ACFE CFE-Fraud-Prevention-and-Deterrence Exam - Topic 2 Question 64 Discussion

Actual exam question for ACFE's CFE-Fraud-Prevention-and-Deterrence exam

Question #: 64
Topic #: 2

[All CFE-Fraud-Prevention-and-Deterrence Questions]

During an external audit of an organization's financial statements. Peter, the external auditor, uncovers significant internal control deficiencies at the audit client's organization. He believes these deficiencies could result in a material misstatement of the financial statements. Which of the following should Peter do with regard to these findings?

APeter should make a public announcement that he is withdrawing from the audit engagement.

BPeter should provide a written communication about the findings to those charged with governance.

CPeter should report the findings in writing directly to the appropriate regulatory agencies

DPeter should discreetly work with senior management to correct the underlying internal control deficiencies.

Show Suggested Answer

Suggested Answer: B

by Janine at Mar 30, 2023, 08:06 PM

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Sabra

4 months ago

Working with management sounds risky; they might not fix it.

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Elfriede

4 months ago

Not sure if he should go public right away, though.

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Louis

4 months ago

Surprised he found significant deficiencies! That's a big deal.

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Carin

5 months ago

I agree, option B is the right move here.

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Brianne

5 months ago

Peter should definitely communicate the findings to governance.

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Vicki

5 months ago

I feel like option D seems too informal; I don't think he should just work with management without reporting it first.

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Yong

5 months ago

I'm a bit uncertain about whether Peter should go straight to regulatory agencies or if he should first inform management.

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Wai

5 months ago

I remember a practice question where the auditor had to report significant deficiencies, and I think option B aligns with that.

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Buffy

5 months ago

I think Peter should definitely communicate the findings to those charged with governance, but I'm not entirely sure if it should be written or just verbal.

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Deangelo

5 months ago

Alright, time to put on my troubleshooting hat. From the looks of it, the issue is with the guest shell's network configuration, so I'd focus on options that address DNS, gateways, and nameservers. B and D seem like the most likely candidates to resolve this problem.

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Estrella

5 months ago

Hmm, I'm a bit unsure about this one. I know send logging is important, but I'm not sure which specific setting or configuration is required. I'll need to think this through carefully.

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Gaston

5 months ago

I remember discussing Cisco DNA Center in the context of managing the architecture, but not if it's part of the overlay itself.

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Barrie

5 months ago

I think the answer is C. The child is making a verbal response to get access to the desired items, which fits the definition of a mand.

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Rosalind

10 months ago

I'm going with Option C. Reporting the findings directly to regulatory agencies is the best way to ensure these issues are taken seriously and properly addressed.

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Elfriede

10 months ago

Option D might be tempting, but it's not the right way to go. Peter shouldn't be secretly working with management, that could be seen as collusion.

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Asha

9 months ago

Peter should communicate the deficiencies to the audit committee or those charged with governance.

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Catalina

9 months ago

Peter should consider issuing a qualified opinion on the financial statements.

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Lauran

9 months ago

Peter should discuss the deficiencies with the audit client's management.

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Wilford

10 months ago

I agree with Option B. Peter needs to let the appropriate people within the organization know about these internal control issues so they can be addressed properly.

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Daron

9 months ago

Option C: Peter should keep the deficiencies to himself and not disclose them to anyone.

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Ahmed

9 months ago

Option B: Peter should communicate the deficiencies to the appropriate levels of management within the organization.

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Glenn

9 months ago

Option A: Peter should ignore the deficiencies and continue with the audit.

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Glenna

11 months ago

Whoa, Option A? That's like throwing the baby out with the bathwater. Peter shouldn't be making any public announcements, that's just going to cause chaos.

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Dominque

8 months ago

Peter should evaluate the implications of the deficiencies on the audit report and consider the need to modify the audit opinion.

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Phil

8 months ago

Peter should communicate the deficiencies to the audit committee or those charged with governance.

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Leonardo

9 months ago

Peter should consider the impact of the deficiencies on the financial statements and determine if adjustments are necessary.

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Effie

9 months ago

Peter should discuss the deficiencies with management and request additional information.

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Lawrence

9 months ago

Peter should evaluate the severity of the deficiencies and consider the need to modify the audit opinion.

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Buck

9 months ago

Peter should communicate the deficiencies to the audit committee and discuss the potential implications.

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Glory

9 months ago

Peter should consider the impact of the deficiencies on the financial statements and determine if adjustments are necessary.

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Ashley

10 months ago

Peter should discuss the deficiencies with management and request additional information.

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Lenny

11 months ago

Option B seems like the most appropriate course of action. Communicating the findings to those charged with governance is the ethical and professional way to handle this situation.

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