Certified Fraud Examiner -Fraud Schemes and Financial Crimes (CFE-Fraud-Schemes-and-Financial-Crimes) Free Practice Test

Question 1

According to Marshall, ______ are probable future economic benefits obtained or controlled by a particular entity as a result of past transactions or events.

A. Liabilities

B. None of the above

C. Assets

D. Credentials

Correct Answer: C

Explanation: Only visible for TestSimulate members. You can sign-up / login (it's free).

Question 2

Which of the following statements describes a best practice for preventing procurement fraud?

A. Companies should assign the responsibility of approving invoice payments to the person who maintains the vendor master file so discrepancies can be better identified.

B. Companies should limit comprehensive audits of procurement activities to once a year to create a consistent data point for comparison from one year to the next.

C. Companies should conduct background checks on vendors after they have been added to the company's vendor master file.

D. Companies should implement vendor-monitoring procedures that address the red flags of the vendor schemes that pose the greatest risk.

Correct Answer: D

Explanation: Only visible for TestSimulate members. You can sign-up / login (it's free).

Question 3

Inventory shrinkage is the unaccounted-for reduction in the company's inventory that does not result from theft.

A. False

B. True

Correct Answer: A

Explanation: Only visible for TestSimulate members. You can sign-up / login (it's free).

Question 4

To detect fraud committed by a health care provider, a fraud examiner should look for which of the following red flags?

A. The provider creates medical records for a patient during or soon after the patient's visit.

B. The provider has submitted a higher-than-average number of claims for reimbursement.

C. The provider maintains a consistently low percentage of coding outliers in its documentation.

D. The provider can produce a large amount of supporting documentation for claims under review.

Correct Answer: B

Explanation: Only visible for TestSimulate members. You can sign-up / login (it's free).

Question 5

Revenue is recognized when it is:

A. Fictitious and Earned

B. Realized and Earned

C. All of the above

D. Realized and Evidenced

Correct Answer: B

Explanation: Only visible for TestSimulate members. You can sign-up / login (it's free).

Question 6

A fraudster uses the name and picture of another individual to create a social media profile. This scheme can BEST be described as:

A. Traditional identity theft

B. Criminal identity theft

C. Synthetic identity theft

D. New account identity theft

Correct Answer: A

Explanation: Only visible for TestSimulate members. You can sign-up / login (it's free).

Question 7

A fraudster poses as ABC Organization's chief executive officer (CEO) and sends an email to an employee requesting that company funds be transferred to an account that the fraudster owns. This is an example of which of the following types of fraud schemes?

A. Electronic piggybacking

B. Executive email attack

C. Business email compromise

D. Reverse social engineering

Correct Answer: C

Explanation: Only visible for TestSimulate members. You can sign-up / login (it's free).

Question 8

By what accountant means that the financial figures presented by the company are at least as much as reflected in the statements, if not more.

A. Conservatism

B. Fraudulent statement

C. Misappropriations

D. Matching

Correct Answer: A

Explanation: Only visible for TestSimulate members. You can sign-up / login (it's free).

Question 9

Otto, a bank manager, purchases a new boat that he cannot afford. Knowing that one of the bank customers is an older client who does not regularly check their account, Otto takes money from the customer's account to make his boat payments. To conceal the missing amount, Otto adjusts the bank's general ledger. Which of the following BEST describes Otto's scheme?

A. Unauthorized disbursement of funds

B. False accounting entry

C. Unauthorized withdrawal

D. Moving money from dormant accounts

Correct Answer: B

Explanation: Only visible for TestSimulate members. You can sign-up / login (it's free).

Question 10

Which of the following measures would be MOST EFFECTIVE in preventing a skimming scheme?

A. Reviewing the amount of time between when cash is initially received and deposited

B. Separating the duties of collecting cash and accessing the accounts receivable journal

C. Comparing sales records to the amount of cash that is received

D. Implementing regular rotation of employee job responsibilities

Correct Answer: B

Explanation: Only visible for TestSimulate members. You can sign-up / login (it's free).

Welcome to TestSimulate

ACFE Certified Fraud Examiner -Fraud Schemes and Financial Crimes (CFE-Fraud-Schemes-and-Financial-Crimes) Free Practice Test