment decision is a prime
consideration in how the audit is conducted.
The risk that audit procedures will not turn up material
error when it exists.
None of the above.
Instructor Explanation: Chapter 4, page 4-4. Points Received: 4 of 4 6. Question:
(TCO A) Horizontal analysis typically involves what?
Your Answer:
Comparison of companies by market share in the
industry. Comparison of cash value at a predictable
moment in liquidity.
Comparison of year-to-year changes in financial statements. CORRECT
Comparison of organizational structure best suited for a
planned business venture.
Both a and b.
Instructor Explanation: Chapter 4, page 4-40. Points Received: 4 of 4 7. Question:
(TCO A) Given these facts, compute inventory turnover:
Total Assets $10,000,000
Cost of Goods Sold 2,200,000
Average Inventory 1,300,000
Interest Expense 850,000
Your Answer:
.59.
1.69. CORRECT
2.59.
7.69.
Not enough information is given.
Instructor Explanation: Chapter 4, page 4-42.
Inventory Turnover = Cost of goods sold/Average inventory = $2.2 mil/1.3 mil = 1.69
Points Received: 4 of 4 8. Question:
(TCO B) What audit step would be most appropriate for finding accounts receivables
fraud?
Your Answer:
A bank reconciliation
audit. Gross profit
analysis.
Reviewing customer complaints. CORRECT ANSWER
Surprise cash counts.
All of the above. INCORRECT
Instructor Explanation: Chapter 5, page 5-14. Points Received: 0 of 4 9. Question:
(TCO B) Which is a unique factor for solving a white-collar crime?
Your Answer:
Tracing of assets. CORRECT ANSWER
Availability of
Grade Details 1. Question:
(TCO A) Which statement is false?
Your Answer:
The Public Oversight Board was an independent private
sector body created in 1977.
The Public Oversight Board's report recommended a
number of forensic techniques to be included in audits.
The Public Oversight Board's report occurred after the CORRECT
issuance of SAS No. 99.
ANSWER
The Public Oversight Board's report suggested
converting a traditional audit to a "fraud audit."
All of the above are true. INCORRECT
Instructor Explanation: Chapter 1, page 1-12 - report issued in 2000 Points
Received: 0 of 4 2. Question:
(TCO A) Peremptory refers to:
Your Answer:
Be there first. CORRECT
Not requiring any cause to be
shown. One who strives to be
the best.
Take the place
of. None of the
above.
Instructor Explanation: Chapter 1, page 1-4. Points Received: 4 of 4 3. Question:
(TCO A) Which organization or group controls forensic accounting?
Your Answer:
ACFEI.
Association of Certified Fraud
Specialists. ACFE.
NACVA.
None of the above. CORRECT
Instructor Explanation: Chapter 2, page 2-14. None of the current certification groups
have been able to control forensic accountants. To an extent, forensic accounting is
business's orphan, being pushed and pulled by the accounting, economics, finance,
and valuation professions.
Points Received: 4 of 4 4. Question:
(TCO A) Which statement is false?
Your Answer:
The flexibility in GAAP gives management discretion to
use its professional opinion to choose from a range of
guidelines and standards in selecting those that suit the
needs of a company (e.g., FIFO or LIFO inventory
methods).
Nonfraudulent earnings management is accomplished
within the GAAP framework.
Fraudulent earnings management does not follow GAAP.
Transparency is one of the five interrelated components CORRECT
of internal controls.
ANSWER
All of the above are true. INCORRECT
,ac574 final exm latest
Instructor Explanation: Chapter 3, page 3-28. Points Received: 0 of 4 5. Question:
(TCO A) Control risk is:
Your Answer:
, ac574 final exm latest
A risk that a material error in the balance or transaction class
will not be prevented or detected. CORRECT
The risk that an account or transactions contain material
misstatements before the effects or the controls.
The measure of whether something is significant enough to
change an investor's investment decision is a prime
consideration in how the audit is conducted.
The risk that audit procedures will not turn up material
error when it exists.
None of the above.
Instructor Explanation: Chapter 4, page 4-4. Points Received: 4 of 4 6. Question:
(TCO A) Horizontal analysis typically involves what?
Your Answer:
Comparison of companies by market share in the
industry. Comparison of cash value at a predictable
moment in liquidity.
Comparison of year-to-year changes in financial statements. CORRECT
Comparison of organizational structure best suited for a
planned business venture.
Both a and b.
Instructor Explanation: Chapter 4, page 4-40. Points Received: 4 of 4 7. Question:
(TCO A) Given these facts, compute inventory turnover:
Total Assets $10,000,000
Cost of Goods Sold 2,200,000
Average Inventory 1,300,000
Interest Expense 850,000
Your Answer:
.59.
1.69. CORRECT
2.59.
7.69.
Not enough information is given.
Instructor Explanation: Chapter 4, page 4-42.
Inventory Turnover = Cost of goods sold/Average inventory = $2.2 mil/1.3 mil = 1.69
Points Received: 4 of 4 8. Question:
(TCO B) What audit step would be most appropriate for finding accounts receivables
fraud?
Your Answer:
A bank reconciliation
audit. Gross profit
analysis.
Reviewing customer complaints. CORRECT ANSWER
Surprise cash counts.
All of the above. INCORRECT
Instructor Explanation: Chapter 5, page 5-14. Points Received: 0 of 4 9. Question:
(TCO B) Which is a unique factor for solving a white-collar crime?
Your Answer:
Tracing of assets. CORRECT ANSWER
Availability of
