Free ACFE CFE-Investigation Practice Exam with Questions & Answers | Set: 2

The Fraud Examiners Manual states:

“Duplicate testing is used to identify transactions with duplicate values in specified fields … fields such as cheque numbers, invoice numbers, and government identification numbers … searching for duplicates within these fields can help the fraud examiner find anomalies that merit further examination”.

This directly addresses Tony’s need to ensure no two invoices have the same number.

Best practice is to conduct interviewsindividually. The Manual states:

“When conducting interviews, witnesses should beinterviewed separately. Interviewing multiple witnesses together risks contamination of testimony and reduced reliability of responses”.

Signs of stress (e.g., shallow breathing, stuttering, shifting posture) do not automatically equal deception. TheFraud Examiners Manualstates:

“Signs of stress do not always mean a subject is lying. An honest subject might feel stress simply by being questioned. Conclusions must be based on clusters of behavior and corroborating evidence, not a single indicator”.

The2014 Fraud Examiners ManualandCFE Preplist common concealment methods:

“Some common techniques for hiding assets include transferring assets into foreign trusts, overpaying taxes, prepaying on a home mortgage, obtaining a life insurance policy, and transferring assets into someone else’s name.”

Thus, the correct answer isD.

TheCFE Prep – Investigationsexplains:

“Metadata is a type of computer-generated data that can be helpful in a fraud investigation. Metadata information can help determine who wrote a document; who received, opened, copied, edited, moved, or printed the document; and when these events occurred” .

Thus, metadata is the most useful for identifying who created a document.

“Before commencing a formal investigation (and especially before starting the evidence collection process), it might be necessary to prepare the subject organisation… such as preparing the managers of the employees who will be involved in the investigation, notifying key decision makers, and notifying the organisation’s legal counsel”.

It is not good practice to notify the entire workforce or inform the suspect.

TheFraud Examiners Manuallistsspecific queries for accounts payable analysis, including:

“Review recurring monthly expenses and compare to posted/paid invoices.”.

While comparing book vs. tax depreciation applies toasset management(not A/P), and identifying paycheck anomalies applies topayroll(not A/P), the most effective A/P-specific test is the recurring expense comparison. Hence,Cis correct.

Fraud examination reports are not written only for internal use. The2014 International Fraud Examiners Manualclearly emphasizes:

“When drafting a report, fraud examiners must consider who might end up reading it. Fraud examiners should keep in mind that the fraud examination report will be read by the general public and adverse parties. Under no circumstances should the fraud examiner prepare a communication with the idea that the information will not be disclosed to adverse third parties. Fraud examiners should draft their reports with this caveat in mind.”

The manual further specifies the wide range of potential readers:

*“There are many individuals and groups that might end up reading a fraud examination report, including the following parties:

Company insiders (managers, board of directors, owners, investors, etc.)

Attorneys (legal counsel, prosecutors, regulators, and defense counsel)

Defendants and witnesses

Press and media outlets

Judges or juries”*

This aligns with theCFE Prep - Investigationsstudy guide, which also confirms:

“There are many parties that might read a fraud examination report, including company insiders, attorneys, defendants and witnesses, press and media outlets, and judges or juries.”

????Interpretation:

The mediamay access the report through litigation disclosures or leaks.

Opposing legal counselwill review the report during discovery or trial.

Investors and owners(company insiders) are primary stakeholders.

Thus, the only correct choice isD. All of the above, because fraud examination reports must be written withall possible audiences in mind, ensuring accuracy, clarity, impartiality, and professionalism to withstand scrutiny from multiple directions.

“Once a suspect utters a denial, it becomes extremely difficult… therefore, the interviewer mustprevent an outright denial. Fraud examiners can use several techniques to stop or interrupt denials, includingdelays, repeated interruptions, and reasoning”.

Thus, the correct answer isD.

TheFraud Examiners Manualstates:

“The primary concern when analysing digital evidence is to maintain the integrity of the data at all times. Fraud examiners must be careful with computer equipment because a careless investigator might inadvertently alter important evidence”.

Examiners must look for both inculpatory and exculpatory evidence.