ACFE Review - Fraud Prevention and
Deterrence questions and answers
rated
T/F: In a public company, the chief executive officer (CEO) should be charged with having
primary responsibility for the oversight of the company's compliance program. - ANS ✔✔False
T/F: According to the International Organization of Supreme Audit Institutions' (INTOSAI)
standards for public-sector audits, the requirements for private-sector external auditors found
in International Standard on Auditing (ISA) 240, 'The Auditor's Responsibility Relating to Fraud in
an Audit of Financial Statements,' also apply to government auditors during audits of public-
sector financial statements. - ANS ✔✔True
Which of the following should be covered in employee anti-fraud training? - ANS ✔✔Examples
of past transgressions and how they were handled.
T/F: Criminal activities involving corporations stem primarily from the organization's subcultures
and values, rather than from the attitudes and characteristics of the individuals carrying out the
crimes. - ANS ✔✔True
According to 'Fraud Risk Management Guide,' a joint publication by COSO and the ACFE, who
has responsibility for managing fraud risk? - ANS ✔✔Personnel at all levels of the organization
T/F: A fraud risk assessment report should reflect the assessment team's subjective perspective
and opinions that were formed during the assessment engagement. - ANS ✔✔False
Which of the following is NOT one of the eight principles for risk management provided by the
International Organization for Standardization (ISO) 31000:2018? - ANS ✔✔The risk
management program is based on effective leadership and commitment.
, To reinforce an anti-fraud culture, management should: - ANS ✔✔All of the above
Which of the following is among the audit committee's responsibilities for fraud risk
management? - ANS ✔✔Receiving regular reports on the status of reported or alleged fraud
T/F: Luna, a Certified Fraud Examiner (CFE), was hired to investigate a company. After she
carefully examined the company, she issued a report that stated, in part, "In my opinion, this
operation is free of material fraud." Such an opinion is permitted under the ACFE Code of
Professional Ethics. - ANS ✔✔False
Which of the following statements regarding recommended vendor due diligence procedures is
LEAST ACCURATE? - ANS ✔✔An organization should request that new vendors fill out a
questionnaire about their background immediately after signing a contract with them.
Which of the following parties is ultimately responsible for the prevention and detection of
fraud within an organization? - ANS ✔✔Management
The primary purpose of International Standard on Auditing (ISA) 240 is to: - ANS ✔✔Establish
standards and provide guidance on the auditor's responsibility to consider fraud in an audit of
financial statements
T/F: In the context of a fraud examination, the preservation of integrity requires that the fraud
examiner avoid all differences of opinion regarding all material matters with the other parties to
the engagement. - ANS ✔✔False
T/F: As part of its vendor due diligence procedures, an organization should avoid revealing that
it is seeking information about potential vendors prior to starting a relationship with them. -
ANS ✔✔False
Deterrence questions and answers
rated
T/F: In a public company, the chief executive officer (CEO) should be charged with having
primary responsibility for the oversight of the company's compliance program. - ANS ✔✔False
T/F: According to the International Organization of Supreme Audit Institutions' (INTOSAI)
standards for public-sector audits, the requirements for private-sector external auditors found
in International Standard on Auditing (ISA) 240, 'The Auditor's Responsibility Relating to Fraud in
an Audit of Financial Statements,' also apply to government auditors during audits of public-
sector financial statements. - ANS ✔✔True
Which of the following should be covered in employee anti-fraud training? - ANS ✔✔Examples
of past transgressions and how they were handled.
T/F: Criminal activities involving corporations stem primarily from the organization's subcultures
and values, rather than from the attitudes and characteristics of the individuals carrying out the
crimes. - ANS ✔✔True
According to 'Fraud Risk Management Guide,' a joint publication by COSO and the ACFE, who
has responsibility for managing fraud risk? - ANS ✔✔Personnel at all levels of the organization
T/F: A fraud risk assessment report should reflect the assessment team's subjective perspective
and opinions that were formed during the assessment engagement. - ANS ✔✔False
Which of the following is NOT one of the eight principles for risk management provided by the
International Organization for Standardization (ISO) 31000:2018? - ANS ✔✔The risk
management program is based on effective leadership and commitment.
, To reinforce an anti-fraud culture, management should: - ANS ✔✔All of the above
Which of the following is among the audit committee's responsibilities for fraud risk
management? - ANS ✔✔Receiving regular reports on the status of reported or alleged fraud
T/F: Luna, a Certified Fraud Examiner (CFE), was hired to investigate a company. After she
carefully examined the company, she issued a report that stated, in part, "In my opinion, this
operation is free of material fraud." Such an opinion is permitted under the ACFE Code of
Professional Ethics. - ANS ✔✔False
Which of the following statements regarding recommended vendor due diligence procedures is
LEAST ACCURATE? - ANS ✔✔An organization should request that new vendors fill out a
questionnaire about their background immediately after signing a contract with them.
Which of the following parties is ultimately responsible for the prevention and detection of
fraud within an organization? - ANS ✔✔Management
The primary purpose of International Standard on Auditing (ISA) 240 is to: - ANS ✔✔Establish
standards and provide guidance on the auditor's responsibility to consider fraud in an audit of
financial statements
T/F: In the context of a fraud examination, the preservation of integrity requires that the fraud
examiner avoid all differences of opinion regarding all material matters with the other parties to
the engagement. - ANS ✔✔False
T/F: As part of its vendor due diligence procedures, an organization should avoid revealing that
it is seeking information about potential vendors prior to starting a relationship with them. -
ANS ✔✔False
