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Unformatted text preview: 21. The control environment is one of the five interrelated components of internal controls. a. True b. False 22. In an Ernst & Young study, 50% of the most serious fraud was committed by the organization's own management. a. True b. False 23. An exact profile has been developed of a potential fraudster by several large CPA firms. a. True b. False 24. Senior‐level management fraudsters often surround themselves with "yes people." a. True b. False 26. An ethical "tone at the top" helps deter white‐collar crime. a. True b. False 29. Forensic investigators uncover financial statement fraud by looking for unusual red flags or patterns. a. True b. False 30. Wildcatting is an investigative technique adopted by the SEC to investigate a specific company for check forgery. a. True b. False 31. Large companies tend to more frequently manage earnings to avoid losses than small companies. a. True b. False 32. Financial fraud is more likely to occur if a company has a poor management control philosophy. a. True b. False 33. Check forgery can be both an internal and external fraud. a. True b. False 34. Credit card fraud is generally an internal fraud. Page 6 of 44 ...
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This note was uploaded on 07/16/2010 for the course ACCOUNTING 2301 taught by Professor Norton during the Summer '10 term at Academy of Design Tampa.
- Summer '10