Free ACFE CFE-Fraud-Prevention-and-Deterrence Exam Questions

Become ACFE Certified with updated CFE-Fraud-Prevention-and-Deterrence exam questions and correct answers

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Total 360 Questions | Updated On: Mar 08, 2026

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Question 1

Which of the following is TRUE regarding the internal audit function's reporting responsibilities pertaining to fraud?

A : The internal audit function should discuss how and when to report fraud-related issues with senior management and the board of directors before such issues arise.

B : The internal audit function is permitted, but not required, to periodically report about the organization's fraud risks to senior management and the board of directors.

C : The internal audit function should not disclose the results of its fraud audits to senior management or the board of directors in order to maintain independence

D : The internal audit function is not permitted to communicate with the board of directors about fraud, as that is the responsibility of external auditors.

Answer: A

Question 2

According to Steve Albrecht's research,______is the most common personal characteristic motivating fraudsters, and ________ is the most common organization-environment factor motivating fraudsters.

A : High personal debt; lack of separation of duties

B : Revenge: too much trust in key employees

C : Living beyond their means, too much trust in key employees

D : Desire for recognition, lack of separation of duties

Answer: C

Question 3

Which of the following would speed up the pick-up process at a warehouse?

A : Use an unified barcode system for every item within the warehouse

B : Categorize the items based on their pick-up frequency

C : Narrow down the aisles to enlarge total storage area

D : Combine goods-in and goods-out areas into one place

Answer: B

Question 4

To reinforce an anti-fraud culture, it is BEST for an organization's management to:

A : Use a checklist of initiatives to ensure that all the elements of a strong corporate culture are in place.

B : Require senior leaders to follow the same ethics policies that are in place for all staff-level employees.

C : Discourage employees from questioning their immediate supervisor's actions or decisions if they have concerns.

D : Discipline any employees who publicly express their frustration regarding organizational policies.

Answer: B

Question 5

During an external audit, the audit team identifies evidence that management has intentionally omitted some expenses from the company's financial statements in order to conceal an asset misappropriation scheme. However, the amount of the resulting misstatement does not meet the quantitative materiality threshold for the audit. Which of the following is TRUE regarding this situation?

A : The auditors should assume that all audit evidence collected previously is unreliable and withdraw from the audit engagement

B : The auditors should assess the need to adjust the nature, timing, and extent of remaining audit procedures based on this evidence.

C : The auditors can ignore the misstatement because the omitted amount is less than the quantitative materiality threshold and therefore immaterial to the audit.

D : The auditors do not need to be concerned with this evidence, as asset misappropriation schemes are not considered relevant or material for external audit purposes.

Answer: B

Page: 1 / 72

Total 360 Questions | Updated On: Mar 08, 2026

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