Fraud Prevention and Internal Controls Flashcards
6 cards from real CB practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Fraud Prevention and Internal Controls flashcards as text
Which of the following is the primary objective of internal controls?
Answer: To safeguard assets and prevent fraud
Internal controls are designed to safeguard assets, ensure accurate financial reporting, and prevent fraud within an organization.
Which of the following is an example of an internal control measure?
Answer: Implementing segregation of duties
Segregation of duties helps prevent fraud by ensuring that no single individual has complete control over financial transactions.
Which of the following best describes fraud?
Answer: An intentional act of deception for financial gain
Fraud is an intentional act of deception intended to gain an unfair or unlawful advantage, such as financial gain.
What is the purpose of a bank reconciliation?
Answer: To ensure records match the bank statement
A bank reconciliation ensures that an organization's records match the bank statement, detecting errors and unauthorized transactions.
Which of the following is a red flag for potential fraud?
Answer: A lack of segregation of duties
A lack of segregation of duties can create an opportunity for fraud, as it allows one person to manipulate financial records without oversight.
What is one way to reduce the risk of financial fraud in an organization?
Answer: Conducting regular audits and reviews
Conducting regular audits helps identify discrepancies, detect fraud, and ensure compliance with internal controls.