Exam 12: Assessing Control Risk and Reporting on Internal Controls

Which of the following computer-assisted auditing techniques inserts an audit module in the client's application system to identify specific types of transactions?

When there are a number of controls tested in prior audits that have not been changed,auditing standard require auditors to test some of those controls each year to ensure there is a rotation of controls testing throughout the three-year period.

When a client uses a service center for processing transactions,

Narratives,flowcharts,and internal control questionnaires are three common methods of

Discuss the advantages and benefits of using generalized audit software.

Which of the following is a correct statement?

The text suggested a five-step approach to identify deficiencies,significant deficiencies,and material weaknesses.Describe this approach.

Which of the following is True regarding the auditor's opinion on the effectiveness of internal control?

In evaluating the operational effectiveness of internal controls,the auditor is likely to use four types of audit procedures.List the procedures below.

The employee in charge of authorizing credit to the company's customers does not fully understand the concept of credit risk.This lack of knowledge would

Which of the following is True regarding the relationship between tests of controls and procedures to obtain an understanding?

Control risk is generally set at minimum for most private companies.

Which of the following represents a correct statement regarding internal control testing?

Which of the following best describes the test data approach?

For financial statement audits,auditors need to understand controls that are relevant to the audit in order to

Once auditors determine that entity level controls are designed and placed in the operation,they

Controls that are applied throughout the accounting period must be tested both at an interim date and then again on the balance sheet date.

Which of the following may represent the biggest challenge smaller public companies and nonpublic companies face in implementing effective internal control?

When the auditor attempts to understand the operation of the accounting system by tracing a few transactions through the accounting system,the auditor is said to be

In some cases,management can correct deficiencies and material weaknesses before the auditor does significant testing,which may permit a reduction in control risk.