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ACFE CFE-Fraud-Prevention Exam Syllabus Topics:

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

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ACFE Certified Fraud Examiner - Fraud Prevention and Deterrence Exam Sample Questions (Q251-Q256):

NEW QUESTION # 251
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. Assign oversight of the hotline reporting program to company shareholders
B. Have a mandatory independent finance committee
C. Provide adequate resources and authority to the internal audit function
D. Develop a written charter for the audit committee

Answer: C

Explanation:
The Treadway Commission emphasizes improving internal controls, which include strengthening the internal audit function. Providing adequate resources and authority to the internal audit function ensures that it operates independently and effectively, which is critical for preventing and detecting fraud. The internal audit function can evaluate financial reporting systems, detect irregularities, and provide valuable recommendations for improvement. This recommendation aligns with the goal of reducing fraud and ensuring reliable financial reporting.

NEW QUESTION # 252
Which of the following is the MOST EFFECTIVE way for management to respond to incidents of fraud within an organization?

A. Maintaining a policy that allows employees one warning before they are terminated for committing fraud
B. Emphasizing to all employees that the company maintains a policy of zero tolerance for fraud.
C. Punishing frauds only if they have a significant financial impact.
D. Keeping all known incidents of fraud private to protect the identities of parties involved.

Answer: B

NEW QUESTION # 253
Which of the following is TRUE regarding an organization's ethics program?

A. An ethics program should avoid addressing rewards for ethical behavior and sanctions for unethical behavior
B. Having a written ethics policy is sufficient to communicate management's ethical philosophy and serve as a comprehensive ethics program
C. To be most effective, access to the organization's ethics policy should be restricted to external parties such as vendors and customers
D. In designing the ethics program, management should consider how stakeholders throughout the organization define success

Answer: D

Explanation:
For an ethics program to be effective, management must integrate the organization's ethical principles with the perceptions and expectations of stakeholders. By considering how stakeholders define success,the organization can design an ethics program that aligns with its values and operational goals. This inclusive approach promotes adherence to ethical standards and fosters a positive ethical culture within the organization. Merely having a written policy or restricting access to it does not ensure effectiveness.

NEW QUESTION # 254
According to professional auditing standards, auditors should do which of the following as part of addressing the assessed risks of material misstatement due to fraud in the financial statements?

A. Disregard the entity's selection and application of accounting policies concerning complex transactions
B. All of the above
C. Incorporate an element of predictability in the selection of auditing procedures to be performed
D. Consider the knowledge, skill, and ability levels of the individuals who are assigned significant audit responsibilities

Answer: C

NEW QUESTION # 255
Which of the following criminological theories states that individuals make a conscious decision to commit a crime and that crime can be deterred by reducing opportunities for criminal activity and increasing an individual's personal risk of being caught and punished?

A. Differential association theory
B. Routine activities theory
C. Social conflict theory
D. Rational choice theory

Answer: D

Explanation:
Rational Choice Theory Overview:
This theory posits that individuals consciously weigh the benefits and risks of committing a crime and make calculated decisions to engage in criminal behavior if the perceived benefits outweigh the risks.
Deterrence Mechanism:
Crime can be deterred by reducing opportunities (e.g., strong internal controls) and increasing the likelihood of detection and punishment (e.g., effective monitoring systems).
Why C is Correct:
Rational choice theory explicitly addresses crime prevention through increased risks and reduced opportunities.

NEW QUESTION # 256
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