CFS Fraud Prevention & Detection 2

Question 1

Which control best prevents a single employee from both approving and processing a payment?

Accepted Answer

Dual authorization

Answer

Dual authorization requires a second person to approve transactions, enforcing segregation of duties.

Question 2

A company notices that expense reports submitted on Fridays are rarely reviewed. This represents which type of fraud opportunity?

Accepted Answer

Control gap exploitation

Answer

Exploiting predictable review gaps (like end-of-week reduced oversight) is a classic control gap exploitation tactic.

Question 3

Which analytical technique flags transactions that fall just below an approval threshold repeatedly?

Accepted Answer

Threshold circumvention detection

Answer

Threshold circumvention detection identifies patterns where amounts cluster just below approval limits, a common fraud indicator.

Question 4

A vendor master file that is rarely reviewed creates the greatest risk of which scheme?

Accepted Answer

Ghost vendor fraud

Answer

Unreviewed vendor master files allow fictitious vendors to remain active and receive fraudulent payments.

Question 5

Which fraud detection method involves comparing employee addresses against vendor addresses in the system?

Accepted Answer

Data matching

Answer

Data matching cross-references records to identify conflicts of interest, such as employees operating undisclosed vendor companies.

(CFS) Certified Fraud Specialist Practice Test