CA CA Forensic Accounting & Fraud Detection

Question 1

What is the primary purpose of forensic accounting?

Accepted Answer

To investigate financial fraud and disputes for legal proceedings

Answer

To prepare corporate tax returns

Answer

To audit publicly traded financial statements

Answer

To manage corporate budgets and forecasts

Question 2

Which fraud scheme involves recording fictitious revenues to inflate a company's financial results?

Accepted Answer

Financial statement fraud

Answer

Skimming

Answer

Lapping

Answer

Expense reimbursement fraud

Question 3

The 'fraud triangle' consists of pressure, opportunity, and which third element?

Accepted Answer

Rationalization

Answer

Capability

Answer

Intent

Answer

Access

Question 4

What is 'skimming' in the context of occupational fraud?

Accepted Answer

Taking cash before it is recorded in the accounting system

Answer

Stealing from petty cash after it has been recorded

Answer

Falsifying employee expense reports

Answer

Creating fictitious vendor invoices

Question 5

Which document is most commonly used by forensic accountants to trace the full history of financial transactions?

Accepted Answer

General ledger

Answer

Balance sheet

Answer

Bank reconciliation statement

Answer

Trial balance

Question 6

What is 'lapping' in the context of accounts receivable fraud?

Accepted Answer

Stealing a customer payment and covering it with a later payment from another customer

Answer

Writing off customer balances without authorization

Answer

Recording payments twice in the ledger

Answer

Overstating accounts receivable balances at period-end