1. To prevent fraudulent shipments of merchandise, organizations s.docxjackiewalcutt
1. To prevent fraudulent shipments of merchandise, organizations should:
a. Match every receiving slip to an approved purchase order.
b. Match every outgoing shipment to a sales order.
c. Make sure that all increases to perpetual inventory records are supported by proper source documents.
d. All of the above
2. Of the following, which is the best method for detecting the theft of inventory?
a. Have the warehouse manager personally oversee bi-monthly inventory counts.
b. Have someone from purchasing conduct inventory counts every quarter.
c. Have a designated person in customer service follow-up with customers who have complained about short shipments.
d. Match vendor addresses against employee addresses.
3. Which of the following procedures would be least helpful in preventing larceny of non-cash assets?
a. Segregating the duties of sales and accounts payable
b. Installing surveillance cameras in the warehouse and on sales floors
c. Creating access logs to track employees that enter restricted areas
d. Employing security guards at the entrance of the warehouse
4. Unexplained increases in inventory shrinkage can be a red flag that signals which type of fraud scheme?
a. Fictitious refunds
b. Inventory larceny
c. Sales skimming
d. All of the above
5. Which of the following computer audit tests can be used to detect purchasing and receiving schemes?
a. Identifying dormant customer accounts for the past six months that show a sale in the last two months of the year
b. Calculating the ratio of the largest sale to the next largest sale by customer
c. Extracting all inventory coded as obsolete and possessing reorder points within the inventory system
d. All of the above
6. Andy Kaplan is a foreman for JCP Enterprises, a regional construction company. He recently ordered some plumbing supplies from the company warehouse for an office building project he is overseeing. When the supplies arrived at the job site, however, he loaded them in his truck and took them home to use in remodeling his master bathroom. What kind of inventory theft scheme did Andy commit?
a. False shipments
b. Unconcealed larceny
c. Asset requisition
d. Misappropriation of intangible assets
B
1. ___________________ is the offering, giving, receiving, or soliciting of something of value as a reward for a favorable decision.
a. Business diversion
b. Economic extortion
c. Illegal gratuity
d. Commercial bribery
2. The offering, giving, receiving, or soliciting of something of value for the purpose of influencing a business decision without the knowledge or consent of the principal is known as:
a. Official bribery
b. Commercial bribery
c. Conflict of interest
d. Illegal gratuity
3. To facilitate a bribery scheme, a fraudster might divert company funds to a non-company account from which the illegal payments can be made. This account is called a:
a. Slush fund
b. Petty cash fund
c. Bid pool
d. None of the above
4. Identifying trends in over-purchased and/or obsol ...
1 ACCT 422 – Auditing Theory and Practice Final.docxjoyjonna282
1
ACCT 422 – Auditing Theory and Practice
Final Exam
Due: 4 hours after Private Message containing exam is opened and no
later than Sunday, March 9, 2014 at 11:00 p.m. EST
Instructions: You have four (4) hours to complete and submit this final exam in your
assignment folder. This is an open book, open notes exam. This final exam consists of 3
parts. Your answers to the exam should be submitted on a separate answer sheet. Your
answer sheet should be submitted as an attachment in your assignment folder under the
“Final” folder in Microsoft Word, WordPerfect or PDF format. Please write your name
on your answer sheet. Please do not write your answers directly in the narrative portion
of your assignment folder.
Part 1: Multiple Choice questions – (worth total of 75 points)
For Part 1, please number your answer sheet from 1 to 40 and provide the letter corresponding to
the best answer (eg, 1. A, 2. B, etc.).
1.
Insurance expense for the period is a function of which of the following?
A. The beginning prepaid balance, current premium payments and the ending prepaid
balance.
B. The beginning prepaid balance and the current period premium payments.
C. The current period premium payments.
D. The current period premium payments and the ending prepaid balance.
2.
A significant customer of the firm suffers a large economic loss after year end, but
prior to completion of field work. The audit client believes this event will have material
effect on the financial statements. The auditor should:
A. adjust the financial statements for the year under audit.
B. add a paragraph to the audit report.
C. advise the client to disclose the event in the notes to the financial statements.
D. advise the client to delay issuing the financial statements until the economic loss
can be determined.
3.
Which of the following statements is true?
A. There is an inverse relationship between the interest and dividends accounts and
debt and equity.
B. There is no relationship between the interest and dividends accounts and debt and
equity.
C. There is a direct relationship between the interest and dividends accounts and debt
and equity.
D. None of the above is true.
2
4.
The process of transferring money from one bank account to another and improperly
recording the transaction is referred to as:
A. kiting.
B. lapping.
C. scamming.
D. embezzling.
5.
Which of the following is least likely to uncover fraud?
A. External auditors
B. Internal auditors
C. Internal controls
D. Management
6.
Which of the following is not correct regarding an auditor's decision that a lower
acceptable audit risk is appropriate?
A. More evidence is accumulated.
B. Less evidence is accumulated.
C. Special care is required in assigning experienced staff.
D. Review of audi ...
With the help of our P3 Exam Questions Braindumps, you can pass your CIMA P3 exam very easily. We offer here only important and up-to-date CIMA P3 dumps question and answers and we make sure, it will be beneficial and handy for you. P3 CIMA Exam require lot of efforts to pass. First have to prepare all P3 course syllabus online study and then need to prepare CIMA P3 past papers. You can prepare from P3 courses notes online in UK and sample questions and answers practice exams paper. We have CIMA P3 practice exam available with real exam questions answers. Just Prepare and pass exam.
http://www.certs4you.com/cima/p3-dumps.html
TEST BANK For Auditing & Assurance Services A Systematic Approach, 11th Editi...robinsonayot
TEST BANK For Auditing & Assurance Services A Systematic Approach, 11th Edition By William Messier Jr, Steven Glover, Verified Chapters 1 - 21, Complete Newest Version.pdf
TEST BANK For Auditing & Assurance Services A Systematic Approach, 11th Edition By William Messier Jr, Steven Glover, Verified Chapters 1 - 21, Complete Newest Version.pdf
Financial Institution Management 3rd Edition Lange Test BankCharlesLsm
Full download : http://alibabadownload.com/product/financial-institution-management-3rd-edition-lange-test-bank/ Financial Institution Management 3rd Edition Lange Test Bank
1. To prevent fraudulent shipments of merchandise, organizations s.docxjackiewalcutt
1. To prevent fraudulent shipments of merchandise, organizations should:
a. Match every receiving slip to an approved purchase order.
b. Match every outgoing shipment to a sales order.
c. Make sure that all increases to perpetual inventory records are supported by proper source documents.
d. All of the above
2. Of the following, which is the best method for detecting the theft of inventory?
a. Have the warehouse manager personally oversee bi-monthly inventory counts.
b. Have someone from purchasing conduct inventory counts every quarter.
c. Have a designated person in customer service follow-up with customers who have complained about short shipments.
d. Match vendor addresses against employee addresses.
3. Which of the following procedures would be least helpful in preventing larceny of non-cash assets?
a. Segregating the duties of sales and accounts payable
b. Installing surveillance cameras in the warehouse and on sales floors
c. Creating access logs to track employees that enter restricted areas
d. Employing security guards at the entrance of the warehouse
4. Unexplained increases in inventory shrinkage can be a red flag that signals which type of fraud scheme?
a. Fictitious refunds
b. Inventory larceny
c. Sales skimming
d. All of the above
5. Which of the following computer audit tests can be used to detect purchasing and receiving schemes?
a. Identifying dormant customer accounts for the past six months that show a sale in the last two months of the year
b. Calculating the ratio of the largest sale to the next largest sale by customer
c. Extracting all inventory coded as obsolete and possessing reorder points within the inventory system
d. All of the above
6. Andy Kaplan is a foreman for JCP Enterprises, a regional construction company. He recently ordered some plumbing supplies from the company warehouse for an office building project he is overseeing. When the supplies arrived at the job site, however, he loaded them in his truck and took them home to use in remodeling his master bathroom. What kind of inventory theft scheme did Andy commit?
a. False shipments
b. Unconcealed larceny
c. Asset requisition
d. Misappropriation of intangible assets
B
1. ___________________ is the offering, giving, receiving, or soliciting of something of value as a reward for a favorable decision.
a. Business diversion
b. Economic extortion
c. Illegal gratuity
d. Commercial bribery
2. The offering, giving, receiving, or soliciting of something of value for the purpose of influencing a business decision without the knowledge or consent of the principal is known as:
a. Official bribery
b. Commercial bribery
c. Conflict of interest
d. Illegal gratuity
3. To facilitate a bribery scheme, a fraudster might divert company funds to a non-company account from which the illegal payments can be made. This account is called a:
a. Slush fund
b. Petty cash fund
c. Bid pool
d. None of the above
4. Identifying trends in over-purchased and/or obsol ...
1 ACCT 422 – Auditing Theory and Practice Final.docxjoyjonna282
1
ACCT 422 – Auditing Theory and Practice
Final Exam
Due: 4 hours after Private Message containing exam is opened and no
later than Sunday, March 9, 2014 at 11:00 p.m. EST
Instructions: You have four (4) hours to complete and submit this final exam in your
assignment folder. This is an open book, open notes exam. This final exam consists of 3
parts. Your answers to the exam should be submitted on a separate answer sheet. Your
answer sheet should be submitted as an attachment in your assignment folder under the
“Final” folder in Microsoft Word, WordPerfect or PDF format. Please write your name
on your answer sheet. Please do not write your answers directly in the narrative portion
of your assignment folder.
Part 1: Multiple Choice questions – (worth total of 75 points)
For Part 1, please number your answer sheet from 1 to 40 and provide the letter corresponding to
the best answer (eg, 1. A, 2. B, etc.).
1.
Insurance expense for the period is a function of which of the following?
A. The beginning prepaid balance, current premium payments and the ending prepaid
balance.
B. The beginning prepaid balance and the current period premium payments.
C. The current period premium payments.
D. The current period premium payments and the ending prepaid balance.
2.
A significant customer of the firm suffers a large economic loss after year end, but
prior to completion of field work. The audit client believes this event will have material
effect on the financial statements. The auditor should:
A. adjust the financial statements for the year under audit.
B. add a paragraph to the audit report.
C. advise the client to disclose the event in the notes to the financial statements.
D. advise the client to delay issuing the financial statements until the economic loss
can be determined.
3.
Which of the following statements is true?
A. There is an inverse relationship between the interest and dividends accounts and
debt and equity.
B. There is no relationship between the interest and dividends accounts and debt and
equity.
C. There is a direct relationship between the interest and dividends accounts and debt
and equity.
D. None of the above is true.
2
4.
The process of transferring money from one bank account to another and improperly
recording the transaction is referred to as:
A. kiting.
B. lapping.
C. scamming.
D. embezzling.
5.
Which of the following is least likely to uncover fraud?
A. External auditors
B. Internal auditors
C. Internal controls
D. Management
6.
Which of the following is not correct regarding an auditor's decision that a lower
acceptable audit risk is appropriate?
A. More evidence is accumulated.
B. Less evidence is accumulated.
C. Special care is required in assigning experienced staff.
D. Review of audi ...
With the help of our P3 Exam Questions Braindumps, you can pass your CIMA P3 exam very easily. We offer here only important and up-to-date CIMA P3 dumps question and answers and we make sure, it will be beneficial and handy for you. P3 CIMA Exam require lot of efforts to pass. First have to prepare all P3 course syllabus online study and then need to prepare CIMA P3 past papers. You can prepare from P3 courses notes online in UK and sample questions and answers practice exams paper. We have CIMA P3 practice exam available with real exam questions answers. Just Prepare and pass exam.
http://www.certs4you.com/cima/p3-dumps.html
TEST BANK For Auditing & Assurance Services A Systematic Approach, 11th Editi...robinsonayot
TEST BANK For Auditing & Assurance Services A Systematic Approach, 11th Edition By William Messier Jr, Steven Glover, Verified Chapters 1 - 21, Complete Newest Version.pdf
TEST BANK For Auditing & Assurance Services A Systematic Approach, 11th Edition By William Messier Jr, Steven Glover, Verified Chapters 1 - 21, Complete Newest Version.pdf
Financial Institution Management 3rd Edition Lange Test BankCharlesLsm
Full download : http://alibabadownload.com/product/financial-institution-management-3rd-edition-lange-test-bank/ Financial Institution Management 3rd Edition Lange Test Bank
1
WEEK 2 TEAM ASSIGNMENT
Week 2 Team Assignment
Learning Team B
ACC/492
7/24/16
Introduction
AUDIT PROGRAM FOR CASH
Risks
· Cash transactions may not be documented correctly
· Does cash exist
· Fraud
Steps
1. Discuss and document the routine for receiving and disbursing cash.
a) Sources of cash
b) Frequency of bank deposits
c) The person making the deposit
d) The various levels of cash received, is it appropriate
e) Documentation of expenditures (check requests, agreements, invoices…)
f) The approval process
2. Confirm selected bank accounts and special activities
For the petty cash funds (Is the petty cash voucher maintained properly?)
Are physical cash counts:
a) Conducted regularly by a person or people who are not direct guardians of the petty cash funds?
b) Reconciled with the petty cash voucher?
c) Documented the counts and reconciled against the petty cash voucher?
d) Are the petty cash funds restricted to only authorized personnel? Who has contact to funds?
For all checking accounts
a) Identify how many signatures are mandatory on each check.
b) Identify the process by which cash is received and how often.
c) Acquire bank statements for each bank account.
d) Identify the frequency and timing of the bank reconciliations. Who is responsible for the reconciliations?
e) Acquire bank reconciliations and test for accuracy.
f) Affirm if an additional person reviews bank reconciliations on a regular monthly basis. The review document should include the date of examination and a signature of the second person reviewing the bank reconciliation.
3. Test bank reconciliations
Choose bank accounts for confirmation in order to obtain a moderate to low level of assurance that the above mentioned audit purposes are achieved.
a) Test the mathematical accuracy of bank reconciliations
b) Trail-back to the book balances on the client’s bank reconciliation to the summary.
c) Trail-back to the balances on the client’s bank reconciliation to the bank statement.
d) Test reconciling items on the bank reconciliation by performing the following:
i) acquire previous month bank statement and supporting documents
ii) trace outstanding items listed on the bank reconciliation.
iii) trace deposits in transit listed on the bank reconciliation.
iv) get explanation of big, uncommon reconciling items and trace to supporting documents.
v) investigate any other unusual items.
Confirmation requests should be sent under our control and, second requests and, where warranted, third requests should be mailed when responses to confirmation requests have not been received within a reasonable time.
Consider sending a special inquiry letter to ascertain the existence of special arrangements or restrictions, for example, compensating balance arrangements, security arrangements, written guarantees.
4. Review confirmations received
For confirmations received:
a) compare account information and account balance to matching summary.
...
10- which of the following should be the first step in reviewing he fi.docxcwayne3
10. which of the following should be the first step in reviewing he financial statements of a nonissuer?
A. comparing the financial statements with statements for comarable rior periods and wth anticipated rresults.
B. completing a series of inquiries concerning the entity\'s procedures for recording, classifying, and summarizing.
C. obtaining a general understanding of the entity\'s organization, its operating charateristics, and its products or services.
D. applying analytical procedures designed to identify relationships and individual items that appear to be unusual.
12. Which of the following procedures should an accountant perfrm dduring an engagement to review the financial statements of a nonissuer?
A. communicating control deficiencies discovered during the assessment of control risk.
B.. obtaining a client representation letter from members of management
C. sending bank confirmation letters to the entity\'s financial institutions
D. examining cash disbursements in the subsequent period for un recorded liabilities.
Solution
10. The correct answer is:
C. obtaining a general understanding of the entity\'s organization, its operating charateristics, and its products or services
12. The correct answer is:
B.. obtaining a client representation letter from members of management
.
Auditing and Assurance Services In Australia 7th Edition Gay Test BankMageeMagee
Full download : https://alibabadownload.com/product/auditing-and-assurance-services-in-australia-7th-edition-gay-test-bank/ Auditing and Assurance Services In Australia 7th Edition Gay Test Bank
Dear students get fully solved assignments
Send your semester & Specialization name to our mail id :
help.mbaassignments@gmail.com
or
call us at : 08263069601
Question 1 The first general standard of the PCAOB requires th.docxIRESH3
Question 1
The first general standard of the PCAOB requires that an audit be performed by which type of person?
Answer
An auditor with seasoned judgment in varying degrees of supervision and review.
An auditor with appropriate technical training and proficiency.
An auditor with adequate knowledge of the standards of field work and reporting.
An auditor satisfying the independence standards
Question 2
Which assertion addresses whether all transactions and accounts that should be included in the financial statements are included?
Answer
Existence.
Valuation.
Completeness.
Rights and Obligations
Question 3
Which one of the following attributes is not required of an auditor?
Answer
Independence.
Bias.
Integrity.
Technical competence
Question 4
Which one of the following is a reporting standard requirement?
Answer
The auditor will state explicitly whether the financial statements are fairly presented in accordance with the applicable financial reporting framework.
The auditor will identify in the auditor’s report, those circumstances in which auditing principles have not been consistently observed in the current period in comparison to the preceding period.
The auditor will review adjusting journal entries for accuracy, and if the auditor concludes those entries are not reasonable accurate, the auditor must so state in the auditor’s report.
The auditor will express an unqualified opinion on the financial statements, or will conduct additional audit procedures until such an opinion can be expressed
Question 5
When obtaining an understanding of internal controls, what is the independent external auditor primary concerned with?
Answer
Detecting all errors.
Determining the effectiveness of operations.
Determining whether the internal controls can be relied upon.
Determining whether the controls promote efficiency
Question 6
Which of the following is an inherent limitation of internal controls?
Answer
Lack of auditor independence.
Collusion.
Separation of duties.
Employee peer review.
Question 7
Which of the following is clearly a test of controls?
Answer
Walk-through of the expense cycle from performance of the service to the reporting in the balance sheet.
Examination of a sample of purchase order records for electronic, authenticated, authorization.
Observing the controller's use of company owned equipment.
Sending a letter to the client's attorney to determine litigation that is pending between plaintiff and the defendant
Question 8
Which of the following is an example of a detective control in an information system?
Answer
Automated reports to management that specifically identify delinquent receivable.
A requirement that salaried employees submit written requests to work overtime.
Assurance from top management that computer centers are kept locked.
The employment of trustworthy people to enter data into the information system
Question 9
Which of foll ...
This presentation was delivered at the ISO 37001 & Anti-Bribery PECB Insights Conference by Ralph Haddad, Global Compliance Leader at Anti-Corruption at CAE Inc.
1
WEEK 2 TEAM ASSIGNMENT
Week 2 Team Assignment
Learning Team B
ACC/492
7/24/16
Introduction
AUDIT PROGRAM FOR CASH
Risks
· Cash transactions may not be documented correctly
· Does cash exist
· Fraud
Steps
1. Discuss and document the routine for receiving and disbursing cash.
a) Sources of cash
b) Frequency of bank deposits
c) The person making the deposit
d) The various levels of cash received, is it appropriate
e) Documentation of expenditures (check requests, agreements, invoices…)
f) The approval process
2. Confirm selected bank accounts and special activities
For the petty cash funds (Is the petty cash voucher maintained properly?)
Are physical cash counts:
a) Conducted regularly by a person or people who are not direct guardians of the petty cash funds?
b) Reconciled with the petty cash voucher?
c) Documented the counts and reconciled against the petty cash voucher?
d) Are the petty cash funds restricted to only authorized personnel? Who has contact to funds?
For all checking accounts
a) Identify how many signatures are mandatory on each check.
b) Identify the process by which cash is received and how often.
c) Acquire bank statements for each bank account.
d) Identify the frequency and timing of the bank reconciliations. Who is responsible for the reconciliations?
e) Acquire bank reconciliations and test for accuracy.
f) Affirm if an additional person reviews bank reconciliations on a regular monthly basis. The review document should include the date of examination and a signature of the second person reviewing the bank reconciliation.
3. Test bank reconciliations
Choose bank accounts for confirmation in order to obtain a moderate to low level of assurance that the above mentioned audit purposes are achieved.
a) Test the mathematical accuracy of bank reconciliations
b) Trail-back to the book balances on the client’s bank reconciliation to the summary.
c) Trail-back to the balances on the client’s bank reconciliation to the bank statement.
d) Test reconciling items on the bank reconciliation by performing the following:
i) acquire previous month bank statement and supporting documents
ii) trace outstanding items listed on the bank reconciliation.
iii) trace deposits in transit listed on the bank reconciliation.
iv) get explanation of big, uncommon reconciling items and trace to supporting documents.
v) investigate any other unusual items.
Confirmation requests should be sent under our control and, second requests and, where warranted, third requests should be mailed when responses to confirmation requests have not been received within a reasonable time.
Consider sending a special inquiry letter to ascertain the existence of special arrangements or restrictions, for example, compensating balance arrangements, security arrangements, written guarantees.
4. Review confirmations received
For confirmations received:
a) compare account information and account balance to matching summary.
...
10- which of the following should be the first step in reviewing he fi.docxcwayne3
10. which of the following should be the first step in reviewing he financial statements of a nonissuer?
A. comparing the financial statements with statements for comarable rior periods and wth anticipated rresults.
B. completing a series of inquiries concerning the entity\'s procedures for recording, classifying, and summarizing.
C. obtaining a general understanding of the entity\'s organization, its operating charateristics, and its products or services.
D. applying analytical procedures designed to identify relationships and individual items that appear to be unusual.
12. Which of the following procedures should an accountant perfrm dduring an engagement to review the financial statements of a nonissuer?
A. communicating control deficiencies discovered during the assessment of control risk.
B.. obtaining a client representation letter from members of management
C. sending bank confirmation letters to the entity\'s financial institutions
D. examining cash disbursements in the subsequent period for un recorded liabilities.
Solution
10. The correct answer is:
C. obtaining a general understanding of the entity\'s organization, its operating charateristics, and its products or services
12. The correct answer is:
B.. obtaining a client representation letter from members of management
.
Auditing and Assurance Services In Australia 7th Edition Gay Test BankMageeMagee
Full download : https://alibabadownload.com/product/auditing-and-assurance-services-in-australia-7th-edition-gay-test-bank/ Auditing and Assurance Services In Australia 7th Edition Gay Test Bank
Dear students get fully solved assignments
Send your semester & Specialization name to our mail id :
help.mbaassignments@gmail.com
or
call us at : 08263069601
Question 1 The first general standard of the PCAOB requires th.docxIRESH3
Question 1
The first general standard of the PCAOB requires that an audit be performed by which type of person?
Answer
An auditor with seasoned judgment in varying degrees of supervision and review.
An auditor with appropriate technical training and proficiency.
An auditor with adequate knowledge of the standards of field work and reporting.
An auditor satisfying the independence standards
Question 2
Which assertion addresses whether all transactions and accounts that should be included in the financial statements are included?
Answer
Existence.
Valuation.
Completeness.
Rights and Obligations
Question 3
Which one of the following attributes is not required of an auditor?
Answer
Independence.
Bias.
Integrity.
Technical competence
Question 4
Which one of the following is a reporting standard requirement?
Answer
The auditor will state explicitly whether the financial statements are fairly presented in accordance with the applicable financial reporting framework.
The auditor will identify in the auditor’s report, those circumstances in which auditing principles have not been consistently observed in the current period in comparison to the preceding period.
The auditor will review adjusting journal entries for accuracy, and if the auditor concludes those entries are not reasonable accurate, the auditor must so state in the auditor’s report.
The auditor will express an unqualified opinion on the financial statements, or will conduct additional audit procedures until such an opinion can be expressed
Question 5
When obtaining an understanding of internal controls, what is the independent external auditor primary concerned with?
Answer
Detecting all errors.
Determining the effectiveness of operations.
Determining whether the internal controls can be relied upon.
Determining whether the controls promote efficiency
Question 6
Which of the following is an inherent limitation of internal controls?
Answer
Lack of auditor independence.
Collusion.
Separation of duties.
Employee peer review.
Question 7
Which of the following is clearly a test of controls?
Answer
Walk-through of the expense cycle from performance of the service to the reporting in the balance sheet.
Examination of a sample of purchase order records for electronic, authenticated, authorization.
Observing the controller's use of company owned equipment.
Sending a letter to the client's attorney to determine litigation that is pending between plaintiff and the defendant
Question 8
Which of the following is an example of a detective control in an information system?
Answer
Automated reports to management that specifically identify delinquent receivable.
A requirement that salaried employees submit written requests to work overtime.
Assurance from top management that computer centers are kept locked.
The employment of trustworthy people to enter data into the information system
Question 9
Which of foll ...
This presentation was delivered at the ISO 37001 & Anti-Bribery PECB Insights Conference by Ralph Haddad, Global Compliance Leader at Anti-Corruption at CAE Inc.
Similar to CAMS Certified Anti-Money Laundering Specialist Updated Dumps (18)
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1. The safer , easier way to help you pass CAMS exam.
1 / 9
Exam : CAMS
Title :
https://www.passcert.com/CAMS.html
Certified Anti-Money
Laundering Specialist
2. The safer , easier way to help you pass CAMS exam.
2 / 9
1.What does designing a country as being of “prime money laundering concern” allow the U.S.
government to do?
A. Obtain transactional information from U.S.-owned subsidiary banks located outside the U.S.
B. Close some or all correspondent or payable-through accounts
C. Ensure the inclusion of that country onto FATF’s Non-Cooperative Country and Territory list
D. Ensure the inclusion of that country into the office of Foreign Asset Control country sanctions programs
Answer: C
2.An employee hears a colleague on the telephone with a customer giving advice on how to ensure that a
suspicious transaction report will not be filed as a result of a future transaction.
What action should the employee take?
A. Report the conversation to the local police
B. Report the conversation to the compliance officer
C. Tell the colleague that it is against policy to give such advice
D. Ignore the situation because the colleague is the relationship manager for that customer
Answer: C
3.A branch manager for a small community bank has a new customer who deposits for EUR 50,000
checks into one account. Shortly thereafter, the customer goes to another branch and asks to transfer all
but EUR 1,500 to three accounts in different foreign jurisdictions.
Which suspicious activity should be the focus of the suspicious transaction report?
A. The customer opened the account with four large checks
B. The customer goes to a different branch to make this transaction
C. The customer transfers almost all of the funds out of the account
D. The customer asks to transfer funds to accounts in three different foreign jurisdictions
Answer: D
4.How can a financial institution verify the nature and purpose of a business and its legitimacy?
A. By reviewing a copy of the corporation’s latest audited reports and accounts
B. By undertaking a company search or other commercial inquires to see that the institution has not been,
or is not in the process of being dissolved of terminated
C. By reviewing the company’s website
D. By using an independent information verification process, such as by accessing public and private
databases
Answer: D
5.Which three procedures should a compliance officer looking to revise an institution’s CTF efforts include
in accordance with the Wolfsberg Group’s Statement on the Suppression of the Financing of Terrorism?
A. Consulting applicable lists and taking appropriate actions to determine if customers appear on such
lists
B. Reporting matches from lists of known or suspected terrorists to relevant authorities
C. Maintaining customer information to facilitate timely retrieval of such information
D. Reviewing only original identification documents when verifying customers
Answer: A,B,C
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Explanation:
UNUSUAL CUSTOMER IDENTIFICATION CIRCUMSTANCES
• Customer furnishes unusual or suspicious identification documents or declines to produce originals for
verification."
6.Which method is used to launder money in casinos?
A. Purchase chips with cash and play at a table
B. Purchase chips with cash and redeem for cash
C. Purchase chips with cash and redeem for a check
D. Purchase chips with cash and sell to another person for cash
Answer: C
7.A businessman requests a European private bank to open a numbered or alternate name account.
According to the Basel Committee on Banking Supervision principles, which of the following is the most
important question the banker should ask?
A. Who will control the account?
B. Who will inherit the proceeds in the event of the businessman's death?
C. How much money will be deposited into the account?
D. What account-opening date should I record'!'
Answer: B
8.Why are Money Services Business (MSBs) frequently accused of being high risk for money laundering?
A. A MSB should be used to hide money from a regulated entity
B. MSBs generally charge lower commission rates than banks charge making them attractive to criminals
C. MSBs can route funds to more high risk countries than banks
D. MSBs are subject to regulatory scrutiny which varies greatly from country to country
Answer: B
9.A bank maintains a relationship with a customer who owns a small bakery business.
Which customer action indicates potential money laundering?
A. The customer continually makes regular cash deposits
B. The customer has multiple bank accounts at several locations
C. The customer purchased property insurance that is twice the value of the business
D. The customer recently wired a large amount to a foreign jurisdiction where family is located
Answer: D
10.Which requirement is included in the Fourth European Union Directive on money laundering?
A. It requires obliged entities to consider politically exposed persons as high risk for life
B. It requires obliged entities to conduct enhanced due diligence on all prepaid card holders
C. It requires member countries to maintain registries of the beneficial owners of legal entities
D. It requires member states to enact economic sanctions against countries that do not cooperate with
Financial Action Task Force recommendations
Answer: C
Explanation:
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Reference: https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:32018L0843&from=EN
11.A suspicious transaction report filed on a car dealer structuring deposits initiates a criminal
investigation. The dealer changes branches and begins placing transactions with a frontline
employee to whom the dealer has given numerous gifts.
This employee handles all of the dealer's structured deposits and does not report the suspicious activity
internally.
The competent authority has advised the anti-money laundering specialist to avoid tipping off the
employee until the investigation is finalized.
What action should the specialist take next?
A. Recommend the immediate termination of the employee.
B. Advise that the dealer's accounts should be closed.
C. Consult with senior management and the legal advisor.
D. Inform the institution's regulatory agency of the situation.
Answer: D
12.What are two requirements with respect to supporting documentation that is used to identify potentially
suspicious activity, according to Financial Action Task Force? (Choose two.)
A. It must be retained for at least five years
B. It must be retained for at least seven years
C. It must be kept in a manner so that it can be provided promptly
D. It must only be released to the government through a subpoena process
Answer: A,C
Explanation:
Reference:
https://www.fatf-gafi.org/media/fatf/documents/recommendations/pdfs/FATF%20Recommendations%202
012.pdf
13.In general, what is an element that a financial institution or business does not have to specifically
address in an anti-money laundering program?
A. A system of internal policies, procedures and controls
B. A designated compliance officer with day-to-day oversight over the AML program
C. An ongoing employee training program
D. A description of its OFAC program to address government watch list screening
Answer: D
14.A politically exposed person (PEP) maintains an account at a bank. Last month a money laundering
analyst filed a suspicious transaction report about unusual wire deposits originated by unknown
individuals in the home country of the official.
To whom should this situation be escalated?
A. The board of directors
B. The line of business executive
C. The bank’s anti-money laundering officer
D. The Financial Action Task Force’s PEP Hotline
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Answer: C
15.The branch manager notices that a number of customers come in weekly and always use the same
teller to process their deposits. The manager notices that the customers and the teller, who are from the
same ethnic group, are speaking in a foreign language and every once in a while the customers from local
ethnic restaurants will bring the teller lunch. The commercial customers that visit the teller generally
deposit the same amount of cash each time they come in.
How should the branch manager respond to this activity?
A. Transfer the teller to another branch
B. Conduct further investigation before taking any other action
C. Encourage the teller to bring in more business from the ethnic community
D. Suggest to the teller to send the customers to other tellers to avoid the opportunity for collusion
Answer: B
16.When should the anti-money laundering risk assessment be updated?
A. Every two years
B. After a merger or acquisition
C. When the board of directors changes
D. When instructed to by the Financial Action Task Force
Answer: B
Explanation:
Evaluating the risk scoring model and conducting the risk assessment itself may need to be performed
annually, every eighteen to twenty-four months, before the launch of a new product, or when an
acquisition of another financial institution occurs.
Reference:
https://www.wolfsberg-principles.com/sites/default/files/wb/pdfs/faqs/17.%20Wolfsberg-Risk-Assessment
-FAQs-2015.pdf (10)
17.A compliance officer at an insurance company has been reviewing the transaction activity of several
clients.
Which transaction is considered a red flag for potential money laundering?
A. A client paid the quarterly life insurance premium using money orders from two different banks.
B. A client from a high-risk jurisdiction recently purchased property insurance for a real-estate
development.
C. A corporation owns several affiliates and recently opened separate group life insurance policies for
each of the affiliates.
D. A client established a $100,000 charitable annuity with a non-profit organization that provides health
and safety assistance internationally.
Answer: A
Explanation:
https://www.naic.org/documents/committees_d_antifraud_meetingcc_faqsinsurance_10310 5.pdf
18.When creating an anti-money laundering program for a foreign bank with branches in the United
States, which of the following are included among the four minimum elements required under the USA
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PATRIOT Act?
1. The development of a Know Your Customer program.
2. An ongoing employee training program.
3. The designation of a compliance officer.
4. An independent audit function to test the program.
A. 1, 2, and 3 only
B. 1, 2, and 4 only
C. 1, 3, and 4 only
D. 2, 3, and 4 only
Answer: B
19.What is the currency threshold under the European Union Fourth Anti-Money Laundering Directive?
A. 3,000 Euros
B. 5,000 Euros
C. 10,000 Euros
D. 15,000 Euros
Answer: C
Explanation:
Reference: https://www.acams.org/aml-resources/eu-fourth-aml-directive/
20.An offshore company is owned by four equal partners that reside in separate jurisdictions. One partner
presents an authenticated power of attorney apparently executed by the remaining three partners in his
favor and requests that a bank account be opened on behalf of all partners. He needs this done quickly
because there is a large deposit pending. The account-opening officer contacts the bank's anti-money
laundering officer for advice.
Which of the following should the anti-money laundering officer advise as an initial step?
A. Verify the identity of all the partners.
B. Verify the source of the deposit.
C. File a suspicious transaction report with the appropriate Financial Intelligence Unit.
D. File a suspicious transaction report with the Egmont Group.
Answer: C
21.What is a major economic consequence of money laundering through the use of front companies?
A. Placing more emphasis on manufacturing
B. Weakening of the legitimate private sector
C. Creating a more competitive pricing environment
D. Aligning management principles between criminal enterprises and legitimate businesses
Answer: B
Explanation:
Undermining the Legitimate Private Sector: One of the most serious microeconomic effects of money
laundering is felt in the private sector. Money launderers are known to use front companies: businesses
that appear legitimate and engage in legitimate business but are in fact controlled by criminals who
commingle the proceeds of illicit activity with legitimate funds to hide the ill-gotten gains. These front
companies have a competitive advantage over legitimate firms as they have access to substantial illicit
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funds, allowing them to subsidize products and services sold at below market rates. This makes it difficult
for legitimate businesses to compete against front companies. Clearly, the management principles of
these criminal enterprises are not consistent with traditional free market principles, which results in further
negative macroeconomic effects
Reference: http://people.exeter.ac.uk/watupman/undergrad/rtb/effects2.htm
22.Findings from a regulatory examination report states that the job descriptions of personnel outside of
the compliance department do not include references to anti-money laundering responsibilities.
Which action should the firm take?
A. Update all job descriptions to include anti-money laundering responsibilities
B. Respond that only compliance personnel have anti-money laundering responsibilities
C. Send an email to all staff stating that personnel must observe the anti-money laundering policy
D. Reply that a description of anti-money laundering responsibilities is included in the annual training
Answer: D
23.A compliance officer learns from an Information Technology (IT) source of a potential new financial
service being discussed by the new product approval committee.
What is the correct next course of action?
A. Request that the new product approval committee include the compliance officer.
B. Go to the board of directors and try to shut the new service down immediately because the committee
did not communicate with the compliance officer.
C. Get as much information as possible from the source so that potential risks can be researched and a
report prepared and presented to the head of marketing.
D. Start initial research into potential risks but wait until notified that the service has been approved by the
committee before initiating extensive research.
Answer: A
24.According to the Financial Action Task Force 40 Recommendations, Designated Non-Financial
Businesses and Professionals include which entities?
A. Commodities traders
B. Money services businesses
C. Hawala operators
D. Real estate agents
Answer: D
Explanation:
Reference:
http://www.fatf-gafi.org/media/fatf/documents/recommendations/pdfs/FATF%20Recommendations%20(a
pproved%20February%202012)%20reprint%20May%202012%20web%20version.pdf (page19, DNFBPs:
customer due diligence, bulleted point (b))
25.Which of the following provides anti-money laundering specialists information related to money
laundering trends?
1. Egmont Group's 100 Cases
2. Financial Action Task Force Typologies
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3. FinCEN's SAR Activity Review
4. The Wolfsberg Principles
A. 1, 2, and 3 only
B. 1, 2, and 4 only
C. 1, 3, and 4 only
D. 2, 3, and 4 only
Answer: C
26.Transfers of money over the last 6 months to a corporation in a jurisdiction with strict secrecy laws
triggered an alert.
Which of the following should cause the most suspicion of money laundering?
A. The jurisdiction is a known tax haven.
B. The company has bearer shares.
C. The corporation director is a European citizen.
D. No financial statements have been filed for 3 years.
Answer: A
27.In many jurisdictions, financial institutions are prohibited from hiring a person who has been convicted
of what type of offense?
A. Kidnapping
B. Offenses involving dishonesty
C. Driving while under the influence
D. Protests of government action
Answer: B
Explanation:
Reference: http://www.capitol.hawaii.gov/hrscurrent/vol07_ch0346-0398/HRS0378/HRS_0378-0003.htm
(See 9th point)
28.Which three methods are commonly used by an accountant to launder money? (Choose three.)
A. Representing a client court
B. Understanding income to take a tax loss
C. Overstating income to hide excess cash
D. Acting as a conduit for transferring cash between accounts
E. Acting as a designee for someone who wishes to hide their identity
Answer: C,D,E
Explanation:
https://www.ojp.gov/pdffiles1/Digitization/119840NCJRS.pdf
29.The USA PATRIOT Act requires United States (U.S.) financial institutions to collect certain information
from non-U.S. banks that hold a correspondent account.
Which two pieces of information must a non-U.S. bank provide to its U.S. correspondent to enable them
to comply with this requirement? (Choose two.)
A. The name and address of all shell banks the bank maintains accounts for
B. The name and address of all beneficial owners who own 25% or more of the bank
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C. Prompt notice of any suspicious activity it detects on any customer who uses the correspondent
account
D. The name and address of a U.S. person who is authorized to receive service of legal process for the
bank
Answer: B,C
Explanation:
Reference: https://www.sec.gov/about/offices/ocie/amlsourcetool.htm
30.In the summer, an institution identifies anti-money laundering concerns regarding a customer’s
account activity. The customer, an ice cream, has deposited a lot of checks drawn on banks in foreign
countries, sent large number of high dollar international wires to different countries, made cash deposits
of a few hundred
dollars every few days and written multiple checks for a few hundred dollars to the same dozen payees
every two weeks.
Which two transaction types warrant investigation? (Choose two.)
A. Regular cash deposits
B. The wires to foreign countries
C. Repeated checks to the same payees
D. Checks drawn on banks in foreign countries
Answer: B,D
31.The compliance officer for a private bank has been tasked with writing a policy on how the bank will
deal with intermediaries.
Which two aspects should be included in the policy in respect of intermediaries to align it with the
Wolfsberg Anti-Money Laundering Principles for Private Banking? (Choose two.)
A. When an intermediary introduces clients to the bank, it is not necessary for the bank to perform due
diligence on the intermediary’s clients.
B. Where an intermediary introduces clients to the bank, the bank must obtain the same type of
information with respect to an introduced client that would otherwise be obtained by the bank, absent the
involvement of the intermediary.
C. Where an intermediary manages assets on behalf of a number of clients and is the account holder with
the bank, but that intermediary does not conduct the same level of due diligence as the bank, it is
necessary for the bank to undertake due diligence on the intermediary’s clients.
D. Where an intermediary manages assets on behalf of a number of clients and arranges for the opening
of accounts for its clients with the bank, and that intermediary is a financial institution subject to similar
regulations, it is necessary for the bank to perform due diligence on the intermediary’s clients.
Answer: B,D
Explanation:
Reference:
https://www.wolfsberg-principles.com/sites/default/files/wb/pdfs/faqs/20.%20Wolfsberg-FAQs-on-Interme
diaries-May-2012.pdf (2)