Can I please get help with the attach file? See attach.

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Summer 2016 ACCT 436 6380 EXAM 2 Instructions: Exam 2 for ACCT 436 includes material covered during the weeks 4 and 5 of the class in reading materials, assignments and other class discussions. The Exam has 20 multiple choice questions (3 points each for 60 points), 5 True or False questions (2 points each for 10 points), and 3 essay type questions (10 points each for 30 points) for a total of 100 points. This Exam paper has 7 pages including instructions page and an attachment. See the questions in the following pages. 'Exam 2' carries 10% of the Course Grade. Your response to the Exam 2 should be in a separate word document titled 'Exam 2_your Last Name' posted in the assignments folder Be sure to include your name in the document also. In your exam submission, For multiple choice/True or False questions, enter the question number and letter of your choice; Do not repeat the entire question For essay questions, while there is no minimum length, I anticipate one page (single spaced, Arial 10 or Times New Roman 12 font) for each question. No penalty for marginally longer submissions. I would look for clear and well-argued submissions showing your depth of knowledge and understanding of the concepts studied. Check grammar and spelling before submission. Best of Luck! Sathya Vardhana 1 EXAM 2 I. Multiple Choice Questions (20X3 = 60 Points) 1. Major fraud identified in HealthSouth Corporation's case related to A. B. C. D. Fund transfers to offshore banks Unusual related-party transactions Fictitious earnings Improper asset valuations 2. Advantages of using Internal Audit Data Analytics includes all but which of the following? A. B. C. D. Continuous auditing Utilization of Cloud Computing Increased efficiency Ability to test 100% of the population 3. The possibility that a sample drawn will provide the results that are not representative of the population is called A. B. C. D. Nonsampling error Nonstatistical error Sampling error Extrapolation error 4. Which of the following is the least persuasive form of evidence? A. B. C. D. Vendor's invoice issued to the client and obtained from the client Mathematical computation made by the auditor Client bank statement obtained directly from the bank Invoice issued by the client and obtained directly from the client 5. Audit Evidence is generally considered sufficient when: A. B. C. D. It is relevant, reliable and free from bias It is competent There is enough of it to support well-founded conclusions It has been obtained from a client 2 6. Which of the following is the most common method by which occupational frauds are initially detected? A. B. C. D. Management Review Tip Internal Audit External audit 7. Advantages of Statistical sampling do not include A. Sample results are objective and defensible B. Conclusions may be drawn regarding an entire population of data C. Exact information can be obtained about a population of items based on just a sample D. Audit coverage of multiple locations is often more convenient 8. Calculating the gross margin for the current year under audit as a percent of sales and comparing it with previous years is what type of evidence? A. B. C. D. Analytical procedures Observation Inquiry Vouching 9. Which of the following controls would likely prevent purchasing officers from favoring specific suppliers? A. Using auto-generated purchase order numbers B. Rotating buyer assignments periodically C. Management review of the consolidated report of total monthly spend by each buyer D. Requiring buyers to specify detailed material specifications 10. Who has the overall responsibility for the design and implementation of a fraud risk management program in a Company? A. B. C. D. Internal Audit function External auditors A designated Committee of the Board Management 3 11. Which one of the following not a statistical sampling method A. B. C. D. Monetary unit sampling Attribute sampling Haphazard sampling Stratified sampling 12. Which of the following is not likely to be a IT-related fraud? A. B. C. D. Theft off information through USB devices Illegal use of software Frequent or unusual related party transactions Abuse of company information by an employee through ineffective access controls 13. CAATTs refers to A. B. C. D. Controls And Audit Tricks in Technology Computer Assisted Audit Tools and Techniques Computer Accounting and Auditing Technology Tools An endangered species of animals 14. Which of the following is not a method of fraud in payroll process? A. B. C. D. Payment of fictitious expenses Inflating actual hours worked for an employee Generating payment vouchers for ghost employees Issuing duplicate payroll vouchers 15. Once an internal auditor is able to determine how a fraud took place, he/she should assess the facts to do all of the following except: A. Determine why the system of internal control did not prevent or detect the fraud. B. Immediately report the fraud to the local police or district attorney. C. Design suitable audit tests to help locate the existence of similar frauds in the future D. Advise other internal auditors within the company to be alert to this type of fraud. 16. Which of the following is the world's largest anti-fraud organization and premier provider of anti-fraud training and education. A. B. C. D. COSO GAO ACFE PCAOB 4 17. Appropriateness of evidence is a measure of the: A. B. C. D. Quantity of evidence. Quality of evidence. Sufficiency of evidence. Meaning of evidence. 18. Which one of the following is not an audit procedure for obtaining audit evidence? A. B. C. D. Inquiry Inspection Recalculation Assessing Control risk 19. Red flags or warning signs that alert auditors to the possibility of fraud by employees include all of the following except A. B. C. D. Not taking vacations Providing training to other staff Living a life style that is expensive considering one's salary Being under unusual financial pressure due to serious personal debts 20. KPMG's Top 10 key risks in 2015 for Internal Audit includes all but which one of the following? A. B. C. D. Third Party Relationships Regulatory Compliance CAE Reporting relationships Talent recruitment and retention 5 II. True or False (5X2 = 10 Points) 1. Embezzlement is the unlawful conversion of assets by an individual entrusted with them. A. True B. False 2. The IIA Internal Audit Standards prescribe that the internal audit activity must evaluate the potential for the occurrence of fraud and how the organization manages fraud risk. A. True B. False 3. Monetary Sampling is a type of judgmental sampling. A. True B. False 4. Whistleblower hot line is an effective measure to prevent fraud. A. True B. False 5. The auditor must plan and perform audit procedures to obtain sufficient appropriate audit evidence to provide an absolute basis for his or her opinion. A. True B. False C. 6 III. Essay Questions (3X10 = 30 Points) 1. Discuss in your own words why internal auditors often fail to detect frauds. You should discuss a minimum of four reasons. 2. With the help of a suitable example, explain various steps in deploying Attribute Sampling in testing to evaluate internal controls over many transaction items. 3. Read the attached article on 'Budgeting for Analytics'. You can also access it by the following link: https://iaonline.theiia.org/2015/budgeting-for-analytics#.V2bBvzhZi9A Summarize the article and discuss how an internal audit department can determine the level of data analytics to use for an engagement. ***** 7