CCT 572 Week 4 Midterm All Questions
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Question 1. Question : (TCO A) An example of a vendor committing fraud by itself is
an overcharge for purchased goods.
the shipment of inferior goods.
nonshipment of goods even though payment is made.
All of the above
Instructor Explanation:
Points Received: 5 of 5
Comments:
Question 2. Question : (TCO A) The fraud triangle includes all of the following except for
validation.
perceived opportunity.
rationalization.
perceived pressure.
Instructor Explanation:
Points Received: 5 of 5
Comments:
Question 3. Question : (TCO A) The last step in the “fraud savvy” model for dealing with fraud includes follow-up. What is a likely outcome when a company allows perpetrators to go unprosecuted?
The company will avoid bad publicity.
The perpetrator and others in the company will commit fraud again in the future.
The perpetrator will be saved from pain and embarrassment and, having learned his or her lesson, will not commit fraud again.
Management will send a signal that fraud will not be tolerated.
Instructor Explanation:
Points Received: 5 of 5
Comments:
Question 4. Question : (TCO B) Even with the best possible internal control system in place, effectiveness still depends on what?
Identifying the nature of the risks involved and the losses that could result from these risks
The competency and dependability of the people enforcing it
Also creating an expectation of punishment
All of the above
Instructor Explanation: .
Points Received: 5 of 5
Comments:
Question 5. Question : (TCO D) Which fraud detection method could be considered a shotgun approach?
Data mining
Benford’s law
Deductive fraud detection
Both A and B
Instructor Explanation:
Points Received: 5 of 5
Comments:
Question 6. Question : (TCO E) Evidence gathered from searching through someone’s trash
can help identify concealment attempts.
can help to determine how a perpetrator is spending stolen money.
can help understand how a perpetrator is stealing money.
All of the above
Instructor Explanation:
Points Received: 5 of 5
Comments:
Question 7. Question : (TCO E) Calibration is
the use of interpersonal space to convey meaning.
the process of observing behavior before questioning begins.
the strongest response to a threatened ego.
the weakest response to a threatened ego.
Instructor Explanation:
Points Received: 5 of 5
Comments:
Question 8. Question : (TCO E) Which will result in the worst interviewing results?
Taking notes during the interview
Interviewing the suspect before enough information is collected
Being sympathetic in the interview
Using technical jargon
Instructor Explanation:
Points Received: 5 of 5
Comments:
Question 9. Question : TCO (E) Documents are often the incriminating evidence for fraud. Which should be used when ensuring that the documents are legitimate and accessible for trial?
Photographing the evidence
Digitally enhancing the evidence
Marking the evidence
Preserving the evidence in a nontransparent container
Instructor Explanation:
Points Received: 5 of 5
Comments:
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Question 1. Question : (TCO B) How has the Sarbanes-Oxley Act’s impact and the Securities and Exchange Commission’s mandate to the PCAOB (Public Company Accounting Oversight Board) established higher standards for corporate governance and accountability? Discuss at least three of the provisions of the Sarbanes-Oxley Act and the responsibilities managers and auditors have under these acts to improve corporate governance and for the implementation of improved internal controls.
Please be thorough in your response.
Student Answer:
Points Received: 25 of 25
Comments:
Question 2. Question : (TCO C) Last year, RTL Corporation’s internal auditors uncovered a $5 million fraud that had been going on for the last 4 years. Jack McCormick, CEO of RTL, recently fired his CFO because he was responsible for the $5 million fraud. Jack wants to make sure that another fraud of this magnitude doesn’t occur again. Jack has asked you, his new CFO, to devise a plan that can be used to help prevent fraud from recurring in the future.
Include at least four recommendations, and list the benefits that are associated with each proposed idea in the plan.
Student Answer:
Instructor Explanation: T
Points Received: 25 of 25
Comments:
Question 3. Question : (TCO A) Read the following scenario. List the elements of the fraud triangle, and use this scenario to provide examples of each element.
Mike Peel, 55, supported himself by conning innocent people with various get-rich-quick schemes. But now, his luck has run out. He went to the neighborhood church known for its generosity to those in need. He told Father Joseph Mehan, the pastor, that his life was in danger because he owed $30,000 to loan sharks. Mike assured Father Mehan that he was turning his life around and was looking for a fresh start. Father Mehan paid off Mikes debt. Mike told Father Mehan that he could not pay him back right away but that he would get the church a great investment through a friend. Father Mehan kept sending money to Mike for investment purposes, totalling tens of thousands of dollars, until last December, when the priest tried to withdraw $25,000 in cash from a parish account. Mike had taken one of the checks that the priest had given to him and had altered the amount from $5,000 to $50,000, leaving no money in the parish account. Mike got caught, and he admitted to taking thousands of dollars in church money by falsely promising he would invest itbut then lost it all gambling.
Student Answer:
Instructor Explanation:
Points Received: 25 of 25
Comments: Great answer!
Question 4. Question : (TCO D) A former classmate from your college, now the CFO of a small manufacturing company, calls you with a revelation: “I suspect fraud in my company,” he states bluntly. “I’d like to conduct some technology-based fraud detection methods, but I don’t know where to start. I remember you took a fraud class back in grad schoolcan you help me out?”
Describe three methods your friend can use, listing pros and cons for each.
Instructor Explanation:
Points Received: 25 of 25
Comments: Great answer!
Question 5. Question : (TCO E) Place the phases of reaction to crisis in sequential order.
Anger
Depression
Acceptance
Denial
Rationalization