Free ACFE CFE-Fraud-Prevention Practice Test & Real Exam Questions

Exam Code/Number: CFE-Fraud-Prevention
Exam Name/Title: Certified Fraud Examiner - Fraud Prevention and Deterrence Exam
Certification Provider: ACFE
Corresponding Certification: Certified Fraud Examiner

Exam Questions: 286
Updated On: Jul 07, 2026

Question #73

The Committee of Sponsoring Organizations of the Treadway Commission (COSO) defines____________ as "a process, effected by an entity's board of directors, management, andother personnel, designed to provide reasonable assurance regarding the achievement of objectives relating to operations, reporting, and compliance."

A. Risk assessment

B. Fraud risk management

C. Internal control

D. Corporate compliance

Discussion 0

Correct Answer: C Vote an answer

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Question #74

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

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

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

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

Discussion 0

Correct Answer: D Vote an answer

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Question #75

Which of the following is among the board of directors' primary responsibilities related to fraud risk management?

A. Implementing the fraud risk management program

B. Overseeing the organization's fraud risk management activities

C. Punishing fraud perpetrators discovered through fraud risk management activities

D. Designing the fraud risk management program

Discussion 0

Correct Answer: B Vote an answer

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Question #76

During an external audit, the audit team identifies evidence that management has Intentionally manipulated the organization's reported revenue amount 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 reconsider the reliability of the audit evidence they have previously obtained.

C. The auditors should regard the misstatement as immatenal to the audit because the omitted amount is less than the quantitative materiality threshold

D. The auditors should only consider the evidence if they can determine that the actions meet the legal definition of fraud.

Discussion 0

Correct Answer: B Vote an answer

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Question #77

Which organizational factor is MOST likely to undermine an anti-fraud culture?

A. Ethical leadership behavior

B. Consistent enforcement of policies

C. Anonymous reporting mechanisms

D. Tolerance of policy violations by high-performing employees

Discussion 0

Correct Answer: D Vote an answer

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Question #78

Which of the following scenarios would MOST LIKELY be considered a violation of the ACFE Code of Professional Ethics?

A. Riva, a CFE, uncovered material internal control deficiencies that were material but unrelated to the kickback scheme she was investigating. In her final report to management, Riva included information about the deficiencies despite their being unrelated to the situation she was hired to investigate.

B. All of the above are violations.

C. Dee, a CFE, accepted an assignment to conduct a fraud examination within a manufacturing company. Because she rushed to complete the investigation, she overlooked key items of evidence and failed to uncover a fraud scheme.

D. Derrick, a CFE, was hired by a client to conduct a fraud examination but found nothing abnormal.
A year later, he received a court order to provide the client's file to the court. Derrick complied with the court order despite not having the client's authorization to provide the file.

Discussion 0

Correct Answer: C Vote an answer

Question #79

Which of the following statements Is TRUE regarding how fraud examiners should exercise professional skepticism during a fraud examination engagement?

A. Professional skepticism involves maintaining a mindset that no fraud has occurred

B. Fraud examiners should not relax their skeptical attitudes under any circumstances.

C. Fraud examiners should form the engagement hypothesis without regard to the nature of the assignment

D. Professional skepticism can be dispelled only by evidence

Discussion 0

Correct Answer: D Vote an answer

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Question #80

Which of the following is FALSE regarding a background check policy for employees?

A. As part of the screening process, management should contact the references provided by the job candidate.

B. Where permitted by law, management should run a background check on any existing employee who is being promoted to a position that includes access to sensitive or valuable company resources, even if a background check was run on the individual at the time of hire

C. When verifying past employment, management should only ask previous employers to verify the dates the candidate was employed.

D. At a minimum, management should conduct a background check on any candidate who will have constant access to cash, checks, and credit card numbers, or other easily stolen items.

Discussion 0

Correct Answer: C Vote an answer

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Question #81

Which of the following statements is FALSE regarding an organization's fraud risk management program?

A. A specific individual or team should be designated as responsible for monitoring compliance with the program

B. Formal sanctions for intentional noncompliance should be determined and enacted privately

C. The program must include mechanisms to address breaches in compliance.

D. The punishment for intentional noncompliance should be carried out in a consistent and firm manner.

Discussion 0

Correct Answer: B Vote an answer

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