CrFA Fraud Examination & Financial Investigations? 2

Question 1

Which indirect method of proving income compares a subject's assets, liabilities, and living expenses at the start and end of a period?

Accepted Answer

Net worth method

Answer

The net worth method estimates unreported income from the increase in net worth plus living expenses, minus known income.

Question 2

In the fraud triangle, which element is the one the organization can most directly reduce?

Accepted Answer

Opportunity

Answer

Internal controls mainly reduce the opportunity to commit fraud and hide it.

Question 3

An employee writes off a customer's account as uncollectible and keeps the customer's later payment. This scheme is best classified as:

Accepted Answer

Skimming concealed through a false write-off

Answer

The employee takes receivables payments before they are recorded and hides the theft by writing off the account.

Question 4

During a fraud examination, which interview is generally conducted LAST?

Accepted Answer

The primary suspect

Answer

Examiners usually interview the suspect last, once enough evidence has been gathered to put to them.

Question 5

An admission-seeking interview should normally begin with:

Accepted Answer

A direct accusation stated with confidence

Answer

Admission-seeking interviews open with a direct accusation, which signals that the examiner is confident.

CrFA - Certified Forensic Accountant Practice Test