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[Show more]In the past (early 20th century time-frame), what was the general consensus of the principal 
purpose of audits (including among auditors)? 
To detect fraud 
To certify for the public that management is qualified to run the entity 
To evaluate that companies follow GAAP 
Investigative and analytical...
Preview 4 out of 96 pages
Add to cartIn the past (early 20th century time-frame), what was the general consensus of the principal 
purpose of audits (including among auditors)? 
To detect fraud 
To certify for the public that management is qualified to run the entity 
To evaluate that companies follow GAAP 
Investigative and analytical...
Which action is potentially unethical because it understates COGS? 
A. Understating purchases 
B. Understating purchase returns 
C. Understating ending inventory 
D. Understating purchase discounts - A 
Why is it unethical for a supervisor to ask an accountant to capitalize the marketing research 
p...
Preview 3 out of 16 pages
Add to cartWhich action is potentially unethical because it understates COGS? 
A. Understating purchases 
B. Understating purchase returns 
C. Understating ending inventory 
D. Understating purchase discounts - A 
Why is it unethical for a supervisor to ask an accountant to capitalize the marketing research 
p...
America's capital markets are the envy of the world because of their efficiency, liquidity, and 
resiliency. What role do financial statements play in American capital markets? - They 
present a fair picture of the financial position and results of the organization 
Why are American financial state...
Preview 1 out of 4 pages
Add to cartAmerica's capital markets are the envy of the world because of their efficiency, liquidity, and 
resiliency. What role do financial statements play in American capital markets? - They 
present a fair picture of the financial position and results of the organization 
Why are American financial state...
Perpetrator- Management of a company 
Victim- Shareholders and/or debt-holders and regulators 
Most expensive type of fraud - Management Statement fraud 
Which legal code makes the bribing of public officials illegal? - Title 18, US. Code Section 
201 
Perpetrator- Customers of an organization 
Vict...
Preview 2 out of 9 pages
Add to cartPerpetrator- Management of a company 
Victim- Shareholders and/or debt-holders and regulators 
Most expensive type of fraud - Management Statement fraud 
Which legal code makes the bribing of public officials illegal? - Title 18, US. Code Section 
201 
Perpetrator- Customers of an organization 
Vict...
If _____________ is understated, then ________________ will directly be overstated (less tax 
effect). - Cost of Goods Sold, Net Income 
Cost of goods sold can be understated by overstating ending inventory. 
True or False - True 
There are over 15 ways of manipulating cost of goods sold. To what en...
Preview 1 out of 4 pages
Add to cartIf _____________ is understated, then ________________ will directly be overstated (less tax 
effect). - Cost of Goods Sold, Net Income 
Cost of goods sold can be understated by overstating ending inventory. 
True or False - True 
There are over 15 ways of manipulating cost of goods sold. To what en...
1x sold
Most economists agree that __________ and _________ were the root causes of the economic 
downturn. - - sub-prime mortgages 
- other risky financial instruments 
Financial statements prepared by organizations play an important role in keeping America's 
markets efficient, what do financial statemen...
Preview 3 out of 30 pages
Add to cartMost economists agree that __________ and _________ were the root causes of the economic 
downturn. - - sub-prime mortgages 
- other risky financial instruments 
Financial statements prepared by organizations play an important role in keeping America's 
markets efficient, what do financial statemen...
People will often be dishonest if they are placed in: 
a. An environment with poor controls. 
b. An organizational setting with strict accountability 
c. Positive modeling and labeling. 
d. A positive work environment. - An environment with poor controls. 
Which of the following is not a factor in c...
Preview 2 out of 7 pages
Add to cartPeople will often be dishonest if they are placed in: 
a. An environment with poor controls. 
b. An organizational setting with strict accountability 
c. Positive modeling and labeling. 
d. A positive work environment. - An environment with poor controls. 
Which of the following is not a factor in c...
Which of the following types of frauds are considered the most difficult to find, usually requiring 
a tip? 
a. Overstatement of asset-related financial statement fraud. 
b. Inadequate disclosure financial statement fraud. 
c. Revenue-related financial statement fraud. 
d. Cost of goods sold-related...
Preview 2 out of 6 pages
Add to cartWhich of the following types of frauds are considered the most difficult to find, usually requiring 
a tip? 
a. Overstatement of asset-related financial statement fraud. 
b. Inadequate disclosure financial statement fraud. 
c. Revenue-related financial statement fraud. 
d. Cost of goods sold-related...
According to the financial statement fraud detection framework, fraud is rarely detected by 
which of the following: 
a. Analyzing the financial statements 
b. Understanding the inherent risks of a specific industry 
c. Learning management's motivations 
d. Breaking down and analyzing internal cont...
Preview 2 out of 5 pages
Add to cartAccording to the financial statement fraud detection framework, fraud is rarely detected by 
which of the following: 
a. Analyzing the financial statements 
b. Understanding the inherent risks of a specific industry 
c. Learning management's motivations 
d. Breaking down and analyzing internal cont...
Which are the two most commonly manipulated to perpetrate financial statement fraud? - 
Revenues and Accounts Receivable 
SAS 99 requires auditors to assume there are material misstatements in revenue, though realizing 
there are situation-specific methods to recognize revenue and interpret the asso...
Preview 1 out of 4 pages
Add to cartWhich are the two most commonly manipulated to perpetrate financial statement fraud? - 
Revenues and Accounts Receivable 
SAS 99 requires auditors to assume there are material misstatements in revenue, though realizing 
there are situation-specific methods to recognize revenue and interpret the asso...
In the past (early 20th century time-frame), what was the general consensus of the principal 
purpose of audits (including among auditors)? - To detect fraud 
Why has there been so much frustration between the general public and auditors regarding fraud 
detection? - The public wants all cases of fr...
Preview 2 out of 5 pages
Add to cartIn the past (early 20th century time-frame), what was the general consensus of the principal 
purpose of audits (including among auditors)? - To detect fraud 
Why has there been so much frustration between the general public and auditors regarding fraud 
detection? - The public wants all cases of fr...
Which of the following is a transaction that creates real liabilities for a company? 
a. Co-signing on a loan as a secondary signee. 
b. Collecting cash prior to the performance of a service. 
c. None of the above. - Collecting cash prior to the performance of a service 
When accounts payable-relate...
Preview 2 out of 6 pages
Add to cartWhich of the following is a transaction that creates real liabilities for a company? 
a. Co-signing on a loan as a secondary signee. 
b. Collecting cash prior to the performance of a service. 
c. None of the above. - Collecting cash prior to the performance of a service 
When accounts payable-relate...
With asset-based financial statement frauds, assets are most often: - Overstated 
Which of the following is a way to commit asset fraud? 
a. Overstating fixed assets 
b. Under-recording payroll taxes 
c. Over-recording contingent liabilities 
d. Recording sales discounts too high - Overstating fixed...
Preview 2 out of 6 pages
Add to cartWith asset-based financial statement frauds, assets are most often: - Overstated 
Which of the following is a way to commit asset fraud? 
a. Overstating fixed assets 
b. Under-recording payroll taxes 
c. Over-recording contingent liabilities 
d. Recording sales discounts too high - Overstating fixed...
Section 404 of the Sarbanes-Oxley Act of 2002, provided for increased scrutiny over which area 
of corporate governance: 
a. Internal controls design, implementation and effectiveness. 
b. The COSO framework that was created by the PCAOB to regulate auditor activities. 
c. Audit committees of boards...
Preview 2 out of 8 pages
Add to cartSection 404 of the Sarbanes-Oxley Act of 2002, provided for increased scrutiny over which area 
of corporate governance: 
a. Internal controls design, implementation and effectiveness. 
b. The COSO framework that was created by the PCAOB to regulate auditor activities. 
c. Audit committees of boards...
Which of the following are the four areas of the fraud exposure rectangle - 
Management and Directors 
Relationship with others 
Organization & Industry 
Financial Results & Operational Characteristics 
To detect fraud, symptoms must be not Observed and Recognized - True 
When is a contingent liabi...
Preview 2 out of 7 pages
Add to cartWhich of the following are the four areas of the fraud exposure rectangle - 
Management and Directors 
Relationship with others 
Organization & Industry 
Financial Results & Operational Characteristics 
To detect fraud, symptoms must be not Observed and Recognized - True 
When is a contingent liabi...
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