IIA-ACCA Exam - Topic 7 Question 72 Discussion

Actual exam question for IIA's IIA-ACCA exam

Question #: 72
Topic #: 7

An internal auditor has been asked to conduct an investigation involving allegations of independent contractor fraud. Which of the following controls would be least effective in detecting any potential fraudulent activity?

AException report identifying payment anomalies.

BDocumented policy and procedures.

CPeriodic account reconciliation of contractor charges.

DMonthly management review of all contractor activity.

Show Suggested Answer

Suggested Answer: C

by Noah at Mar 20, 2024, 10:54 AM

Limited Time Offer

25%

Off

Get Premium IIA-ACCA Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

Submit Cancel

Aretha

4 months ago

D is probably the least effective control here.

upvoted 0 times

...

Gregoria

4 months ago

Periodic reconciliations are a must-have!

upvoted 0 times

...

Leota

4 months ago

Monthly reviews? Really? I doubt they catch everything.

upvoted 0 times

...

Shannon

5 months ago

I think documented policies are crucial too.

upvoted 0 times

...

Merissa

5 months ago

Exception reports are super useful for spotting fraud!

upvoted 0 times

...

Mozell

5 months ago

Monthly reviews seem proactive, but I wonder if they could miss subtle fraud compared to more direct controls like reconciliations.

upvoted 0 times

...

Rocco

5 months ago

I practiced a question similar to this, and I feel like periodic reconciliations would be more effective than just having policies in place.

upvoted 0 times

...

Daniela

5 months ago

I think documented policies are important, but they don't actively detect fraud, right? They just set the framework.

upvoted 0 times

...

Amber

6 months ago

I remember we discussed how exception reports can be really useful for spotting anomalies, but I'm not sure if they catch everything.

upvoted 0 times

...

Lynda

6 months ago

Based on my understanding of fraud detection, the monthly management review of all contractor activity would be the least effective. It's too high-level and infrequent to catch any specific instances of fraud.

upvoted 0 times

...

Annice

6 months ago

I'm a bit stumped on this one. All the options seem like they could be effective in their own way. I'll have to think it through carefully before making a decision.

upvoted 0 times

...

Micheline

6 months ago

I've got a good feeling about this one. The exception report identifying payment anomalies seems like the most obvious control to detect any shady activity by the contractors.

upvoted 0 times

...

Viva

6 months ago

Hmm, this is a tricky one. I'm thinking the least effective control would be the documented policy and procedures since those can be easily overlooked or ignored by determined fraudsters.

upvoted 0 times

...

Tammy

6 months ago

This question seems straightforward, but I want to make sure I understand the context correctly. Detecting fraud by independent contractors is the key focus, right?

upvoted 0 times

...

Titus

6 months ago

Okay, I think I've got this. The key is to identify which options involve the VM being powered on or off when adding/reducing resources. That should help me determine the right prerequisites.

upvoted 0 times

...

Bev

6 months ago

Okay, I've got this. The valid version statuses are "Working" and "Submitted". Those are the ones that let you run batch validations and fix any issues before exporting to target systems.

upvoted 0 times

...

Gianna

6 months ago

Hmm, I'm a bit torn between options A and B. Both annotations and resource tags could work, but I'm wondering if a resource tag might be a bit more flexible and easier to manage in the long run. I'll probably go with option B, but I'll double-check the documentation just to be sure.

upvoted 0 times

...

Barrett

10 months ago

I'm going with the documented policy and procedures. Who needs controls when you can just have a nicely written document telling people not to be naughty?

upvoted 0 times

Fredric

9 months ago

C) Periodic account reconciliation of contractor charges.

upvoted 0 times

...

Shenika

9 months ago

B) Documented policy and procedures.

upvoted 0 times

...

Emogene

9 months ago

A) Exception report identifying payment anomalies.

upvoted 0 times

...

Meaghan

11 months ago

Periodic account reconciliation? Pfft, that's too much work. I'm going with the exception report - let the computer do all the heavy lifting, am I right?

upvoted 0 times

Martina

9 months ago

User 3: I think having both the exception report and periodic account reconciliation would be the most effective approach.

upvoted 0 times

...

Rupert

9 months ago

User 2: But what if the fraud is happening in between the exceptions? Maybe the periodic account reconciliation is necessary.

upvoted 0 times

...

Fanny

9 months ago

User 1: I agree, the exception report is definitely the easiest option.

upvoted 0 times

...

Isreal

10 months ago

User 3: Monthly management review could also be helpful in detecting fraud.

upvoted 0 times

...

Stephen

10 months ago

User 2: But what about the importance of documented policies and procedures?

upvoted 0 times

...

Audrie

10 months ago

User 1: I agree, let the computer do the work with the exception report.

upvoted 0 times

...

Aleisha

11 months ago

Hah, these auditors are really trying to trip us up! I bet they're sitting back laughing at all the poor souls who fall for the 'least effective' trap.

upvoted 0 times

...

Edna

11 months ago

I'd say the monthly management review is the least effective. Fraudsters are usually pretty clever at covering their tracks, so that might not catch much.

upvoted 0 times

...