ACCTG 432 Ch 3
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15 QuestionsShow answers
  • Question 1
    45 seconds
    Q. Which is not one of the three M's of financial statement fraud?
    answer choices
    Missing general ledger.
    Intentional misapplication.
  • Question 2
    45 seconds
    Q. Which group is not one of the members of corporate governance in the six-legged stool as outlined by Professor Zab Razaee?
    answer choices
    Audit Committee.
    Internal auditors.
    Employees of the company.
  • Question 3
    45 seconds
    Q. Which quality or characteristic is not outlined in Statement of Financial Concepts No. 2?
    answer choices
  • Question 4
    45 seconds
    Q. Which would be an example of the bill-and-hold strategy?
    answer choices
    Books are kept open beyond the appropriate time.
    Sell products and hold them, with an agreement to bill customers later.
    Combine restricted fund account with the general fund account.
    Inflate revenues with phony software sales.
  • Question 5
    45 seconds
    Q. An example of "channel stuffing" would be:
    answer choices
    Keeping books open beyond the appropriate time.
    Combining restricted fund account with the general fund account.
    Booking income before receiving payments.
    Inflating revenues with phony software sales.
  • Question 6
    45 seconds
    Q. Under the KPMG categories of fraud, what would probably not be an employer internal fraud?
    answer choices
    False insurance claims.
    Ghost vendors.
    Check forgery.
    False financial statements.
  • Question 7
    60 seconds
    Q. COSA defines "internal controls" as a process, effected by an entity's board of directors, management and other personnel, designed to provide reasonable assurance regarding the achievement of objectives in the following categories except:
    answer choices
    A reasonable degree of transparency.
    Effectiveness and efficiency of operations.
    Reliability of financial reporting.
    Compliance with applicable laws and regulations.
  • Question 8
    45 seconds
    Q. Which of the following is a red flag for forensic accountants?
    answer choices
    Complex financial products.
     Aggressive revenue recognition policies.
           All of the above
    None of the above
  • Question 9
    45 seconds
    Q. What is an industry conditions risk factor?
    answer choices
    Company in a declining industry.
    Significant accounts based upon estimates.
    Significant related-party transactions.
    Aggressive incentive programs.
  • Question 10
    45 seconds
    Q. What is an operating and financial stability risk factor?
    answer choices
    New accounting requirements for the company.
    Substance over form questions.
    Company declining in the industry.
    High degree of competition.
  • Question 11
    45 seconds
    Q. What is an investigative technique used by the SEC to investigate specific companies for cooking the books?
    answer choices
  • Question 12
    45 seconds
    Q. Elements in the fraud triangle can be restated as all of the following except:
    answer choices
    Individual is either dishonest or able to rationalize theft.
    Notices or creates an opportunity to commit fraud.
    Generally acts alone, out of embarrassment.
    Feels some sort of pressure or incentive to commit fraud.
  • Question 13
    45 seconds
    Q. Which is not one of the classic "red flags" of "cooking the books"?
    answer choices
    Double billing a customer.
    Personal expenses paid with company funds.
    Sudden raises or bonuses to employees.
    Unnecessary use of collection services.
  • Question 14
    30 seconds
    Q. Which would be a good name for the scheme of listing investment income as operating revenue?
    answer choices
    Period shift.
    Expense manipulation.
    Liability trap.
    Revenue trick.
  • Question 15
    30 seconds
    Q. What is an equitable remedy that allows a person to win a dispute against a company that does not have standing to suit?
    answer choices
    Equity doctrine.
    Alter ego.
    Division analysis.
    Dominance doctrine.
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