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CSU ACT 205 Exam 2 Questions and Correct Answers $11.49   Add to cart

Exam (elaborations)

CSU ACT 205 Exam 2 Questions and Correct Answers

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  • CSU ACT 205
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  • CSU ACT 205

CSU ACT 205 Exam 2 Questions and Correct Answers Reasons for incorrect financial statements - ANSWER errors fraud Occupational fraud - ANSWER the use of one's occupation for personal enrichment through the deliberate misuse or misapplication of the employer's resources. ...

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  • July 10, 2023
  • 10
  • 2022/2023
  • Exam (elaborations)
  • Questions & answers
  • CSU ACT 205
  • CSU ACT 205
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Perfectscorer
CSU ACT 205 Exam 2 Questions and Correct Answers Reasons for incorrect financial statements - ANSWER errors fraud Occupational fraud - ANSWER the use of one's occupation for personal enrichment through the deliberate misuse or misapplication of the employer's resources. -2 parts: misuse of resources and financial statement manipulation Fraud triangle - ANSWER three elements present i n fraudulent activity= opportunity, financial pressure, rationalization Internal controls - ANSWER a company's formal procedures to: -safeguard assets from robbery, employee theft, and misuse of company resources -improve accuracy and reliabili ty of accounting information by detecting accidental errors and financial statement manipulation Enron - ANSWER avoided reporting billions in debt/losses WorldCom - ANSWER misclassified expenditures to overstate assets and profitabi lity Sarbanes -Oxley Act of 2002 - ANSWER -passed by congress in 2002 to reduce unethical corporate behavior -companies must: >maintain adequate system of internal controls >continually verify controls are working >certify accuracy of financial information -independent auditors must attest to level of controls -created the PCAOB established guidelines related to internal control procedures and auditor -client relations -applies to all companies involved w/ SEC Major provisions of SOX - ANSWER Oversight board corporate executive accountability nonaudit services retention of work papers auditor rotation conflicts of interest hiring of auditor internal control (section 404) Components of internal co ntrol - ANSWER Control environment, risk assessment, control activities, monitoring Control activities - ANSWER preventive controls and detective controls Preventive controls - ANSWER -separation of duties -proper authori zation -physical controls -employee management -e-commerce controls Separation of duties - ANSWER related duties assigned to different individuals, segregate record -keeping from physical custody Proper authorization - ANSWER formal guidelines for cash receipts and purchases Physical controls - ANSWER safes, fireproof files, locks, security cameras, building access Employee management - ANSWER job knowledge, procedures, ethical responsibilities, reporting irreg ularities E-commerce controls - ANSWER firewalls, passwords, anti -virus software Detective controls - ANSWER -performance reviews -reconciliation -audits Performance reviews - ANSWER actual vs expected and year to year comparisons for results and processes

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