Question 1

Which of the following suggests a weakness in a company's internal environment?

Accepted Answer

A)  The audit committee regularly meets with the external auditors. 
B)  The Board of Directors is primarily independent directors. 
C)  The company has an up-to-date organizational chart. 
D)  Formal employee performance evaluations are prepared every three years. 
A)  The audit committee regularly meets with the external auditors. 
B)  The Board of Directors is primarily independent directors. 
C)  The company has an up-to-date organizational chart. 
D)  Formal employee performance evaluations are prepared every three years.

Question 2

Which of the following is a control related to design and use of documents and records?

Accepted Answer

A)  Sequentially prenumbering sales invoices 
B)  Comparing physical inventory counts with perpetual inventory records 
C)  Reconciling the bank statement to the general ledger 
D)  Locking blank checks in a drawer or safe 
A)  Sequentially prenumbering sales invoices 
B)  Comparing physical inventory counts with perpetual inventory records 
C)  Reconciling the bank statement to the general ledger 
D)  Locking blank checks in a drawer or safe

Question 3

The definition of the lines of authority and responsibility and the overall framework for planning,directing,and controlling is laid out by the

Accepted Answer

A)  control activities 
B)  organizational structure 
C)  budget framework 
D)  internal environment 
A)  control activities 
B)  organizational structure 
C)  budget framework 
D)  internal environment

Question 4

Explain how a company could be the victim of fraud,even if ideal segregation of duties is enforced.

Accepted Answer

When a system effectively incorporates a

Question 5

According to The Sarbanes-Oxley Act of 2002,the audit committee of the board of directors is directly responsible for

Accepted Answer

A)  hiring and firing the external auditors. 
B)  performing tests of the company's internal control structure. 
C)  certifying the accuracy of the company's financial reporting process. 
D)  overseeing day-to-day operations of the internal audit department. 
A)  hiring and firing the external auditors. 
B)  performing tests of the company's internal control structure. 
C)  certifying the accuracy of the company's financial reporting process. 
D)  overseeing day-to-day operations of the internal audit department.

Question 6

According to the ERM,these deal with the effectiveness and efficiency of company operations,such as performance and profitability goals.

Accepted Answer

A)  Compliance objectives 
B)  Operations objectives 
C)  Reporting objectives 
D)  Strategic objectives 
A)  Compliance objectives 
B)  Operations objectives 
C)  Reporting objectives 
D)  Strategic objectives

Question 7

The COSO Enterprise Risk Management Integrated Framework stresses that

Accepted Answer

A)  risk management activities are an inherent part of all business operations and should be considered during strategy setting. 
B)  effective risk management is comprised of just three interrelated components; internal environment, risk assessment, and control activities. 
C)  risk management is the sole responsibility of top management. 
D)  risk management policies, if enforced, guarantee achievement of corporate objectives. 
A)  risk management activities are an inherent part of all business operations and should be considered during strategy setting. 
B)  effective risk management is comprised of just three interrelated components; internal environment, risk assessment, and control activities. 
C)  risk management is the sole responsibility of top management. 
D)  risk management policies, if enforced, guarantee achievement of corporate objectives.

Question 8

Independent checks on performance include all the following except

Accepted Answer

A)  data input validation checks. 
B)  reconciling hash totals. 
C)  preparing a trial balance report. 
D)  supervisor review of journal entries and supporting documentation. 
A)  data input validation checks. 
B)  reconciling hash totals. 
C)  preparing a trial balance report. 
D)  supervisor review of journal entries and supporting documentation.

Question 9

Which of the following is accomplished by corrective controls?

Accepted Answer

A)  Identify the cause of the problem. 
B)  Correct the resulting errors. 
C)  Modify the system to prevent future occurrences of the problem. 
D)  All of the above are accomplished by corrective controls. 
A)  Identify the cause of the problem. 
B)  Correct the resulting errors. 
C)  Modify the system to prevent future occurrences of the problem. 
D)  All of the above are accomplished by corrective controls.

Question 10

Petty cash is disbursed by the Fred Haynes in the Cashier's Office.He also maintains records of disbursements,places requests to the Finance Department to replace expended funds,and periodically reconciles the petty cash balance.This represents a(an)________ segregation of duties.

Accepted Answer

A)  effective 
B)  ideal 
C)  ineffective 
D)  limited 
A)  effective 
B)  ideal 
C)  ineffective 
D)  limited

Question 11

Pam is a receptionist for Dunderhead Paper Co.,which has strict corporate policies on appropriate use of corporate resources.The first week of August,Pam saw Michael,the branch manager,putting pencils,pens,erasers,paper and other supplies into his briefcase on his way out the door.This situation best reflects a weakness in which aspect of internal environment,as discussed in the COSO Enterprise Risk Management Framework?

Accepted Answer

A)  Integrity and ethical values 
B)  Risk management philosophy 
C)  Restrict access to assets 
D)  Methods of assigning authority and responsibility 
A)  Integrity and ethical values 
B)  Risk management philosophy 
C)  Restrict access to assets 
D)  Methods of assigning authority and responsibility

Question 12

A(n)________ measures company progress by comparing actual performance to planned performance.

Accepted Answer

A)  boundary system 
B)  diagnostic control system 
C)  interactive control system 
D)  internal control system 
A)  boundary system 
B)  diagnostic control system 
C)  interactive control system 
D)  internal control system

Question 13

The Sarbanes-Oxley Act (SOX)applies to

Accepted Answer

A)  all companies with gross annual revenues exceeding $500 million. 
B)  publicly held companies with gross annual revenues exceeding $500 million. 
C)  all private and publicly held companies incorporated in the United States. 
D)  all publicly held companies. 
A)  all companies with gross annual revenues exceeding $500 million. 
B)  publicly held companies with gross annual revenues exceeding $500 million. 
C)  all private and publicly held companies incorporated in the United States. 
D)  all publicly held companies.

Question 14

Safeguarding assets is one of the control objectives of internal control.Which of the following is not one of the other control objectives?

Accepted Answer

A)  providing accurate and reliable information 
B)  promoting operational efficiency 
C)  ensuring that no fraud has occurred 
D)  encouraging adherence to management policies 
A)  providing accurate and reliable information 
B)  promoting operational efficiency 
C)  ensuring that no fraud has occurred 
D)  encouraging adherence to management policies

Question 15

The audit committee is responsible for

Accepted Answer

A)  overseeing the internal control structure. 
B)  overseeing the financial reporting process. 
C)  working with the internal and external auditors. 
D)  All of the above are responsibilities. 
A)  overseeing the internal control structure. 
B)  overseeing the financial reporting process. 
C)  working with the internal and external auditors. 
D)  All of the above are responsibilities.

Question 16

Which of the following is not a risk reduction element of a disaster recovery plan?

Accepted Answer

A)  Identification of alternate work site 
B)  Off-site storage of backup files and programs 
C)  Documentation of procedures and responsibilitie 
D)  Adequate casualty insurance 
A)  Identification of alternate work site 
B)  Off-site storage of backup files and programs 
C)  Documentation of procedures and responsibilitie 
D)  Adequate casualty insurance

Question 17

FranticHouse Partners,L.L.C.,does home remodeling and repair.All employees are bonded,so the firm's risk exposure to employee fraud is

Accepted Answer

A)  reduced. 
B)  shared. 
C)  avoided. 
D)  accepted. 
A)  reduced. 
B)  shared. 
C)  avoided. 
D)  accepted.

Question 18

One reason why many organizations do not adequately protect their systems is because

Accepted Answer

A)  control problems may be overestimated by many companies. 
B)  productivity and cost cutting cause management to forgo implementing and maintaining internal controls. 
C)  control technology has not yet been developed. 
D)  all of the above 
A)  control problems may be overestimated by many companies. 
B)  productivity and cost cutting cause management to forgo implementing and maintaining internal controls. 
C)  control technology has not yet been developed. 
D)  all of the above

Question 19

Which of the following is not one of the eight interrelated risk and control components of COSO Enterprise Risk Management Framework?

Accepted Answer

A)  Internal environment 
B)  Monitoring 
C)  Risk response 
D)  Event assessment 
A)  Internal environment 
B)  Monitoring 
C)  Risk response 
D)  Event assessment

Question 20

At a movie theater box office,all tickets are sequentially prenumbered.At the end of each day,the beginning ticket number is subtracted from the ending number to calculate the number of tickets sold.Then,ticket stubs collected at the theater entrance are counted and compared with the number of tickets sold.Which of the following situations does this control detect?

Accepted Answer

A)  Some customers presented tickets purchased on a previous day when there wasn't a ticket taker at the theater entrance (so the tickets didn't get torn.) 
B)  A group of kids snuck into the theater through a back door when customers left after a show. 
C)  The box office cashier accidentally gives too much change to a customer. 
D)  The ticket taker admits his friends without tickets. 
A)  Some customers presented tickets purchased on a previous day when there wasn't a ticket taker at the theater entrance (so the tickets didn't get torn.) 
B)  A group of kids snuck into the theater through a back door when customers left after a show. 
C)  The box office cashier accidentally gives too much change to a customer. 
D)  The ticket taker admits his friends without tickets.

Which of the following suggests a weakness in a company's internal environment?

Which of the following is a control related to design and use of documents and records?

The definition of the lines of authority and responsibility and the overall framework for planning,directing,and controlling is laid out by the

Explain how a company could be the victim of fraud,even if ideal segregation of duties is enforced.

According to The Sarbanes-Oxley Act of 2002,the audit committee of the board of directors is directly responsible for

According to the ERM,these deal with the effectiveness and efficiency of company operations,such as performance and profitability goals.

The COSO Enterprise Risk Management Integrated Framework stresses that

Independent checks on performance include all the following except

Which of the following is accomplished by corrective controls?

Petty cash is disbursed by the Fred Haynes in the Cashier's Office.He also maintains records of disbursements,places requests to the Finance Department to replace expended funds,and periodically reconciles the petty cash balance.This represents a(an)________ segregation of duties.

A(n)________ measures company progress by comparing actual performance to planned performance.

The Sarbanes-Oxley Act (SOX)applies to

Safeguarding assets is one of the control objectives of internal control.Which of the following is not one of the other control objectives?

The audit committee is responsible for

Which of the following is not a risk reduction element of a disaster recovery plan?

FranticHouse Partners,L.L.C.,does home remodeling and repair.All employees are bonded,so the firm's risk exposure to employee fraud is

One reason why many organizations do not adequately protect their systems is because

Which of the following is not one of the eight interrelated risk and control components of COSO Enterprise Risk Management Framework?

Accounting Information Systems: an Overview

Overview of Transaction Processing and Erp Systems

Systems Documentation Techniques

Relational Databases

Computer Fraud

Computer Fraud and Abuse Techniques

Information Systems Controls for System Reliability Part 1: Information Security

Information Systems Controls for Systems Reliability Part 2: Confidentiality and Privacy

Information Systems Controls for Systems Reliability Part 3: Processing Integrity and Availability

Auditing Computer-Based Information Systems

The Revenue Cycle: Sales to Cash Collections

The Expenditure Cycle: Purchasing to Cash Disbursements

The Production Cycle

The Human Resources Management and Payroll Cycle

General Ledger and Reporting System

The Rea Data Model

Implementing an Rea Model in a Relational Database

Special Topics in Rea Modeling

Introduction to Systems Development Systems Analysis

Ais Development Strategies

Systems Design, implementation, and Operation

Filters

Exam 7: Control and Accounting Information Systems

Which of the following suggests a weakness in a company's internal environment?

Which of the following is a control related to design and use of documents and records?

The definition of the lines of authority and responsibility and the overall framework for planning,directing,and controlling is laid out by the

Explain how a company could be the victim of fraud,even if ideal segregation of duties is enforced.

According to The Sarbanes-Oxley Act of 2002,the audit committee of the board of directors is directly responsible for

According to the ERM,these deal with the effectiveness and efficiency of company operations,such as performance and profitability goals.

The COSO Enterprise Risk Management Integrated Framework stresses that

Independent checks on performance include all the following except

Which of the following is accomplished by corrective controls?

Petty cash is disbursed by the Fred Haynes in the Cashier's Office.He also maintains records of disbursements,places requests to the Finance Department to replace expended funds,and periodically reconciles the petty cash balance.This represents a(an)________ segregation of duties.

A(n)________ measures company progress by comparing actual performance to planned performance.

The Sarbanes-Oxley Act (SOX)applies to

Safeguarding assets is one of the control objectives of internal control.Which of the following is not one of the other control objectives?

The audit committee is responsible for

Which of the following is not a risk reduction element of a disaster recovery plan?

FranticHouse Partners,L.L.C.,does home remodeling and repair.All employees are bonded,so the firm's risk exposure to employee fraud is

One reason why many organizations do not adequately protect their systems is because

Which of the following is not one of the eight interrelated risk and control components of COSO Enterprise Risk Management Framework?

Accounting Information Systems: an Overview

Overview of Transaction Processing and Erp Systems

Systems Documentation Techniques

Relational Databases

Computer Fraud

Computer Fraud and Abuse Techniques

Information Systems Controls for System Reliability Part 1: Information Security

Information Systems Controls for Systems Reliability Part 2: Confidentiality and Privacy

Information Systems Controls for Systems Reliability Part 3: Processing Integrity and Availability

Auditing Computer-Based Information Systems

The Revenue Cycle: Sales to Cash Collections

The Expenditure Cycle: Purchasing to Cash Disbursements

The Production Cycle

The Human Resources Management and Payroll Cycle

General Ledger and Reporting System

The Rea Data Model

Implementing an Rea Model in a Relational Database

Special Topics in Rea Modeling

Introduction to Systems Development Systems Analysis

Ais Development Strategies

Systems Design, implementation, and Operation

Filters