CIA CIA Fraud Examination & Prevention 1

Question 1

According to the fraud triangle, which of the following is NOT one of the three elements that contribute to fraudulent behavior?

Accepted Answer

Greed

Answer

The fraud triangle consists of pressure, rationalization, and opportunity — greed is not a recognized element of the model.

Question 2

Which type of fraud involves an employee creating fictitious vendors and submitting false invoices for payment?

Accepted Answer

Ghost vendor scheme

Answer

A ghost vendor scheme involves setting up fictitious vendors in the accounts payable system to divert company funds to the fraudster.

Question 3

The Association of Certified Fraud Examiners (ACFE) Report to the Nations identifies which category as causing the greatest median loss per case?

Accepted Answer

Financial statement fraud

Answer

Financial statement fraud, while less frequent than other schemes, causes the greatest median loss per case according to ACFE data.

Question 4

Which internal control is most effective at preventing check tampering fraud?

Accepted Answer

Dual authorization for check issuance

Answer

Dual authorization (requiring two approvers) prevents a single employee from issuing unauthorized checks without accomplice involvement.

Question 5

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

Accepted Answer

Using one customer's payment to cover a stolen prior payment

Answer

Lapping involves stealing a customer's payment and then covering it with a subsequent customer's payment, creating a rolling shortage.

CIA - Certified Internal Accountant Practice Test