Homework Answers
C
CONFIRMATION OF CASH BALANCES
THE ABOVE IS NOT AN EVIDENCE OF INTERNAL CONTROL AS CONFIRMATION IS NOT SUPPORTED BY ANY DOCUMENT. IT IS NOT A CONTROL CHECK. IT IS A PERIODIC ACTIVITY.
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Which of the following is not evidence of internal control? 19. records documenting access to computer programs inv...
1. The programmed verification of a customer number is a ____ control. a. preventive b....
1. The programmed verification of a customer number is a ____ control. a. preventive b. detective c. corrective d. application 2. In general, material irregularities perpetrated by which of the following are most difficult to detect? a. cashier b. key-punch operator c. internal auditor d. controller 3. Which of the following is least likely to be evidence the auditor examines to determine whether operations are in compliance with the internal control systems? a. records documenting usage of EDP programs...
19) Which of the following illustrates the internal control procedure-separation of duties? A) External auditors will...
19) Which of the following illustrates the internal control procedure-separation of duties? A) External auditors will monitor internal controls. B) Electronic devices must be installed to reduce theft. C) Cashiers must not have access to accounting records. D) The invoices and other documents must be pre-numbered.
Requirement a. For each control, identify which element of the five categories of control activities is...
Requirement a. For each control, identify which element of the five categories of control activities is applicable (separation of duties, proper authorization, adequate documents or records, physical control over assets and records, or independent checks on performance). Internal Controls Control Activity 1. Approved purchase orders are required for all acquisitions of goods. Prenumbered receiving reports are prepared as support for acquisitions and 2. numerically accounted for. Dates on receiving reports are compared with vendors' invoices before entry 3. into the...
20) In a good internal control system, which of the following sets of documents is required...
20) In a good internal control system, which of the following sets of documents is required for proper approval of a payment to a supplier? A) a receiving report, an invoice, and a purchase order B) a journal entry, a supplier invoice, and a description of the goods being purchased C) a purchase order, a journal entry, and a price catalog D) a supplier invoice, a bill of lading, and the supplier's financial statements
MULTIPLE CHOICE QUESTIONS! 1)In obtaining an understanding of an entity's internal control relevant to audit planning,...
MULTIPLE CHOICE QUESTIONS! 1)In obtaining an understanding of an entity's internal control relevant to audit planning, an auditor is required to obtain knowledge about the a) Controls related to each principal transaction class and account balance. b) Consistency with which controls are currently being applied. c) Effectiveness of controls that have been implemented. d) Design of the controls pertaining to internal control components. 2) In a good system of segregation of duties, which of the following duties should be segregated?...
Internal Control Procedures 1.) Identify and explain the potential internal control weaknesses for each of the...
Internal Control Procedures 1.) Identify and explain the potential internal control weaknesses for each of the following situations. Consider each situation separately. 2.) Suggest and explain a potential internal control for each identified internal control weakness. a) While reviewing the records of Discount Pharmacy, you find that the same employee orders merchandise and approves invoices for payment. b) After the physical count, the storeroom supervisor matches quantities counted against a predetermined reorder level. If the count for a given part...
The following cases describe internal control structures for companies. (a) When Sharon Leung, purchasing agent for...
The following cases describe internal control structures for companies. (a) When Sharon Leung, purchasing agent for Charlie Cosmetics Ltd., orders materials, she sends a duplicate copy of the purchase order to the receiving department. When materials are received, Joe Chang, receiving clerk, records the date of receipt on the copy of the purchase order but does not count the goods received. The same copy of the purchase order is sent to accounting, where Lisa Ho uses it to support the...
Risk analysis and internal control
Review the following description of the purchasing and AP procedures for a company and answer the questions at the end.The purchasing agent receives an inventory status report on his computer terminal from the inventory control application, which identifies the items that need to be reordered. The agent selects the suppliers and enters this information into the computer terminal to create a digital purchase order. He then prints and sends a copy of the PO to the supplier.When the goods are...
Requirement c. For each control, identify an audit procedure that could be used to test the...
Requirement c. For each control, identify an audit procedure that could be used to test the control for effectiveness. (Audit procedures may be used more than once.) (Click the icon to view the audit procedures to test controls.) 1 Test of Control Internal Controls Test of Control 1. Approved purchase orders are required for all acquisitions of goods. Prenumbered receiving reports are prepared as support for acquisitions and 2. numerically accounted for. Dates on receiving reports are compared with vendors'...
Which of the following is an internal control for checks received through the mail? Multiple Choice...
Which of the following is an internal control for checks received through the mail? Multiple Choice ) The accounting department counts the cash, prepares the deposit slip and deposits the cash in the bank. O The mai es gives che The mail clerk gives checks to the person who makes the bank deposit. The accounting department register with the cash count sheet. The Cashier prepares a journal quantity sold, and cash received. Comparing the cash in the register with the...
19) Which of the following illustrates the internal control procedure-separation of duties? A) External auditors will monitor internal controls. B) Electronic devices must be installed to reduce theft. C) Cashiers must not have access to accounting records. D) The invoices and other documents must be pre-numbered.
Requirement a. For each control, identify which element of the five categories of control activities is applicable (separation of duties, proper authorization, adequate documents or records, physical control over assets and records, or independent checks on performance). Internal Controls Control Activity 1. Approved purchase orders are required for all acquisitions of goods. Prenumbered receiving reports are prepared as support for acquisitions and 2. numerically accounted for. Dates on receiving reports are compared with vendors' invoices before entry 3. into the...
20) In a good internal control system, which of the following sets of documents is required for proper approval of a payment to a supplier? A) a receiving report, an invoice, and a purchase order B) a journal entry, a supplier invoice, and a description of the goods being purchased C) a purchase order, a journal entry, and a price catalog D) a supplier invoice, a bill of lading, and the supplier's financial statements
The following cases describe internal control structures for companies. (a) When Sharon Leung, purchasing agent for Charlie Cosmetics Ltd., orders materials, she sends a duplicate copy of the purchase order to the receiving department. When materials are received, Joe Chang, receiving clerk, records the date of receipt on the copy of the purchase order but does not count the goods received. The same copy of the purchase order is sent to accounting, where Lisa Ho uses it to support the...
Requirement c. For each control, identify an audit procedure that could be used to test the control for effectiveness. (Audit procedures may be used more than once.) (Click the icon to view the audit procedures to test controls.) 1 Test of Control Internal Controls Test of Control 1. Approved purchase orders are required for all acquisitions of goods. Prenumbered receiving reports are prepared as support for acquisitions and 2. numerically accounted for. Dates on receiving reports are compared with vendors'...
Which of the following is an internal control for checks received through the mail? Multiple Choice ) The accounting department counts the cash, prepares the deposit slip and deposits the cash in the bank. O The mai es gives che The mail clerk gives checks to the person who makes the bank deposit. The accounting department register with the cash count sheet. The Cashier prepares a journal quantity sold, and cash received. Comparing the cash in the register with the...
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