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WC029 – Top 5 financial accounting fraud

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Webclass 29: Replay and PDF
Webclass 29: Take the quiz and get your CPE certificate

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- Webclass 29 Quiz: TOP 5 Financial Accounting Fraud

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Webclass 29: Secret number

Participants 13

Bee
Be
admin
Claire
Hanh Huynh

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Webclass 29 Quiz: TOP 5 Financial Accounting Fraud

admin June 9, 2026

WC029 – Top 5 financial accounting fraud
Webclass 29: Take the quiz and get your CPE certificate
Webclass 29 Quiz: TOP 5 Financial Accounting Fraud

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Question 1 of 11

1. Question

Q1. According to Claire, how was the Worldcom scandal uncovered?

By internal audit reviewing journal entries
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By top management resigning
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Question 2 of 11

2. Question

Q2. The first time that the auditors present the journal entries to management, does management admit straight away that there is a problem?

No, they explained it as normal "prepaid capacity"
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Yes, they admitted straight away to the auditors that there was a problem
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Question 3 of 11

3. Question

Q3. When we want to reduce Loss (P&L), we should post it on the debit or credit side of the journal entry?

Credit
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Debit
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Question 4 of 11

4. Question

Q4. Worldcom increased their retained earnings by increasing the amount of revenue that should be posted

False
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True
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Question 5 of 11

5. Question

Q5. What was a motivating factor for the Worldcom management to “cook the books”?

Expenses versus revenue ratio was poor
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Stock price can be influenced by poor ratios such as expenses versus revenue
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So that management could misappropriate inventory
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Question 6 of 11

6. Question

Q6. Assets increase on debit and liabilities increase on credit

True
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False
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Question 7 of 11

7. Question

Q7. Which ratios does Claire mention as being important?

Current receivables/ current liabilities
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Accounts receivable/ net sales
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Net sales/ cost of sales
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Fixed assets/ cost
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Question 8 of 11

8. Question

Q8. How might we increase Accounts Receivable?

Book deferred revenue early
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Book customer invoices early
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Decrease the amount of cost booked in the period
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Question 9 of 11

9. Question

Q9. How might we reduce Current Liabilities?

Post supplier invoices late
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Credit-debit refresh on ageing customer accounts
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Stock OUT-IN refresh on inventory
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Net-off accounts payable to a suspense account
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Book loss on debit and profit on credit
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Question 10 of 11

10. Question

Q10. Select the steps that Claire follows when using an example USGAAP COA to identify strange accounting schemes

Make a cartesian product of basic US GAAP COA, in order to get all combinations of accounts with all accounts (which would represent all combinations of debit and credit within an accounting scheme)
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Mapping of the US GAAP COA to the local or group COA
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Flag the combinations of debit and credit accounts as those that would be considered to be strange accounting schemes
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Filter your local general ledger on journal entries that have an accounting scheme that is the same as those flagged as strange (taking the account on debit with the highest value and the account on credit with the highest value)
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Take a sample of journal entries at random from the entire population of journal entries
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Question 11 of 11

11. Question

Q11. What other journal entry data analytics are important, other than looking at the journal entry accounting schemes?

Posting in the wrong period
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Looking at unusual bank transactions/ matching the bank transactions to the bank statements
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High values pre-post closing
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Trends in manual journal entries: which accounting schemes that are unusual, who is entering them, when they are entered…
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Journal entries entered on the 1st of the month
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