Exam 1: Auditing and Internal Control

Use the internal control procedures listed below to complete statements 6 through 12. -Using cameras to monitor the activities of cashiers is an example of __________________________.

Both the SEC and the PCAOB require management to use the COSO framework for assessing internal control adequacy.

The PCAOB's standard No.2 specifically requires auditors to understand transaction flows in designing their test of controls.What steps does this entail?

A key modifying assumption in internal control is that the internal control system is the responsibility of management.

The Sarbanes-Oxley Act requires only that a firm keep good records.

Which of the following is not an element of the internal control environment?

External auditors can cooperate with and use evidence gathered by internal audit departments that are organizationally independent and that report to the Audit Committee of the Board of Directors.

COSO identifies two broad groupings of information system controls.What are they?

How do the tests of controls affect substantive tests?

IT auditing is a small part of most external and internal audits.

Which of the following is a preventive control?

Which of the following situations is not a segregation of duties violation?

Substantive testing techniques provide information about the accuracy and completeness of an application's processes.

Explain the purpose of the PCAOB.

Contrast internal and external auditing.

Preventive controls are passive techniques designed to reduce fraud.

Indicate whether each procedure is a preventive or detective control.

Control activities under SAS 109/COSO include

Both the SEC and the PCAOB have expressed an opinion as which internal control framework an organization should use to comply with SOX legislation.Explain.

Which of the following is true?