Certified Fraud Examiner Digital Forensics and Technology Fraud Flashcards
6 cards from real CFE practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Certified Fraud Examiner Digital Forensics and Technology Fraud flashcards as text
Which data analysis technique involves comparing an organization's financial ratios to industry norms to identify anomalies suggesting fraud?
Answer: Ratio analysis
Ratio analysis compares key financial metrics against industry benchmarks or historical trends to identify unusual deviations that may indicate fraud or manipulation.
Benford's Law is most useful in fraud detection for analyzing which type of data?
Answer: Naturally occurring financial figures such as invoice amounts or expense reports
Benford's Law predicts the frequency distribution of leading digits in naturally occurring numerical data; deviations from this distribution in financial data can signal fabricated numbers.
In continuous auditing, what is the primary advantage of using automated exception reporting?
Answer: It allows real-time or near-real-time identification of transactions that fall outside defined parameters
Automated exception reporting continuously monitors transactions against predefined rules and immediately flags anomalies, enabling faster detection than periodic manual review.
Which analytical procedure involves tracing a transaction from its origin through all processing steps to the final recorded amount?
Answer: Tracing
Tracing follows a transaction forward from its source document through the accounting records to verify completeness and accuracy of recording.
Which type of analysis detects fraud by looking for duplicate invoice numbers, vendor addresses matching employee addresses, or payments just below approval thresholds?
Answer: Data mining or anomaly detection
Data mining and anomaly detection techniques systematically search large datasets for patterns such as duplicate payments, related-party conflicts, or threshold manipulation that indicate fraud.
A CFE reviewing network logs to detect unauthorized data exfiltration would most likely look for which indicator?
Answer: Large outbound data transfers to unknown external IP addresses at unusual hours
Large volumes of outbound data to unknown or unauthorized external destinations, especially during off-hours, are a primary indicator of data exfiltration by an insider threat or attacker.