Accounting Q&A · Forensic Accounting · Topic 3
Practise 25 forensic accounting questions on manipulated reporting and theft indicators using five fictional investigation cases. Try each question before revealing the answer. Legal and reporting duties depend on the jurisdiction and engagement.
Revenue jumps in the last week of the year
1. What should the examiner establish?
Assess occurrence and cut-off.
2. Which records should the examiner obtain?
Obtain contracts, dispatch evidence and post-year-end credits.
3. What procedure would test the issue?
Test when control transferred for selected sales.
4. What alternative explanation or limitation matters?
A genuine seasonal spike can produce a similar pattern.
5. What should happen next?
Quantify unsupported revenue and examine similar entries.
Obsolete stock remains at full cost
6. What should the examiner establish?
Assess valuation and possible bias.
7. Which records should the examiner obtain?
Obtain ageing, sales prices and disposal costs.
8. What procedure would test the issue?
Compare carrying amounts with estimated net realisable value.
9. What alternative explanation or limitation matters?
Slow movement alone does not determine value.
10. What should happen next?
Document the estimate and any required write-down.
Employee refunds exceed the normal range
11. What should the examiner establish?
Assess possible diversion of cash.
12. Which records should the examiner obtain?
Obtain register logs, refund approvals and payment details.
13. What procedure would test the issue?
Match each refund to an original sale and recipient.
14. What alternative explanation or limitation matters?
A new returns policy may change the baseline.
15. What should happen next?
Escalate unexplained refunds and strengthen approvals.
Supplier invoices pay for services nobody can describe
16. What should the examiner establish?
Assess fictitious billing or undisclosed conflicts.
17. Which records should the examiner obtain?
Collect agreements, deliverables, approvals and ownership information where lawful.
18. What procedure would test the issue?
Verify services with independent personnel and records.
19. What alternative explanation or limitation matters?
An unfamiliar supplier name does not establish a sham.
20. What should happen next?
Document missing evidence and trace suspicious disbursements.
A manager records repairs as equipment
21. What should the examiner establish?
Assess whether capitalisation overstates assets and profit.
22. Which records should the examiner obtain?
Obtain invoices and inspect the nature of work.
23. What procedure would test the issue?
Compare the spending with applicable recognition criteria.
24. What alternative explanation or limitation matters?
A replacement component can qualify for capitalisation.
25. What should happen next?
Quantify the correction and test comparable entries.