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ACFE Certified Fraud Examiner - Fraud Prevention and Deterrence Exam Sample Questions (Q88-Q93):

NEW QUESTION # 88
Jody has been working at ABC Corp. for ten years. He steals funds from the company and tells himself that the company owes it to him for his "unrewarded hard work and loyalty" This situation BEST illustrates which leg of the Fraud Triangle?

A. Lack of personal Integrity
B. Rationalization
C. Perceived non-shareable financial need
D. Perceived opportunity

Answer: B

NEW QUESTION # 89
Which of the following statements regarding recommended vendor due diligence procedures is MOST ACCURATE?

A. An organization should ensure that vendors have their own ethics and compliance program before engaging in any transactions with them.
B. An organization should perform audits of potential vendors before agreeing to conduct business with them.
C. An organization should avoid revealing that it is seeking information about potential vendors prior to starting its relationship with them.
D. An organization should request that new vendors complete a questionnaire about their background immediately after signing a contract with them.

Answer: A

Explanation:
Comprehensive and Detailed in Depth Explanation:
A key element of vendor due diligence is ensuring that third-party vendors have robust ethics and compliance programs. This helps align values, mitigate fraud risks, and establish clear expectations. While audits and questionnaires are good practices, they are not always mandatory or feasible before engagement. Moreover, transparency in seeking vendor information (unlike in A) is a norm in legitimate vetting practices.
Reference:Fraud Examiners Manual, 2022, Fraud Prevention and Deterrence, Managing Third-Party Fraud Risks - Section 4.809.

NEW QUESTION # 90
The existence of many specialized departments within a company generally decreases the overall risk of fraud within the organization

A. False
B. True

Answer: B

NEW QUESTION # 91
According to Diane Vaughan. which of the following factors increases an organization s inherent inclination toward committing crime?

A. Management links employee performance goals with company performance goals
B. All of the above
C. Rewards are given to employees who challenge the status quo
D. Management seeks out diversity in attitudes and perspectives when hiring employees

Answer: C

NEW QUESTION # 92
The internal auditor's fraud-related responsibilities include which of the following?

A. Establishing and maintaining effective anti-fraud controls at a reasonable cost
B. Overseeing management's actions to manage fraud risks
C. Obtaining reasonable assurance that the organization's financial statements are free of material misstatements caused by fraud
D. Evaluating indicators of fraud and deciding whether any further action is necessary or whether an investigation should be recommended

Answer: D

Explanation:
* Internal Auditor's Role in Fraud Risk Management:
* Internal auditors are not directly responsible for establishing or maintaining anti-fraud controls (Option D). This responsibility lies with management.
* They are also not responsible for obtaining reasonable assurance that financial statements are free of fraud (Option A). This is the role of external auditors.
* Oversight of management's fraud risk actions (Option B) is primarily a governance role, not the auditor's direct responsibility.
* Internal auditors focus on identifying and assessing fraud risks, evaluating controls, and recommending further action when necessary.
* Conclusion:Option C aligns with the internal auditor's responsibilities as per the standards outlined in the ACFE's fraud risk management framework.
References:ACFE documentation on internal auditing responsibilities and fraud risk assessments.

NEW QUESTION # 93
......

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