Acams Advanced-CAMS-Audit Exam Questions Instant Access

Question 1

The auditor finds that the customer risk assessment (CRA) is completed at initial onboarding and is repealed for each customer every other year. The auditor's observations should Include that the CRA should:

Abe updated more often given the risk of the entity.

Binclude an assessment of jurisdiction where the customer currently resides as this may have changed.

Callow for sales oy third patties other than advisors since most of the customers are local residents.

Dinclude a qualitative overlay that 95% of the products offered are subject to regulatory exemptions.
Dynamic Nature of Customer Risk Assessment (CRA):
A comprehensive CRA should incorporate jurisdictional risks, as customer location changes could introduce new risks, such as exposure to high-risk or non-compliant jurisdictions.
FATF Recommendations on Risk-Based Approach:
Periodic updates to the CRA, including changes in customer location, align with FATF's risk-based approach and Recommendation 10.
Audit Observation Implications:
Omission of jurisdictional assessments could result in undetected risks, undermining the integrity of the AML program.

Answer : B

Question 2

Which findings indicate issues that would cause a lack of understanding of the risks associated with the business the financial institution conducts? (Select Three.)

AFinding 1

BFinding 3

CFinding 4

DFinding 5

EFinding 6

FFinding 8
Finding 1
This highlights fundamental gaps in the risk assessment process. A lack of clarity in identifying and analyzing risks associated with certain products, services, or client categories reflects an incomplete understanding of the business's risk landscape.
CAMS-Audit emphasizes the importance of comprehensive risk assessments to identify inherent and residual risks and align them with the institution's overall AML/CFT framework.
Finding 4
This pertains to inadequate integration of risk mitigation controls into operational processes, leading to blind spots in identifying emerging threats. Institutions that do not properly embed risk controls often fail to adapt to changing business or regulatory requirements.
Reference to FATF recommendations underlines the necessity of embedding controls that reflect ongoing and emerging risks.
Finding 8
Failure to implement effective monitoring mechanisms or maintain updated customer or transaction profiles suggests a superficial approach to understanding risk exposure. Without robust data tracking, financial institutions may overlook key risk indicators.
CAMS-Audit documents stress the need for effective transaction and customer profile monitoring systems as part of a sound risk-based approach.

Answer : A, C, F

Question 3

What is the role of the internal audit in the governance process?

APerform quality assurance testing of transaction monitoring.

BMonitor the risks of noncompliance with applicable laws and regulations.

CPeriodically evaluate the effectiveness of processes and controls.

DExecute the corrective action plan.
Role of Internal Audit:
Internal audit is tasked with evaluating and improving the effectiveness of governance, risk management, and control processes within the organization.
Periodic evaluations ensure that AML/CFT processes remain robust and effective against emerging risks.
Alignment with CAMS-Audit Guidance:
Advanced CAMS-Audit training highlights the need for internal audit to focus on process effectiveness rather than operational responsibilities, such as quality assurance or corrective actions.

Answer : C

Question 4

The mam characteristics of an AML program testing are:

Atailored and risk-based.

Bstandard and focused.

Cinnovative and evaluative.

Dremedial and interdependent.
Characteristics of Effective AML Program Testing:
Tailored: Custom-designed to address specific organizational risks.
Risk-Based: Prioritizes high-risk areas to ensure optimal resource allocation and compliance.
Alignment with CAMS-Audit and FATF Principles:
Both emphasize the importance of a risk-based approach to AML program evaluation to mitigate the most significant threats.

Answer : A

Question 5

Why is it crucial for the audit plan to consider the effectiveness of the AML risk assessment controls and risk mitigants?

AAudits need to approve the implementation of the controls and review testing outcomes.

BImproper identification and assessment of risk creates deficiencies resulting in an overall weakened AML compliance program.

CThere is a regulatory requirement for the audit to update the AML risk assessments on a continuous or specified periodic basis.

DStrict CDD rules promote high ethical and professional standards in the financial industry.

Answer : B

Question 6

If a final audit communication contains a significant error, the chief audit executive must:

Arecall the audit report assess the error and resubmit the correct one.

Breport the error to the local AML regulator.

Creevaluate the item(s) and resubmit findings for discussion on factual accuracy.

Dtell those who received the communication of the error and corrections.
A significant error in an audit report undermines the credibility of the findings. The appropriate action is to recall the report, reassess the error, and submit an accurate report to stakeholders. This ensures integrity and compliance with audit standards.

Answer : A

Question 7

An audit manager identifies that a financial institution (Fl) has not produced a business-level risk assessment in accordance with policy. The senior manager of the Fl assures that assessing risk at the individual client level and aggregating the data is an acceptable approach. How should the audit manager proceed?

AIssue a finding that requires the completion of a business-level risk assessment.

BAccept the risk conclusions provided by the senior manager.

CTest the accuracy of the mathematical aggregation of the risk assessments.

DDiscuss with the senior manager to establish the risk appetite.
Importance of Business-Level Risk Assessments:
Aggregating client-level risk assessments does not replace a comprehensive business-level risk assessment, which is required for holistic risk management.
Audit Manager's Responsibility:
The absence of a business-level risk assessment constitutes a policy violation and must be formally addressed through a finding.
CAMS-Audit Guidelines:
CAMS-Audit emphasizes the need for layered risk assessments, including enterprise-wide evaluations, to comply with regulatory standards.

Answer : A

Acams Advanced CAMS-Audit Certification Advanced-CAMS-Audit Exam Questions