Accy 201 burney test 3 Ch 6 Test
Questions Fully Solved.
internal control system - Answer policies and procedures used to protect assets, promote
efficient operations, ensure reliable accounting, and uphold company policies
Sarbanes-Oxley Act (SOX) - Answer requires managers and auditors of companies whose
stock is traded on an exchange to document and verify internal controls
committee of sponsoring organization (COSO) - Answer 5 ingredients of internal control that
add to the quality of accounting information
control environment - Answer company structure, ethics, and integrity
risk assessment - Answer identify, analyze, and manage risk factors
control activities - Answer policies and procedures to reduce risk of loss
information and communication - Answer reports to internal and external parties
monitoring - Answer regular review of internal effectiveness
principles of internal control - Answer 1. establish responsibilities
2. maintain adequate records
3. insure assets and bond key employees
4. separate record keeping from custody of assets
5. divide responsibility for related transactions
6. apply technological controls
7. perform regular and independent reviews
limitations of internal control - Answer opportunity, pressure, rationalization
opportunity - Answer internal control weaknesses in a business
pressure - Answer financial, family, and societal stresses to succeed
Questions Fully Solved.
internal control system - Answer policies and procedures used to protect assets, promote
efficient operations, ensure reliable accounting, and uphold company policies
Sarbanes-Oxley Act (SOX) - Answer requires managers and auditors of companies whose
stock is traded on an exchange to document and verify internal controls
committee of sponsoring organization (COSO) - Answer 5 ingredients of internal control that
add to the quality of accounting information
control environment - Answer company structure, ethics, and integrity
risk assessment - Answer identify, analyze, and manage risk factors
control activities - Answer policies and procedures to reduce risk of loss
information and communication - Answer reports to internal and external parties
monitoring - Answer regular review of internal effectiveness
principles of internal control - Answer 1. establish responsibilities
2. maintain adequate records
3. insure assets and bond key employees
4. separate record keeping from custody of assets
5. divide responsibility for related transactions
6. apply technological controls
7. perform regular and independent reviews
limitations of internal control - Answer opportunity, pressure, rationalization
opportunity - Answer internal control weaknesses in a business
pressure - Answer financial, family, and societal stresses to succeed
