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| Section | Weight | Objectives |
|---|---|---|
| Fraud Prevention Framework | 25% | - Fraud risk assessment processes - Fraud risk governance and oversight |
| Corporate Governance and Ethics | 25% | - Code of conduct and compliance programs - Ethical culture and tone at the top |
| Fraud Risk Management and Deterrence | 25% | - Monitoring and continuous improvement - Fraud prevention strategies and programs |
| Internal Controls and Fraud Prevention | 25% | - Internal control design and effectiveness - Fraud detection and prevention controls |
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NEW QUESTION # 206
Which of the following is one of the three general methods used to control corporate crime?
Answer: C
NEW QUESTION # 207
Josie is conducting an external audit of a company in a jurisdiction that is subject to International Standards on Auditing (ISAs). While conducting her audit procedures, she discovers evidence that Carissa, the company's chief financial officer, has been fraudulently manipulating the financial statements. Which of the following is Josie's BEST response to these findings?
Answer: A
Explanation:
According to the ISAs, auditors are required to communicate identified instances of fraud to those charged with governance of the organization. This ensures that the appropriate individuals within the organization are informed and can take necessary corrective actions. Reportingfindings to the media or confronting individuals directly is not considered an appropriate course of action.
NEW QUESTION # 208
Having specialized departments within a company often increases the overall risk ot traud by the organization.
Answer: B
Explanation:
Risks Associated with Specialized Departments:
While specialization improves efficiency, it can create silos that hinder communication, coordination, and oversight, increasing fraud risk.
Isolated departments may lack cross-functional checks and balances.
Conclusion: Specialized departments often increase fraud risk if not managed with proper controls and oversight.
NEW QUESTION # 209
The internal auditor's fraud-related responsibilities include which of the following?
Answer: D
NEW QUESTION # 210
Which of the following is FALSE regarding a fraud risk assessment?
Answer: D
Explanation:
Purpose of Fraud Risk Assessment:
The goal is to identify vulnerabilities to fraud and implement preventive measures, not to wait for conclusive evidence of fraud before designating high-risk areas.
Proactive Identification:
High-risk areas are identified based on susceptibility to fraud (e.g., lack of controls, high cash transactions), even if no fraud has been detected. This approach allows organizations to act preemptively.
Improving Fraud Awareness:
Employee education and behavior monitoring are integral components of the assessment process to reduce fraud risks.
Incorrect Assumption in D:
Waiting for conclusive evidence contradicts the proactive nature of fraud risk assessment and undermines its preventative function.
NEW QUESTION # 211
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