Acams Advanced-CAMS-Audit Exam Practice Test Instant Access

Question 1

During the auditing process the auditor finds that the entity never updates the customers risk assessment. Which remediation actions should the auditor suggest? (Select Two.)

ACompliance regularly updates the lists of high- and medium-risk countries to ensure updated customer risk profiles.

BAudit designates an audit manager to review customer profiles annually.

CDelete non-active customer profiles to reduce the workload of ongoing surveillance.

DManagement engages an independent third party to update all the customer risk profiles.

EThe business updates the customer risk profiles periodically in accordance with the customer risk level.
A: Regularly updating lists of high- and medium-risk countries ensures that customer risk profiles align with the most current geopolitical and economic risks.
E: Periodic updates to customer risk profiles, based on their assigned risk level, are critical for maintaining an accurate and dynamic risk assessment system.

Answer : A, E

Question 2

When assessing the KYC process which should an auditor observe from the customer risk assessment? (Select Two)

ASelf-declaration or Beneficial ownership should not be accepted as it is not adequate.

BOverseas shareholders not involved in the customer's dally operations are not beneficial owners.

CThe purpose and intended nature of the business relationship were not reviewed m the assessment.

DThe ultimate beneficial owners of the customer need to be Identified and verified.

EIf this was a face-to-face customer, the overall customer risk rating should be changed to low.
C: The purpose and intended nature of the business relationship are fundamental elements of customer due diligence (CDD) and should be reviewed in the risk assessment process to understand the rationale behind the customer's activities and their alignment with expected patterns.
D: Identifying and verifying the ultimate beneficial owners (UBOs) is a core principle of the KYC process to ensure transparency and mitigate risks related to hidden ownership or illicit activities.

Answer : C, D

Question 3

in addition to this investigation report, what Information should the auditor expect to find in the investigative file? (Select Two.)

ABoard approval for the suspicious activity report filing by the compliance department.

BIndependent review by the compliance officer's line manager.

CAdverse news search results against the customers and its controlling persons.

DPolicies and procedures relating to AML investigations and suspicious activity report filing.

EHistorical transaction data of the customer s account.
Adverse news provides context on potential risks associated with the customer, while historical transaction data is critical for understanding patterns that may indicate suspicious activity.

Answer : C, E

Question 4

As an auditor reviewing this investigation report, which indicates an effective process?

AThe compliance officer concluded the investigation approximately 3 months later and filed a suspicious activity report.

BThe compliance officer concluded from the report that there are reasonable grounds for suspicion and filed a suspicious activity report.

CThe compliance officer filed a suspicious activity report and omitted details regarding the reason it was filed.

DThe compliance officer decided not to cease the Business relationship hut kept the account under rigorous monitoring process.
Filing an SAR based on reasonable grounds for suspicion ensures compliance with AML obligations and demonstrates the effectiveness of the investigative process.

Answer : B

Question 5

Which products/services increase the risk level for money laundering for XYZ Bank?

APayable through accounts

BInternational fund transfers

CLetters of credit

DForeign exchange services
Payable through accounts allow foreign banks' customers direct access to the correspondent account, which can increase the risk of money laundering due to less direct oversight.

Answer : A, B

Question 6

A financial institution's (FI) risk assessment identified a lack of specific policies and procedures for existing privately-owned automated teller machine (ATM) customers. What would an auditor review to assess whether this risk has been addressed?

APrepare to audit a sample of the FI's privately-owned ATM customers.

BDraft policies and procedures for the FI's privately-owned ATM customers.

CRequest data on the volume and value of transactions through the privately-owned ATM customers.

DReview the current risk assessment to determine the existence of privately-owned ATM customers.
Reviewing the Risk Assessment:
A risk assessment reveals whether privately-owned ATMs are identified and properly evaluated in terms of potential AML risks.
Auditor's Task:
Confirm that specific policies and procedures are now in place to address identified risks from the previous assessment.
Relevance to CAMS-Audit Standards:
Risk assessments are fundamental in identifying gaps in policies and procedures for high-risk areas like privately-owned ATMs.

Answer : D

Question 7

While reviewing a sample of trade financing documents in a financial institution, an auditor notes that there were instances of potential overvaluation and undervaluation of goods. The auditor intends to check if these were detected and escalated. Which is a reason for such overvaluation and undervaluation?

ATo disguise dual-use goods

BTo trade prohibited goods

CTo move funds or value across national borders

DTo defraud shipping companies
Reason for Overvaluation/Undervaluation:
This technique is often used in trade-based money laundering to transfer funds or value disguised as legitimate trade transactions.
Auditor's Responsibility:
Auditors must ensure such discrepancies are detected, escalated, and adequately addressed to prevent money laundering.
CAMS-Audit Insight:
Advanced CAMS-Audit emphasizes vigilance in trade finance as a high-risk area for money laundering activities.

Answer : C

Acams Advanced-CAMS-Audit Advanced CAMS-Audit Certification Exam Practice Test