Exam 10: Fraud and Internal Control

In a HotSpot DFD, which color indicates the least risk?

The ________ of internal auditors establishes trust and thus provides the basis for reliance on their judgment.

Accounting professionals often refer to the fraud triangle as incentive/opportunity/rationalization.

What three things must a perpetrator have to commit fraud? Include a brief description of each.

List the three fraud and abuse categories. Provide examples.

Which Rule of Conduct for internal auditors states that they are to disclose all material facts known to them that, if not disclosed, may distort the reporting of activities under review?

What are the objectives of internal control?

Which principle in the Code of Ethics for internal auditors states that the are to make a balanced assessment of all the relevant circumstances and are not unduly influenced by their own interests or by others in forming judgments?

In control activities, ________ ensure appropriate information processing, authorization, and data integrity.

________ controls include IT governance at top management levels where strategic business objectives are set and policies are established.

The typical fraud lasts three years before it is detected.

List and describe the control activities for mitigating financial, operational, and compliance controls risks.

A(n)________ over financial reporting requires the auditor to conduct tests of controls to obtain evidence that internal control over financial reporting has operated effectively.

You are a manager for a large public accounting firm and have been assigned to conduct an internal audit for a publicly traded company. You your parents have 75% of their retirement savings in the client company stock. Prepare an email requesting another assignment. Explain your reasons.

You are an internal auditor for a company with a policy stating all software on company computers must be approved and installed by the IT department. During the course of an IT audit you discover has installed MP3s on their company computer. What do you do?

Match the DFD symbol to the name. A)Agent B)Dataflow C)Datastore D)Process -

What percentage of occupational fraud is committed by the accounting department?

Earnings management focuses on managing when revenues and expenses are recorded in order to favorably reflect a company's financial performance in a(n)________.

Increasingly, the PCAOB is expecting auditors to understand how IT affects the audit and integrating IT into the audit.

Match the internal auditors code of ethics principle to the appropriate definition. A)Internal auditors respect the value and ownership of information they receive and do not disclose information without appropriate authority unless there is a legal or professional obligation to do so. B)Internal auditors apply the knowledge, skills, and experience needed in the performance of internal audit services. C)The integrity of internal auditors establishes trust and thus provides the basis for reliance on their judgment. D)Internal auditors exhibit the highest level of professional objectivity in gathering, evaluating, and communicating information about the activity or process being examined. -Objectivity