Unformatted text preview: a. Lapping. b. Ghost employee. c. Missing employee. d. Kiting. e. None of the above. 80. A person finds land, buys it, increases the price, and sells it to his company. What is this scheme? a. A ghost scheme. b. Land flip. c. Ponzi scheme. d. Bid rigging. e. All of the above. 82. Select the true answer. To prevent fraud, the entity may choose to: a. Develop a written code of ethics. b. Use background checks when hiring employees. c. Require an annual interview by internal auditors, security, or others of suspicious employees. d. Prosecute discovered fraud, as an example to other employees. e. All of the above are true. 84. Which factor would not indicate a fraud warning sign for not‐for‐profit organizations? a. Increase in amount owed to creditors. b. Deterioration of key ratio. c. Expense accounts are decreasing. d. Non‐payment of insurance premiums. e. Regular deferral of capital expenditures. General Feedback: The reverse of c would be a warning sign. 85. Which factor would not indicate a fraud warning sign for not‐for‐profit organizations? a. No separation of check writing and check signing. b. Qualification in the auditor's report. c. Resignation of key staff member. d. Significant decline in turnover. e. Employee morale is high. 87. Which would be considered a negative trend for a municipality? a. Fixed Costs less Personal Services and Debt Services is decreasing over time. b. Operating Surplus is increasing over time. c. Unreserved Fund Balance divided by Gross Expenditures ratio is decreasing over time. d. The ratio of Cash and Investments divided by Current Liabilities is increasing over time. Page 34 of 44 ...
View Full Document
- Summer '10
- fraud warning sign, a. Lapping. b., c. Ponzi scheme., employees. d. Prosecute, time. c. Unreserved, ghost scheme. b.