Forensic Accounting Quiz

Which historical case directly influenced the creation of the Securities Exchange Act of 1934?

• South Sea Bubble

• Samuel Insull fraud

• Ivar Kreuger “Match King” fraud

• Charles Ponzi scheme

What is the final step in the fraud investigation process according to the slides?

• Interviewing suspects

• Developing a fraud theory

• Communicating with appropriate parties

• Gathering all related documents

Which of the following is *not* part of the COSO framework for internal control?

• Control environment

• Control awareness

• Monitoring

• Risk assessment

What role does a forensic accountant play after an allegation has surfaced?

• Preparing financial statements

• Providing tax advice

• Investigating financial evidence and testifying in court

• Assisting auditors in routine audits

According to SOX, which of the following became a key responsibility of the audit committee?

• Budget approvals

• Staff promotions

• Oversight of antifraud programs

• Day-to-day operations

Which best describes the fraud cycle’s *initial* trigger?

• Audit result

• Fraudster’s planning

• Court investigation

• Financial misstatement

Which of the following is unique to forensic accounting compared to regular auditing?

• Use of GAAS

• Professional skepticism

• Independent calculation of financial impact

• Expressing opinion on financial statements

What type of relationship is characteristic of fraud auditing?

• Friendly

• Adversarial

• Independent

• Non-adversarial

What presumption do auditors operate under according to GAAS?

• Innocence until proven guilty

• Legal proof

• Professional skepticism

• Objective neutrality

Which case from 1920 involved arbitraging international postal coupons?

• South Sea Bubble

• Samuel Insull

• Charles Ponzi

• Meyer v. Sefton