Free ACFE CFE-Fraud-Prevention-and-Deterrence Practice Exam Questions and Answers 2026

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Total 360 Questions | Updated On: Apr 03, 2026

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Question 1

Which of the following Is NOT Included In Ihe five fraud risk management principles described In Fraud Risk Management Guide, a joint publication by COSO and the ACFE?

A : Communicating the expectations of those governing the fraud risk management program

B : Performing comprehensive fraud risk assessments to identify specific fraud schemes

C : Deploying preventive and detective fraud control activities to mitigate fraud risk

D : Developing one-time evaluations for each fraud risk management principle

Answer: D

Question 2

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 should assume that all audit evidence collected previously is unreliable and withdraw from the audit engagement

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

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

D : 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.

Answer: B

Question 3

Which of the following choices is an example of an anti-fraud control that is primarily preventive in nature?

A : Continuous audit techniques

B : Proactive data analysis techniques

C : Employee background checks

D : Whistleblower hotline

Answer: C

Question 4

Which of the following is a best practice when assembling a fraud risk assessment team?

A : Team members should all have similar skills and perspectives.

B : The size of the team should be limited to four individuals.

C : The team should include only external sources.

D : Team members should have experience in eliciting information.

Answer: D

Question 5

Trevino Ltd is a facility management company which is managing 12 high-rise buildings accross the city. Maintenance of those building accounts for a significant part of Trevino's budget. The company often outsource this service to third party providers. Which of the following can assist Trevino in managing the performance of these suppliers?

A : Stock turn rate

B : Just In Time (JIT)

C : Total cost of ownership

D : Service Level Agreement (SLA)

Answer: D

Page: 1 / 72

Total 360 Questions | Updated On: Apr 03, 2026

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