Fraud Investigation Quiz 8

Which of the following statements best describes financial statements?

• Informal records of the financial activities and position of a business, person, or other entity.

• Formal records of the business activities and position of a person, or other entity.

• Formal records of the financial activities and position of a business, person, or other entity.

• Informal records of the business activities and position of a person, or other entity.

Who are the persons that may be involved in fraudulent financial statement schemes?

• Senior management

• Mid/lower level employees

• Organized criminal

• Senior citizen

The potential users of financial statements are below, EXCEPT?

• Investors

• Baker

• Vendors

• Government

There is no surveillance system, such as CCTV installed at your company. Hence, the employees tend to commit fraud. As a manager, what would you do to prevent your employees from committing fraud?

• Provide bonus to your employees

• Establish electronic security system

• Enforce the policy

• Provide training

Miss Farah, an auditor, found out that events conducted by Company X show an unreasonable amount spent. Based on the situation above, what kind of fraud symptom is shown?

• Accounting Anomalies

• Weak Internal Controls

• Analytical Anomalies

• Extravagant Lifestyle

Which of the below best describes extravagant lifestyle symptoms?

• Employees whose regular expenses are in excess of their known income.

• Fake medical bills being submitted for several employees by 22 'doctors' who had the same two addresses.

• The procurement documents were prepared and authorised by the same person

• The purchase expenses are high during the year however there is a reduction in payable accounts.

During the audit, the accountant was unable to provide most of the documents requested. To which symptom is this referring?

• Accounting anomalies

• Weak internal controls

• Analytical anomalies

• Extravagant lifestyle

Which of the following is NOT included in internal control weakness?

• Lack of segregation of duties

• Lack of physical safeguards

• Lack of proper authorization

• Lack of employees

There is no surveillance system, such as CCTV installed at the workplace. Hence, workers tend to commit fraud. This indicates what type of fraud symptom?

• Accounting Anomalies

• Weak Internal Controls

• Analytical Anomalies

• Extravagant Lifestyle