The existence of many specialized departments within a company generally decreases the overall risk of fraud within the organization

• A.False
• B.True

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According to the results of behavioral studies, such as those conducted by B. F. Skinner, application of punishment to undesired behavior typically results in which of the following?

• A.increase in the occurrence of the undesired behavior
• B.No effect on the occurrence of the undesired behavior
• C.Temporary suppression of the undesired behavior
• D.Permanent suppression of the undesired behavior

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Which of the following statements is FALSE?

• A.Controls are not effective in preventing theft and fraud If those at risk do not know of their presence
• B.Most experts agree that it is harder to detect frauds than to prevent them
• C.Educating employees about company hotlines and reporting programs increases their perception of detection
• D.Conducting covert audits is among the most effective fraud prevention methods

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Gray, an independent Certified Fraud Examiner (CFE), was hired by Green, president of the ABC Corporation, to investigate allegations that one of ABC's employees is taking kickbacks. During the investigation. Gray teams that Green is involved in an unrelated fraud. Under the ACFE Code of Professional Ethics. Gray should:

• A.Not disclose the information about Green.
• B.Report Green to law enforcement
• C.Tell the company's board of directors about Green.
• D.Resign from the engagement

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Adan, an internal auditor who works at BKY Co., is reviewing the auditing procedures for his company. He is specifically considering the ways BKY can proactively audit for fraud. Which of the following is TRUE regarding the use of proactive fraud auditing procedures at BKY?

• A.Analytical review of BKY ' s financial statements is the best way to uncover small frauds that might be missed by other detection methods.
• B.Fraud audit procedures should be designed to avoid an element of surprise.
• C.Auditors should avoid asking questions such as, " Has anyone ever asked you to do something unethical? " as part of their audits, as this can limit employees ' willingness to communicate.
• D.Fraud assessment questioning techniques are most effectively used as part of the normal audit process.

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