Deck 9: Transforming Data Into Evidence

Question 1

A graph should always have a title.

Answer 1

True

Question 2

Which of the following is a feature of a normal distribution?

A) It is positively skewed.
B) Its mean, median, and mode are all equal.
C) It is completely described by its median and variance.
D) The normal distribution curve is s-shaped.

Answer 2

B

Question 3

Which of the following statements is true of the measures of variability?

A) Low variability indicates that the observations are located farther from the mean.
B) Two data sets can have the same number of observations and the same mean, median, and mode but have different variability.
C) Like the mean, the variance and standard deviation have the advantage of considering select observations in the data set.
D) Compared to the standard deviation, the variance is more easily interpreted because it is stated in terms of basic units.

Answer 3

B

Question 4

Microsoft Access forces some structure on the data analysis project.

Question 5

Audit software programs have high cost compared to basic programs and require extensive training to use them effectively.

Question 6

Which of the following categories of data can be displayed by a pie chart?

A) data that sum to a total
B) forensic data collected as evidence
C) qualitative data
D) time series data

Question 7

Which of the following describes the descriptive measure "median"?

A) It is the center point of the data set, when the observations are ordered by magnitude.
B) It is the average value calculated by adding all the observations and dividing by the number of observations.
C) It is the average of the squared deviations of the observations from the mean.
D) It is the most frequently occurring value.

Question 8

Which of the following terms describes a distribution that is more heavily weighted toward larger numbers?

A) negatively skewed
B) positively skewed
C) right-skewed
D) symmetrically skewed

Question 9

What does a positively skewed distribution mean?

A) The distribution is more heavily weighted toward larger numbers.
B) The median is lower than the mean, which is lower than the mode.
C) The distribution extends farther to the left than to the right.
D) The mean is greater than the median, which is greater than the mode.

Question 10

Which of the following statements is true of a bar graph display?

A) It is the same as a line graph.
B) It allows for more than one category of data to be presented on the same graph.
C) It is used to display qualitative data.
D) It cannot be used to chart multiple time series.

Question 11

A parameter is a measure that describes a sample.

Question 12

It is more difficult to identify significant deviations from Benford's profile in small data sets.

Question 13

According to Benford's Law,the distribution of first digits is negatively skewed.

Question 14

Which of the following is the first step in creating a histogram?

A) plotting the data
B) determining frequency of observations
C) defining the intervals
D) analyzing the data

Question 15

Which of the following is a reason why dynamic visual exhibits are utilized in a courtroom?

A) A long presentation is less likely to produce memorable highlights.
B) Visual tools bring a change in the pace of the presentation and prevent monotony.
C) It is easier to present data in a visual form than in words.
D) Information can be communicated more efficiently in visual form.

Question 16

Which of the following is an important dimension to be considered while evaluating the distribution of a data set?

A) accuracy of the data
B) changes in internal variables
C) timing of the distribution
D) skewness of the distribution

Question 17

Decreasing the occurrence of Type I errors increases the occurrence of Type II errors.

Question 18

Data mining can detect a fraudulent transaction with certainty.

Question 19

A bar graph cannot be used to chart multiple time series.

Question 20

A positive skewness is when the distribution is more heavily weighted toward smaller numbers.

Question 21

Which of the following is true of data mining?

A) Sorting is a form of data mining.
B) Data mining cannot be used for investment analysis.
C) Ratio analysis is a form of data analysis, not data mining.
D) Data mining can be used to identify all types of fraud.

Question 22

Which of the following ratios is known as the relative size factor?

A) ratio of the largest value to the smallest value
B) ratio of the largest (or smallest) value to the mean
C) ratio of the smallest value to the second-smallest value
D) ratio of the largest value to the second-largest value

Question 23

Which of the following is true of presenting data in a graph?

A) Descriptive labels for the two axes may or may not be used.
B) The title of the graph need not be given.
C) Labels for individual data points should always be included.
D) The right approach is to always use a scale that includes zero.

Question 24

Which of the following is a disadvantage of generalized audit software?

A) It cannot be customized for specific tasks.
B) It requires data to be converted to a format that can be processed by it.
C) It does support the creation of an audit trail or log.
D) It requires extensive training to use it effectively.

Question 25

Which of the following is a difference between the programs Microsoft Excel and Microsoft Access?

A) In Access, either a number or a formula can be entered into a cell, whereas Excel allows each field to store only one type of data for all the records.
B) In Access, it is not necessary to maintain consistency between column headings and the type of data contained in the column, whereas Excel requires it to be consistent.
C) In Access, a certain amount of structure is forced on the data analysis project, whereas Excel allows more flexibility in the project.
D) In Access, it is not possible to infer if a number appearing in a cell is data point or a calculation just by looking at it, whereas in Excel, the nature of the number is always clear.

Question 26

Which of the following is a basic data analysis program?

A) Microsoft Word
B) Microsoft Excel
C) Microsoft PowerPoint
D) Microsoft Organizer

Question 27

Which of the following is a bar chart,in which each bar represents a single interval and the height of the bar indicates the number of observations in the interval?

A) pie chart
B) histogram
C) line chart
D) distribution chart

Question 28

Which of the following is an example of numbers that display a geometric tendency?

A) Social Security numbers
B) stock prices
C) account numbers
D) zip codes

Question 29

Which of the following is a disadvantage of basic data analysis programs?

A) They do not allow flexibility of application.
B) They cannot accommodate data in certain formats, in which case the data must be converted.
C) They do not support complex statistical calculations or similar higher functions.
D) They are not suitable for forensic accounting engagements that require data mining.

Question 30

Which of the following is a reason why a forensic accountant uses data mining?

A) to generate population of data based on a small sample
B) to collect observations that may be presented as evidence of misrepresentation of information
C) to reduce a large number of observations to a smaller number that can be examined more closely
D) to assist in providing random samples from a large set of data

Question 31

Which of the following does the ratio of the smallest value to the second-smallest value identify?

A) a benchmark that can be tracked over time
B) an outlier on the opposite side of the distribution
C) a greater variation in the data set
D) the magnitude of the deviation

Question 32

Which of the following is true of Excel?

A) It does not require consistency to be maintained between column headings and the type of data contained in the column.
B) It has a well-defined structure that includes tables, queries, and reports.
C) In Excel, each field can store only one type of data for all the records.
D) In Excel, a useful feature known as the Database facilitates review of the database by another user or by the same user at a later time.

Question 33

Which of the following is Type I error in statistics?

A) a false positive
B) a miss
C) an incorrect sample
D) failure to identify a true signal

Question 34

Which of the following is the most common way to bias a graph?

A) by not including labels for individual data points
B) by not including labels for the axes
C) by manipulating the scale of the graph
D) by using a scale that starts from zero

Question 35

Which of the following is an advantage of generalized audit software?

A) It facilitates alteration of data.
B) It costs the same as basic programs and is more efficient.
C) It can directly access and analyze data inside the database.
D) It does not require extensive training to use it effectively.

Question 36

Which of the following is the first and primary means by which a graph communicates information?

A) label for data points
B) scale of axes
C) label of the axes
D) title of the graph

Question 37

Which of the following is true of data mining?

A) It cannot reflect the past behavior of the system being studied.
B) It cannot examine the relationships among various factors.
C) It cannot analyze an observation from multiple perspectives.
D) It cannot detect a fraudulent transaction with certainty.

Question 38

To conform to Benford's Law,a number series must approximately follow a

A) geometric sequence.
B) arithmetic sequence.
C) Fibonacci sequence.
D) decreasing sequence.

Question 39

Which of the following is true of Microsoft Access?

A) The data analysis functions can be enhanced with add-ins.
B) Each field can store multiple types of data for all the records.
C) The layout of Access is different from the layout of an Excel spreadsheet.
D) All data-related functions are applied through the creation of queries.

Question 40

A larger ratio of the largest value to the smallest value indicates

A) an outlier in the data set.
B) a lesser variation in the data set.
C) a greater variation in the data set.
D) an outlier on the opposite side of the distribution.

Question 41

Which of the following is a use of the last-two-digits test?

A) It narrows the range of transactions to be investigated.
B) It identifies round numbers which are red flags for invented numbers.
C) It indicates instances where digits have been transposed to make the number larger.
D) It flags numbers that are repeated frequently as possible fraudulent transactions.

Question 42

What is the purpose of data mining? Give examples of specific applications of data mining.

Question 43

Explain how a continuous distribution differs from a discrete distribution.

Question 44

What are the different data analysis tests which use Benford's Law to identify irregularities in data sets?

Question 45

Why important is it to include labels along with a graph?

Question 46

Which of the following is an advantage of the first-two-digits test?

A) It narrows the range of transactions to be investigated.
B) It identifies round numbers which are red flags for invented numbers.
C) It indicates instances where digits have been transposed to make the number larger.
D) It flags numbers that are repeated frequently as possible fictitious transactions.

Question 47

Which of the following is a reason why the size of the data set is important to apply Benford's Law?

A) Large data sets often have more irregularities than small data sets.
B) It is easier to test small data sets for frequencies of digits, both lower and higher.
C) It is more difficult to identify significant deviations from Benford's profile in small data sets.
D) The results of tests on large data sets are not as precise as the results of tests on small data sets.

Question 48

What are add-ins? What are the common add-ins that can be used with Excel?

Question 49

Which of the following is an example of numbers that does NOT follow Benford's Law?

A) city populations
B) stock prices
C) zip codes
D) company revenues

Question 50

Which of the following describes the profile for the first digit according to Benford's Law?

A) upward slope
B) U-curve
C) bell-curve
D) ski slope