Chapter 08
1. ____ are used by attorneys involved in litigation to track all documents.
a.
Link analyses
b.
Bates numbers
c.
Bar codes
d.
RFID tags
b
a.
b.
c.
d.
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2. The risk that an auditor will examine a fraudulent check and not recognize it as being fraudulent is called _________ .
a.
sampling risk
b.
non-sampling risk
c.
systematic risk
d.
systemic risk
b
a.
Incorrect. Sampling risk is the risk that the sample is not representative of the population.
b.
c.
d.
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3. During a concealment investigation, an investigator fails to recognize that an invoice had been forged. This represents
a:
a.
sampling risk.
b.
non-sampling risk.
c.
systematic risk.
d.
systemic risk.
b
a.
b.
c.
d.
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4. Computer searches and physical asset counts usually focus on the ________ element of the fraud triangle.
a.
theft
b.
concealment
c.
conversion
d.
inquiry
b
a.
5. Methods for concealment investigation include all but which of the following?
a.
Document examination
b.
Searching public records
c.
Audits
d.
Computer searches
b
a.
Incorrect. This is a concealment investigation technique.
b.
c.
Incorrect. This is a concealment investigation technique.
d.
Incorrect. This is a concealment investigation technique.
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6. The three most common ways to obtain documentary evidence which are valuable but difficult to obtain are:
a.
subpoena, voluntary consent, and searching public records
b.
subpoena, search warrant, and voluntary consent
c.
search warrant, invigilation, and surveillance
d.
voluntary consent, surveillance, and invigilation
b
a.
Incorrect. Searching public records is a conversion investigative method.
b.
c.
Incorrect. Surveillance is a theft investigation technique.
d.
Incorrect. Surveillance and invigilation are not methods used to gather documentary evidence.
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7. Which of the following statements is true?
a.
Concealment investigation includes document investigation, physical asset counts, and computer searches.
b.
Most concealment investigation techniques focus on obtaining eyewitness accounts as evidence.
c.
Honesty testing is considered as a concealment investigation technique.
d.
Concealment investigation is dependent on employee cooperation to gather evidence
a
a.
b.
c.
d.
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8. Which of the following is the term for keeping a record of when a document is received and what has happened to it
since its receipt.
a.
Organization of custody
b.
Correct. They usually focus on concealment.
c.
d.
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Chapter 08
b.
Evidence chain
c.
Coordination of custody
d.
Chain of custody
d
a.
b.
c.
d.
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9. Which of the following does NOT appear on a check that has been cashed?
a.
Teller number
b.
Date of the transaction
c.
Transaction number
d.
Time of the transaction
d
a.
b.
c.
d.
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10. What is the term for the risk that the sample was not representative of the population.
a.
Systematic risk
b.
Non-sampling risk
c.
Sampling risk
d.
Compliance risk
a.
b.
c.
d.
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11. Which of the following is generally considered a best practice while handling documentary evidence?
a.
Copies of the document should be used during the investigation and trial and should be kept in the same file
where the original is kept.
b.
Photocopies are always preferable to original documents as evidence, as the original could be tampered with.
c.
Copies of the document should not be made and only the original document should be used during
investigation and trial.
d.
Generally, a summary of the original document should be made for investigation and trial.
a.
b.
12. An audit is part of which type of investigative method?
a.
theft
b.
conversion
c.
concealment
d.
inquiry
c
c.
d.
Incorrect. Inquiry investigations involve interviews and interrogations and honesty testing.
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13. _______ are executed only by law enforcement officials and are generally used only in criminal cases.
a.
Subpoenas
b.
Voluntary consents
c.
Search warrants
d.
Interviews
c
a.
b.
c.
d.
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14. When the document is in the custody of a public office:
a.
it is permissible to obtain photocopies, which are considered secondary evidence, in a court of law.
b.
copies of the document should be made but kept separate from the original document.
c.
the document (or a copy) cannot be used as evidence, in a court of law.
d.
a summary of the document will suffice.
a
a.
b.
c.
d.
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15. Mark owns a 24-hour convenience store. Lately he has noticed that the liquor inventory purchases have gone up by
huge amounts, although sales proceeds from this category haven’t increased. He suspects his two night-shift employees.
Which is the best investigative method to uncover such a fraud?
c.
d.
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Chapter 08
a.
Electronic investigation
b.
Conversion investigation
c.
Inquiry investigation
d.
Concealment investigation
d
a.
b.
c.
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16. Which statistical sampling allows an auditor to generalize and make inferences from the sample to the population?
a.
Probability sampling
b.
Random sampling
c.
Discovery sampling
d.
Quota sampling
c
a.
b.
c.
d.
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17. What is the most common way to obtain private documents (either oral or written)?
a.
subpoena
b.
search warrant
c.
voluntary consent
d.
audit
c
a.
b.
c.
d.
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18. Which aspect of documentary evidence should be kept in mind to ensure that the documents can be identified later and
accessible for trial?
a.
Organization of evidence
b.
Coordination of evidence
c.
Marking of evidence
d.
Chain of custody of documents
c
a.
19. Which of the following is a popular program used to index and store evidence?
a.
CaseCentral
b.
IDEA
c.
TANZAN
d.
SQL
20. ________ is a simple, statistically based method of analyzing a subset of transactions from a larger pool.
a.
Structured sampling
b.
Probability sampling
c.
Cluster sampling
d.
Discovery sampling
21. Which of the following products can be useful to coordinate the evidence in large cases that involve investigators,
legal counsel, accountants, expert witnesses, and management representatives?
a.
DatiCon
b.
Analyst’s Notebook
c.
CaseMap
d.
Ringtail
b.
c.
Correct. Evidence should be uniquely marked so that it can be identified later.
d.
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22. The least reliable method of obtaining documentary evidence is:
a.
through traditional audits.
b.
through computer-based queries
c.
by using statistical techniques.
d.
by accident.
23. Which of the following statements regarding sampling risk is FALSE?
a.
To reduce sampling risk, the investigator can increase the sample size.
b.
Sampling risk can only be slightly reduced by careful planning of the sampling procedure.
c.
To reduce sampling risk, the investigator can use a random number table.
d.
In fraud examination, sampling risk can be significant.
24. The four most common examples of documentary evidence which are valuable but difficult to obtain are:
a.
Web-based e-mail accounts, private bank records, tax returns, and brokerage records.
b.
Sample analytical reports, photographs and videos, tax returns, and SEC filings.
c.
Office e-mail accounts, private bank records, maps and diagrams, and sample analytical reports.
d.
Photographs and videos, private bank records, tax returns, and brokerage records.
25. Orders issued by a court or a grand jury to produce documents are called:
a.
writs of certiorari.
b.
search warrants.
c.
voluntary consent.
d.
subpoenas.
Chapter 08
26. Which of the following observations about discovery sampling is TRUE?
a.
It is one of the more difficult statistical sampling variations to understand.
b.
Auditors using this method can always be certain that fraud does not exist in a population of checks.
c.
It allows an auditor to generalize and make inferences from the population to the sample.
d.
Auditors can quantify both the risk and samples until they have sufficient evidence that fraud does not likely
exist.
27. The best way to obtain documentary evidence is:
a.
by chance, accident or tip discovery.
b.
through computer-based queries of full-population accounting and other databases.
c.
through interviews and interrogations.
d.
through traditional audits like discovery sampling.
28. Once investigators enter their indicators into the centralized database, the software performs _______ to find
connections between people, places, and events.
a.
regression analysis
b.
search analysis
c.
link analysis
d.
correlation analysis
29. Which of the following observations is true about subpoenas?
a.
Subpoenas are generally used only in criminal cases.
b.
Subpoenas are orders issued by the Company Law Board to produce documents.
c.
Failure to honor a subpoena is punishable by law.
d.
Every subpoena must be signed by the plaintiff and the accused.
30. Which of the following is an alternative when original documents are too voluminous to permit careful examination?
a.
A photocopy of the original document will suffice.
b.
It will have to be excluded from usage as evidence.
c.
A summary of its contents is acceptable.
d.
There are no alternatives. The original has to be produced.
31. What is another term used for discovery sampling?
a.
investigative sampling
b.
probability sampling
c.
statistical random sampling
d.
stop-and-go
32. Which of the following statements about subpoenas is correct?
Chapter 08
a.
A subpoena can only be issued by agents of a grand jury or of the court.
b.
A subpoena is one of the two ways to gain access to difficult to obtain information.
c.
A subpoena must be signed by the chair of the grand jury.
d.
A subpoena’s only purpose is to access difficult to obtain documents.
a
a.
b.
Incorrect; there are three ways to access difficult to obtain documents.
c.
Incorrect; a judge or a court commissioner must sign a subpoena.
d.
Incorrect; a witness may also be served a subpoena to appear in court to testify.
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33. Which of the following statements is FALSE regarding a search warrant?
a.
A ‘possible cause’ condition must be met before a search warrant is issued.
b.
There is a belief that the documents have been used in committing a crime.
c.
Only law enforcement officials can execute a search warrant.
d.
Search warrants are generally used only in criminal cases.
a
a.
b.
c.
d.
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34. Which of the following is NOT utilized to make determinations about the document being examined?
a.
forensic chemistry
b.
microscopy
c.
photography
d.
radiology
d
a.
b.
c.
d.
Correct; radiology is not utilized.
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35. Which of the following is NOT a warning sign indicating a possible problem with a document?
a.
disguised or unnatural handwriting
b.
authorized initialed changes
c.
inconsistency or disruption in the continuity of the content
d.
use of two or more different colors of ink
b
a.
Incorrect; this is a warning sign.
b.
Correct, if authorized, changes are not a problem.
36. Computer-based queries of accounting and other data bases are utilized in which of the following investigation
methods?
a.
theft
b.
conversion
c.
concealment
d.
inquiry
c
a.
b.
c.
d.
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37. Which of the following is an example of secondary evidence?
a.
testimony of recipient of stolen assets
b.
confession outside vendors who paid bribes
c.
testimony of witnesses of the fraud act
d.
photocopies of improper documents
d
a.
b.
c.
d.
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38. Which of the following is NOT an action by the fraud perpetrators to hide/conceal their illegal act(s)?
a.
manipulating documentary evidence
b.
modifying records in computer databases
c.
photocopying fraud-related documents
d.
deleting records in computer databases
c
a.
Incorrect, this is an act of concealment.
b.
Incorrect, this is an act of concealment.
c.
Correct, this is not an act of concealment.
d.
Incorrect, this is an act of concealment.
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39. Which of the following is a FALSE statement regarding how the testimony of witnesses can be problematic?
a.
Witnesses can forget important facts.
b.
Witnesses can be confused by opposing attorneys.
c.
Incorrect; this is a warning sign.
d.
Incorrect; this is a warning sign.
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Chapter 08
c.
Witnesses can commit perjury.
d.
Witnesses may depend on their written summary of the facts.
d
a.
Incorrect, this is a true statement.
b.
Incorrect, this is a true statement.
c.
Incorrect, this is a true statement.
d.
Correct, this is a false statement.
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40. The FBI’s Document Conversion Lab does NOT do which of the following?
a.
It saves an incredible amount of time searching documents.
b.
It increases search capabilities regarding relevant documents.
c.
It increases the amount of documentation evidence available.
d.
It enables the sharing of document information.
c
a.
Incorrect, this is a function of DocLab.
b.
Incorrect, this is a function of DocLab.
c.
Correct, this is NOT true regarding DocLab.
d.
Incorrect, this is a function of DocLab.
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41. Which of the following statements is NOT included in a subpoena?
a.
the location of the documents being requested
b.
the identity of who is making the request for the documents
c.
the exact information being requested
d.
the signature of a judge or court commissioner
a
a.
b.
c.
d.
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42. Which amendment provides the right of the people against unreasonable searches and seizures?
a.
First
b.
Second
c.
Third
d.
Fourth
d
a.
b.
c.
d.
