Most Recent ACFE CFE-Fraud-Schemes-and-Financial-Crimes Exam Dumps

Rationale for Correct Answer:

In the ''playing the accounting system'' approach, fraudsters manipulate legitimate accounting rules and entries to distort reported results. Examples include manipulating estimates, changing depreciation methods, or shifting expenses. They exploit the flexibility of GAAP to present misleading results while still appearing compliant.

Analysis of Incorrect Options:

A . Organized accounting -- Not a recognized fraud approach.

C . Beating accounting -- Refers to bypassing the system entirely, not using it as a tool.

D . All of the above -- Incorrect because only option B is valid.

Key Concept:

Playing the accounting system as a method of financial statement fraud.

ACFE Fraud Examiners Manual (2020 International Edition), Financial Statement Fraud --- Approaches to Falsifying Financial Statements.

Rationale for Correct Answer:

Physical inventory counts involve actually counting items on hand and comparing them to book records. These counts can reveal theft, errors, or shrinkage when discrepancies are identified.

Analysis of Incorrect Options:

A . Perpetual inventory counts -- The system tracks expected balances but cannot independently confirm theft.

C . Concealment inventory counts -- Not a recognized term.

D . None of the above -- Incorrect, since physical counts do aid detection.

Key Concept:

Physical inventory counts as a fraud detection tool.

ACFE Fraud Examiners Manual (2020 International Edition), Inventory and Other Assets --- Inventory Counts and Fraud Detection.

Rationale for Correct Answer:

Common skimming schemes include unrecorded sales, theft of incoming checks, and understating sales/receivables. ''Fraud & Cost'' is not a recognized skimming scheme and appears to be a distractor.

Analysis of Incorrect Options:

A . Unrecorded sales -- A classic skimming method.

C . Theft of checks through the mail -- Another recognized skimming approach (incoming receivables).

D . Understated sales and receivables -- A concealment method within skimming schemes.

B . Fraud & Cost -- Not a scheme classification.

Key Concept:

Skimming schemes vs. unrelated distractors.

ACFE Fraud Examiners Manual (2020 International Edition), Cash Receipts --- Skimming Types.

The correct answer is C. Government and public sector organizations might need to conduct and respond to fraud risk assessments more frequently because their risks can change with political priorities, public programs, emergency funding, legislative mandates, and changing public expectations. Public entities are accountable to citizens, regulators, oversight bodies, and funding authorities. Option A is incorrect because the absence of shareholders does not permit higher fraud tolerance; public stewardship often requires strong accountability. Option B is inaccurate because public sector priorities can shift quickly based on laws, budgets, and government initiatives. Option D is also incorrect because public organizations usually have less autonomy than private entities due to statutory requirements, public scrutiny, procurement rules, and oversight obligations. Fraud risk assessment should therefore be dynamic and responsive.

================

Rationale for Correct Answer:

Cash larceny involves stealing cash after it has been recorded. Mark stole $50 directly from the register after recording sales, which is a cash larceny scheme.

Analysis of Incorrect Options:

A . Paul's scheme -- This is skimming (off-book theft), not larceny.

B . Emily's scheme -- This is a lapping scheme (concealing theft of receivables), not pure larceny.

C . Sarah/Jenna -- This is an overstated refund scheme (fraudulent disbursement), not larceny.

Key Concept: Cash larceny vs. skimming vs. fraudulent disbursements.