1. Which of the following is not a control activity (procedure)?
a. System of authorizations.
b. Appropriate hiring procedures.
c. Independent checks.
d. Documents and records.
e. All of the above are control activities.

2. Which of the following is not a common vice that motivates people to commit fraud?
a. Gambling.
b. Drugs.
c. Expensive extramarital relationships.
d. Alcohol.
e. All of the above are vices that motivate people to commit fraud.

3. Which of the following is not a way that management can establish a good control environment?
a. Having a clear organizational structure.
b. Proper training.
c. Communicating openly.
d. Appropriate hiring procedures.
e. All of the above are ways that management can establish a good control environment.

4. Which of the following is not an element of most frauds?
a. Taking the assets.
b. Concealment.
c. Breaking and entering.
d. Conversion.

5. Which of the following is an example of legitimate power?
a. The offer of valuable stock options.
b. A decision to participate in fraud based upon fear.
c. Your boss tells you to do something.
d. You do something because your colleague is more knowledgeable than you are in that particular subject matter.

6. Which of the following is an example of referent power?
a. Fear that you may lose your job.
b. Your friend asks you to do a special favor for him or her.
c. The offer of a job promotion.
d. Your teacher asks you to do an assignment.