Acc574 Forensics Accounting: Week 1 Homework ES - An Introduction to the Fraud Environment

Acc574 Forensics Accounting
Week 1 : An Introduction to the Fraud Environment - Homework ES

1. (TCO A) An AICPA committee in 1986 broke forensic accounting into two broad areas: (Points : 2)
Damages and valuation.
Investigative accounting and litigation support.
Accounting and valuation.
Accounting and general consulting.
None of the above

2. (TCO A) Peremptory refers to: (Points : 2)
Be there first.
Not requiring any cause to be shown.
One who strives to be the best.
Take the place of.
None of the above

3. (TCO A) Which of the following is not included in a forensic accountant's knowledge base? (Points : 2)
Computer science
Criminology
Accounting
Law
All of the above are included

4. (TCO A) Which would not be useful in searching for hidden assets? (Points : 2)
Looking at lifestyles of major players
Computing industry ratios
Comparing cash flow with income
Using the net worth method
None of the above

5. (TCO A) COSO defines "internal controls" as a process, effected by an entity's board of directors, management, and other personnel, designed to provide reasonable assurance regarding the achievement of objectives in the following categories except: (Points : 2)
A reasonable degree of transparency.
Effectiveness and efficiency of operations.
Reliability of financial reporting.
Compliance with applicable laws and regulations.
All of the above

6. (TCO A) Which is not one of the classic "red flags" of "cooking the books?" (Points : 2)
Double billing a customer
Personal expenses paid with company funds
Sudden raises or bonuses to employees
Unnecessary use of collection services
Income increasing faster than cash

7. (TCO A) Which would be a preventive control? (Points : 2)
Segregation of duties
Reconciliations
Surprise cash count
Surprise inventory count
All of the above

8. (TCO A) If an internal auditor finds fraud, what communication step should not be taken? (Points : 2)
Notify management or the Board of Directors.
A written report should be prepared.
Draft of written report should be submitted to legal counsel for review.
Report the offense to the appropriate authority.
None of the above

9. (TCO A) Monitoring controls do not include: (Points : 2)
Management reports that identify nonconforming transactions.
Monitoring the system of internal control through internal audit activities.
The preparation of an audit by a licensed CPA firm.
A company's ethics policy signed by all company employees and executives.
None of the above

10. (TCO A) Which would not be considered an analytical procedure? (Points : 2)
Comparison with other operating information
Vertical analysis
Variance analysis
Ratio analysis
All of above are analytical procedures
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