CFE Fraud Prevention Programs 2

Question 1

Which element is most critical when establishing a tone at the top for fraud prevention?

Accepted Answer

Senior management visibly modeling ethical behavior

Answer

Tone at the top requires senior leaders to demonstrably model the ethical conduct they expect, as employees take behavioral cues from leadership.

Question 2

A hotline caller reports suspicion that a manager is falsifying expense reports. What should the organization do FIRST?

Accepted Answer

Conduct a preliminary assessment to determine if further investigation is warranted

Answer

A preliminary assessment determines whether the allegation has sufficient merit to warrant a full investigation before taking action.

Question 3

What is the primary goal of job rotation policies in fraud prevention?

Accepted Answer

To limit the opportunity for any single employee to conceal fraudulent activity

Answer

Job rotation disrupts long-standing collusion opportunities and makes it harder for employees to perpetuate concealed fraud schemes over time.

Question 4

According to the ACFE, approximately what percentage of occupational frauds are detected by tips?

Accepted Answer

About 43%

Answer

ACFE research consistently shows tips are the most common fraud detection method, accounting for roughly 43% of detected cases.

Question 5

Which type of control is MOST effective at preventing procurement fraud before it occurs?

Accepted Answer

Mandatory dual approval for purchase orders above a set threshold

Answer

Requiring dual authorization for purchases above a threshold is a preventive control that stops unauthorized transactions before payment is made.

Certified Fraud Examiner Exam Practice Test