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ACFE CFE-Fraud-Prevention Exam Syllabus Topics:

Section	Weight	Objectives
Internal Controls and Fraud Prevention	25%	- Fraud detection and prevention controls - Internal control design and effectiveness
Fraud Risk Management and Deterrence	25%	- Monitoring and continuous improvement - Fraud prevention strategies and programs
Fraud Prevention Framework	25%	- Fraud risk assessment processes - Fraud risk governance and oversight
Corporate Governance and Ethics	25%	- Ethical culture and tone at the top - Code of conduct and compliance programs

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ACFE Certified Fraud Examiner - Fraud Prevention and Deterrence Exam Sample Questions (Q45-Q50):

NEW QUESTION # 45
Which of the following is one of the four recommendations made by the National Commission on Fraudulent Financial Reporting the Treadway Commission to reduce the probability of fraud in financial reports?

A. Have adequate audit committee resources and authority.
B. Give shareholders oversight of internal controls.
C. Have a mandatory independent compensation committee.
D. Develop a written charter for management.

Answer: A

Explanation:
The Corporate Governance chapter explains that the Treadway Commission made four recommendations aimed at reducing the likelihood of fraud in financial reporting. These recommendations were directed to the board of directors' audit committee and included having an independent audit committee, a written charter for the audit committee, adequate resources and authority, and informed, vigilant, and effective audit committee members. The manual specifically states that the existence of an audit committee and a written charter is not enough; the committee must also have adequate resources and authority to carry out its responsibilities. That language directly matches option C. The other choices either substitute the wrong committee, assign the charter to management instead of the audit committee, or improperly shift oversight of internal controls to shareholders.

NEW QUESTION # 46
Which of the following is NOT a purpose served by a professional organization's code of conduct?

A. It replaces the need for individuals to consult their own conscience.
B. It serves as a reference and benchmark for ethical guidance
C. It facilitates practical enforcement and profession-wide Internal discipline.
D. It provides more direct solutions to professional ethical dilemmas than might exist under general ethical principles

Answer: A

Explanation:
A professional code of conduct serves as a guideline for ethical behavior, provides benchmarks for decision-making, and facilitates enforcement within the profession.
It does not replace the personal responsibility to exercise individual judgment and consult one's conscience.

NEW QUESTION # 47
Which of the following is TRUE regarding corporate governance?

A. Effective corporate governance practices are most necessary in an organization in which the owners are also the individuals responsible for setting the corporate strategy.
B. An entity's corporate governance structure specifies the distribution of rights and responsibilities among the different participants in the organization
C. Fraud risk management is considered to be the foundation of effective corporate governance
D. Corporate governance's primary purpose is to ensure the accuracy of the organization's financial reports

Answer: B

Explanation:
Definition of Corporate Governance:
Corporate governance establishes the framework for decision-making and accountability within an organization. It includes roles, rights, and responsibilities of stakeholders such as the board, management, and shareholders.
Why D is Correct:
The governance structure formalizes the distribution of roles and ensures clarity in accountability and oversight.

NEW QUESTION # 48
Charles, the chief executive officer (CEO) of the Baking & Things Corporation, hired Daniela, a Certified Fraud Examiner (CFE), to investigate an embezzlement case. During the investigation, Daniela learns that Charles is involved in an unrelated fraud. What action should Daniela take based on the ACFE Code of Professional Ethics?

A. Daniela should immediately resign from the engagement.
B. Daniela should report Charles to law enforcement.
C. Daniela should contact the media to report what she found.
D. Daniela should tell the company's board of directors about Charles.

Answer: D

NEW QUESTION # 49
Which of the following statements Is TRUE regarding how fraud examiners should exercise professional skepticism during a fraud examination engagement?

A. Fraud examiners should not relax their skeptical attitudes under any circumstances.
B. Fraud examiners should form the engagement hypothesis without regard to the nature of the assignment
C. Professional skepticism involves maintaining a mindset that no fraud has occurred
D. Professional skepticism can be dispelled only by evidence

Answer: D

Explanation:
Definition of Professional Skepticism:
Professional skepticism requires maintaining a questioning mindset and critically assessing evidence throughout the fraud examination process.
Why D is Correct:
Professional skepticism ensures that fraud examiners remain vigilant and rely on evidence to conclude whether fraud has occurred or not. It is dispelled only when sufficient evidence supports a clear conclusion.

NEW QUESTION # 50
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