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ACFE CFE-Fraud-Prevention Exam Syllabus Topics:

Section	Weight	Objectives
Topic 1: Corporate Governance and Ethics	25%	- Code of conduct and compliance programs - Ethical culture and tone at the top
Topic 2: Fraud Risk Management and Deterrence	25%	- Fraud prevention strategies and programs - Monitoring and continuous improvement
Topic 3: Internal Controls and Fraud Prevention	25%	- Internal control design and effectiveness - Fraud detection and prevention controls
Topic 4: Fraud Prevention Framework	25%	- Fraud risk governance and oversight - Fraud risk assessment processes

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ACFE Certified Fraud Examiner - Fraud Prevention and Deterrence Exam Sample Questions (Q194-Q199):

NEW QUESTION # 194
During an external audit, the audit team identifies evidence that management has Intentionally manipulated the organization's reported revenue amount However, the amount of the resulting misstatement does not meet the quantitative materiality threshold for the audit. Which of the following is TRUE regarding this situation?

A. The auditors should assume that all audit evidence collected previously is unreliable and withdraw from the audit engagement.
B. The auditors should regard the misstatement as immatenal to the audit because the omitted amount is less than the quantitative materiality threshold
C. The auditors should only consider the evidence if they can determine that the actions meet the legal definition of fraud.
D. The auditors should reconsider the reliability of the audit evidence they have previously obtained.

Answer: D

Explanation:
Implications of Management Manipulation:
Intentional manipulation, even if quantitatively immaterial, raises concerns about the reliability of management representations and the integrity of audit evidence.
Why Option A is Correct:
Reassessing the reliability of previously obtained evidence ensures that the auditors address potential biases or systemic issues arising from management's actions.

NEW QUESTION # 195
A company implements mandatory job rotation within its accounting department. What fraud risk benefit does this provide?

A. It eliminates all payroll fraud
B. It helps expose irregularities when duties change hands
C. It discourages independent review
D. It increases opportunities for concealment

Answer: B

Explanation:
Many fraud schemes require continuous control by the perpetrator. Job rotation introduces fresh oversight and increases the chance that unusual transactions, missing documentation, or manipulated records will be discovered.

NEW QUESTION # 196
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?

A. Josie should not disclose her findings to anyone until after she has conducted a full investigation.
B. Josie should confront Carissa with her audit findings and try to get a confession.
C. Josie should report her findings to those charged with governance of the organization.
D. Josie should immediately report her findings to the local media.

Answer: C

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 # 197
Management at ABC Corp. is assessing the company's ethical tone and how it affects the organization's fraud risk. To most effectively reinforce an anti-fraud culture, management should:

A. All of the above
B. implement two separate sets of ethics policies, one for management and one for employees
C. Use a checklist of initiatives to make sure all the elements of a strong tone at the top are in place
D. Create an environment in which employees feel safe challenging management's decisions

Answer: D

Explanation:
Safe environment for challenges: This is the most effective method as it promotes transparency, accountability, and whistleblowing.

NEW QUESTION # 198
Which of the following is BEST classified as a type of external fraud risk?

A. Collusion between contractors
B. Reporting revenue in the wrong period
C. Embezzling incoming customer payments
D. Adding ghost employees to payroll

Answer: A

Explanation:
Collusion between contractors is an example of external fraud risk because it involves external parties conspiring to defraud the organization. The other options describe internal fraud risks, such as actions committed by employees within the organization.

NEW QUESTION # 199
......

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