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Study Resources (Accounting)

Text Review Questions 13-TRQ #1.          What are the different types of corruption schemes? orruption schemes in ACFE studies are broken down into four classifications: Bribery Illegal gratuities Economic extortion Conflicts of interest 13-TRQ #2.          How do bribery and illegal gratuities differ? ribery may be defined as the offering, giving, receiving, or soliciting anything of value to influence an.
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A commission scheme can be detected by: Examining sales return patterns Examining sales over a certain amount Examining sales returns All of the above LO#8 & 9 Mischaracterized expense schemes include: Paying for entertainment of corporate clients Paying for expenses incurred on behalf of your employees Paying for expenses from an account you control All of the above Alteration of expenses.
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Multiple Choice 15-M/C #1.           CPAs may provide consulting services that are concerned with fraud but are not necessarily fraud examination services, auditing, or litigation support services. These might include all EXCEPT: Assessing the risk of fraud and illegal acts Performing bookkeeping services for the client Evaluating the adequacy of internal control systems Preparing company codes.
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14-M/C #1.           One of the most popular methods of overstating inventory is through: Understating cost of goods sold “Phantom” inventory Overstating sales revenue Overstating inventory obsolescence 14-M/C #2.           Which of the following is NOT a red flag associated with improper disclosures? A strong, independent audit committee Domination of management by a single person or small group Rapid growth.
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14-T/F #1.              The conservatism constraint requires that, when there is any doubt, one should avoid understating assets and income. 14-T/F #2.              Relevance implies that certain information will make a difference in arriving at a decision 14-T/F #3.              Accurate financial statements are the responsibility of company’s external accountants. 14-T/F #4.              Financial statement frauds can.
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Multiple Choice 14-M/C #1.           Which of the following is NOT a valid reason for a senior manager to issue fraudulent financial statements? To conceal true business performance To preserve personal status/control To maximize tax liability To maintain personal income/wealth flowing from salary, bonus, stock and stock options. 14-M/C #2.           Which of the following is NOT one.
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Text Review Questions 15-TRQ #1.          What is the purpose of practice aids in forensic and valuation services? 15-TRQ #2.          What are the different types of consulting and litigation support activities for fraud and forensic professionals? 15-TRQ #3.          What is included as an expert’s work product? 15-TRQ #4.          What must an injured party prove to.
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51.  Consider the following information You are an accountant for both firms and would like to determine whether the impairment loss is material or not. Which of the following statement(s) is/are correct?  A.  The impairment loss for both firms is material. B.  The impairment loss for Manly Ltd is material. C. .
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39.Firms are subject to political costs when: A. They are quite small and have little political influence. B. They choose accounting policies that best reflect the performance of the firm. C. They record high profits and share those profits in the form of increased wages. D. They are highly visible, in the media.
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Multiple Choice 16-M/C #1.           Plaintiffs and victims have a number of possible legal mechanisms available to recover assets either through the civil or criminal justice system with the exception of: Expropriation Freezing orders Judgments Insurance and Bonds 16-M/C #2.           With the ________ Rule, the basis of foundation for the opinion may not be based on “junk.
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47.The Corporations Act requires which of the following statements to be included in a Directors' Declaration? A. whether in their opinion the financial statements comply with accounting standards and the Corporations Act B. whether in their opinion the financial statements give a true and fair view of the financial position and.
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Short Answer Essay 14-SAE #1.           List four steps to reduce the opportunity to commit financial statement fraud. 14-SAE #2.           List four red flags associated with improper disclosure. Critical Thinking Exercise A woman shoots her husband. Then she holds him underwater for over five minutes. Finally, she hangs him. But five minutes later they both.
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15-TRQ #1.          What are the various categories and calculations used in ratio analysis? 15-TRQ #2.          What are some of the decisions that need to be made with regard to quantifying lost revenues and increased expenses? 15-TRQ #3.          How may lost profits be calculated using typical benchmarks? 15-TRQ #4.          What are the considerations related.
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Multiple Choice 13-M/C #1.           Which of the following is not a typical corruption scheme: Economic extortion Expropriation Bribery Conflicts of interest 13-M/C #2.           ________ are similar to bribery schemes, except that something of value is given to an employee to reward a decision rather than influence it. Conflicts of interest Economic extortion Illegal gratuities Expropriation 13-M/C #3.           ________ schemes are committed.
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29.Within the principal/agent perspective of PAT, the price-protection approach is: A. The principal pays the agent a lower salary on the basis that the agent is expected to undertake opportunistic behaviour. B. The contract between the principal and agent includes a clause that stipulates the basis for pricing of goods so.
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15-M/C #1.           The venues where the fraud examiner or forensic accountant can expect to be evaluated, scrutinized, challenged, etc. excludes the following: Deposition testimony FASB Trail testimony Meetings with counsel where they determine how to proceed with the case 15-M/C #2.           Valuations can be developed to address a number of issues. For example, they may.
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13-M/C #1.           A proactive computer audit test to detect when a company has a high incidence of invoice payments below an approval limit that may be reviewable by an audit could include: Stratify vendor payments by approval limits directly under the approval limit Conduct an intensive audit of 100 percent of all.
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An employee intercepts a blank check and forges the treasurer’s signature to conceal that the check is payable to the employee. This is an example of a forged maker.              Obtaining blank checks is unnecessary if the fraudster can produce counterfeit checks. Using an accomplice as the payee is one way to hamper.
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49.Economic interest group theory of regulation adopts the notion that _____________ are considered to dominate the legislative process. A. public interests B. private interests C. shareholders D. debtholders 50.A machine with a carrying amount of $9000 has a net selling price of $8000. The replacement cost of this asset is $10 000 and the.
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In order for a ghost employee scheme to work, the paycheck for the ghost must go to the person involved in the scheme.                                          Falsifying time and attendance data are central to a ghost employee scheme One way to thwart a ghost employee scheme is for someone with no responsibility.
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11.AASB 101 requires the summary of accounting policies adopted by reporting entities to be presented in any section of the notes to the financial report. 12.PAT suggests that agents agree to bonding and monitoring mechanisms to avoid price protection by principals. 13.Creative accounting violates IFRS standards and generally accepted accounting.
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14-TRQ #1.          What are the four criteria necessary for a sale to be complete? 14-TRQ #2.          How can understating liabilities and expenses make a company appear more profitable? 14-TRQ #3.          What issues are generally involved in improper disclosures? 14-TRQ #4.          How may improper asset valuation inflate the current ratio? 14-TRQ #5.          How can financial.
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37.In recent times, the AASB has been reluctant to include alternative options within standards. This means:  A. Entities within Australia will have the choice as to whether or not they choose to meet the requirements detailed in accounting standards. B. The number of options within IFRS-adopted accounting standards is expected.
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57.If a company does not comply with the Australian Securities Exchange Listing Rules, Chapter 3 and 4, it may be: A. fined. B. removed from the board. C. liquidated. D. delisted and deregistered. 58.A general purpose financial statements means:  A. a financial report intended to meet the information needs of users who are unable.
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True/False 14-T/F #1.              The premise of the economic entity assumption is that the activity of a business enterprise should be kept separate and distinct from its owners and other business entities 14-T/F #2.              In valuing a firm’s assets for financial statement purposes, it is assumed that the business is not one that.
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21. A central goal in establishing a conceptual framework of accounting will be to obtain general consensus on: A. the scope and objectives of financial reporting. B. the qualitative characteristics that financial information should possess. C. what the elements of financial reporting are, including agreement on the characteristics and recognition criteria for.
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27.Section 296 of the Corporations Act requires (all or in part): A. the AASB to follow the broad strategic direction determined by the FRC. B. the directors to make a declaration stating whether, in their opinion, the financial statements comply with accounting standards. C. the AASB to develop a conceptual framework, not.
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Short Answer Essay 16-SAE #1.           What steps should the forensic professional take, assuming that legal counsel initiated the fraud investigation? 16-SAE #2.           What three attributes must the plaintiff demonstrate in a civil framework? Critical Thinking Exercise This is an unusual paragraph. I’m curious how quickly you can find out what is so unusual about.
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31. The IASB Conceptual Framework for Financial Reporting (as released in 2010), requires that general purpose financial reports disclose information that is: A. relevant to the assessment of profit, funding and investing, and compliance. B. relevant to the assessment of financial and social performance, financial position and funding and investing, and.
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Long answer questions: Match the following frauds with their appropriate definitiona.check is intercepted and cashed b.blank check is stolen and cashed c.check is stolen and payee added d.fictitious company added to the vendor master file e.goods purchased from a legitimate vendor, then resold to a fictitious company  4 f.terminated employee continues to be paid g.expense amount altered.
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1.Financial accounting can be considered a process involving the collection and processing of financial information to assist the decision-making needs of parties internal to an organisation.  2.The regulation of accounting can be argued to be necessary to protect the information rights of parties not involved in the day-to-day operations of.
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MULTIPLE CHOICE LO#1 & LO#2 A shell company is: A fictitious company Is controlled by a fraudster Is used to conceal fraudulent invoices All of the above A pass through scheme requires: The availability of an accomplice at a legitimate vendor The ability to add vendors to the vendor master file The ability to change purchase order prices after approval All.
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11.The main role of the Financial Reporting Council (FRC) is to develop a new conceptual framework for financial reporting.  12.The main role of the International Financial Reporting Interpretations Committee (IFRIC) is to review accounting issues that are likely to receive divergent or unacceptable treatment in the absence of authoritative guidance..
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Text Review Questions 16-TRQ #1.          What is meant by remediation? 16-TRQ #2.          What two points must an injured party prove to recover money in a civil lawsuit? 16-TRQ #3.          What are the types of losses available for recovery? 16-TRQ #4.          How does the legal system differentiate between “following” versus “tracing’ the money? 16-TRQ #5.          What.
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True/False 16-T/F #1.              Remediation is characterized as the steps necessary to “clean up the mess” after a fraud or financial crime has been discovered and investigated, and the results of the investigation have been reported. 16-T/F #2.              To prove fraud, the investigator needs to provide evidence that the perpetrator was involved in.
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1.The Conceptual Framework can be described as a positive theory of accounting.  2.In the decade leading up to the 1970s the notable theories being developed were predominantly normative in nature. 3.Normative theories are referred to as prescriptive theories. 4.PAT outlines the best (or most positive) way of preparing accounting reports..
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19.Positive Accounting Theory seeks to: A. prescribe which accounting methods should be used in particular circumstances. B. explain and predict which accounting methods management is likely to select from available choices. C. describe how social relationships are implicated in lobbying by interest groups in accounting standard setting. D. formulate an understanding of how.
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17.What are two key ways management accounting is different from financial accounting? A. Management accounting provides special-purpose information to people external to the firm and it is highly regulated. B. Management accounting provides information for the day-to-day running of an organisation and it is governed by the requirements of ASIC. C. Management.
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True/False 15-T/F #1.              The SEC has created the “Forensic and Valuation Services Section” to provide support to forensic accounting professionals. 15-T/F #2.              Risk and return are inversely related. 15-T/F #3.              Fraud examination, forensic accounting, and litigation support activities can expose the traditional accountant to more risk than consulting engagements and, possibly, to more.
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Short Answer Essay 13-SAE #1.           Describe the features of an effective fraud reporting program within a company. Answer:Reporting programs should emphasize at least six points: fraud, waste, and abuse occur at some level in nearly every organization; this conduct costs jobs, raises, and profits; the organization actively encourages employees to come forward with.
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True/False 13-T/F #1.              Illegal gratuities are similar to bribery schemes, except that something of value is given to an employee to reward a decision rather than influence it. 13-T/F #2.              Corruption schemes are broken down into four classifications: bribery, illegal gratuities, economic extortion and larceny. 13-T/F #3.              Most company ethics policies forbid employees.
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1.  The AASB Framework has the force of law.  2.  The Australian Accounting Standards Board (AASB) retained the use of its own conceptual framework even after harmonisation.  3.  The AASB Framework serves as a guide to the Australian Accounting Standards Board (AASB) in developing accounting standards.  4.  The AASB Framework.
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Short Answer Essay 15-SAE #1.           Define four different measures of value used by a forensic accountant. 15-SAE #2.           Compare two methods that can be used to develop estimates of lost sales and incremental expenses. Critical Thinking Exercise How many outs are there in an inning? .
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13-TRQ #1.          What is a kickback scheme, and how is it committed? Answer:Kickbacks are classified as corruption schemes rather than asset misappropriations because they involve collusion between employees and vendors; in an asset misappropriation, no outsiders know the participants. In a common type of kickback scheme, a vendor submits a fraudulent.
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Text Review Questions 14-TRQ #1.          Why might senior management overstate or understate business performance? 14-TRQ #2.          What are some of the ways in which financial statement fraud is committed? 14-TRQ #3.          What is the conceptual framework for financial reporting? 14-TRQ #4.          What are the four classifications of financial statement fraud? 14-TRQ #5.          How are fictitious.
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15-T/F #1.              Physical and video surveillance by the forensic professional is permitted and electronic audio evidence (capturing spoken words) does not require court permission. 15-T/F #2.              Undercover operations are another tool used primarily by forensic accountants and sometimes by private investigators. 15-T/F #3.              Generally, in order to pursue a claim for legal.
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16-TRQ #1.          What is the difference between fact witnesses and expert witnesses? 16-TRQ #2.          In what types of cases may a forensic accountant serve as an expert witness? 16-TRQ #3.          When may an expert’s opinion be subject to challenge? 16-TRQ #4.          What is a deposition and why is it used? 16-TRQ #5.          What is.
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