, IT7jAuditing7j4th7jEd—
Test Bank, Chapter 1
Chapter7j1—Auditing7jand7jInternal7jControl
TRUE/FALSE
1. Corporate7jmanagement7j(including7jthe7jCEO)7jmust7jcertify7jmonthly7jand7jannually7jtheir7jorganiza
tion‟s7jinternal7jcontrols7jover7jfinancial7jreporting.
ANS:7 j F PTS:7 j 7 j 1
2. Both7jthe7jSEC7jand7jthe7jPCAOB7jrequire7jmanagement7jto7juse7jthe7jCOBIT7jframework7jfor7jassessing7
jinternal7jcontrol7jadequacy.
ANS:7 j F PTS:7 j 7 j 1
3. Both7jthe7jSEC7jand7jthe7jPCAOB7jrequire7jmanagement7jto7juse7jthe7jCOSO7jframework7jfor7jassessing
7jinternal7jcontrol7jadequacy.
ANS:7 j F PTS:7 j 7 j 1
4. A7jqualified7jopinion7jon7jmanagement‟s7jassessment7jof7jinternal7jcontrols7jover7jthe7jfinancial7jreporting7j
system7jnecessitates7ja7jqualified7jopinion7jon7jthe7jfinancial7jstatements?
ANS:7 j F PTS:7 j 7 j 1
5. The7jsame7jinternal7jcontrol7jobjectives7japply7jto7jmanual7jand7jcomputer-based7jinformation7jsystems.
ANS:7 j T PTS:7 j 7 j 1
6. The7jexternal7jauditor7jis7jresponsible7jfor7jestablishing7jand7jmaintaining7jthe7jinternal7jcontrol7jsystem.
ANS:7 j F PTS:7 j 7 j 1
7. Segregation7jof7jduties7jis7jan7jexample7jof7jan7jinternal7jcontrol7jprocedure.
ANS:7 j T PTS:7 j 7 j 1
8. Preventive7jcontrols7jare7jpassive7jtechniques7jdesigned7jto7jreduce7jfraud.
ANS:7 j T PTS:7 j 7 j 1
9. A7 j key7jmodifying7jassumption7jin7jinternal7jcontrol7jis7jthat7jthe7jinternal7jcontrol7jsystem7jis7jthe7jrespons
ibility7jof7jmanagement.
ANS:7 j T PTS:7 j 7 j 1
©7j20167jCengage7jLearning®.7 j May7jnot7jbe7jscanned,7jcopied7jor7jduplicated7jor7jposted7jto7ja7jpublicly7jaccessible7jwebsite,7jin7jwhole7jor7jin7jpart,7jexc
ept7jfor7juse7jas7jpermitted7jin7ja7 j license7jdistributed7jwith7ja7jcertain7jproduct7jor7jservice7jor7jotherwise7jon7ja7jpassword-protected7jwebsite7jor7jschool-
approved7jlearning7jmanagement7jsystem7jfor7jclassroom7juse.
, IT7jAuditing7j4th7jEd—
Test Bank, Chapter 1
10. While7jthe7jSarbanes-Oxley7jAct7jprohibits7jauditors7jfrom7jproviding7jnon-
accounting7jservices7jto7jtheir7jaudit7jclients,7jthey7jare7jnot7jprohibited7jfrom7jperforming7jsuch7jservice
s7jfor7jnon-audit7jclients7jor7jprivately7jheld7jcompanies.
ANS:7 j T PTS:7 j 7 j 1
11. The7jSarbanes-Oxley7jAct7jrequires7jthe7jaudit7jcommittee7jto7jhire7jand7joversee7jthe7jexternal7jauditors.
ANS:7 j T PTS:7 j 7 j 1
12. Section7j4047jrequires7jthat7jcorporate7jmanagement7j(including7jthe7jCEO)7jcertify7jtheir7jorganization‟s7ji
nternal7jcontrols7jon7ja7jquarterly7jand7jannual7jbasis.
ANS:7 j F PTS:7 j 7 j 1
13. Section7j3027jrequires7jthe7jmanagement7jof7jpublic7jcompanies7jto7jassess7jand7jformally7jreport
7jon7jthe7jeffectiveness7jof7jtheir7jorganization‟s7jinternal7jcontrols.
ANS:7 j F PTS:7 j 7 j 1
14. Application7jcontrols7japply7jto7ja7jwide7jrange7jof7jexposures7jthat7jthreaten7jthe7jintegrity7jof7jall7jp
rograms7jprocessed7jwithin7jthe7jcomputer7jenvironment.
ANS:7 j F PTS:7 j 7 j 1
15. Advisory7jservices7jis7jan7jemerging7jfield7jthat7jgoes7jbeyond7jthe7jauditor‟s7jtraditional7jattestation7jfunction.
ANS:7 j T PTS:7 j 7 j 1
16. An7jIT7jauditor7jexpresses7jan7jopinion7jon7jthe7jfairness7jof7jthe7jfinancial7jstatements.
ANS:7 j F PTS:7 j 7 j 1
17. External7jauditing7jis7jan7jindependent7jappraisal7jfunction7jestablished7jwithin7jan7jorganization7jto7jexami
ne7jand7jevaluate7jits7jactivities7jas7ja7jservice7jto7jthe7jorganization.
ANS:7 j F PTS:7 j 7 j 1
18. External7jauditors7jcan7jcooperate7jwith7jand7juse7jevidence7jgathered7jby7jinternal7jaudit7jdepartments7j
that7jare7jorganizationally7jindependent7jand7jthat7jreport7jto7jthe7jAudit7jCommittee7jof7jthe7jBoard7jof
©7j20167jCengage7jLearning®.7 j May7jnot7jbe7jscanned,7jcopied7jor7jduplicated7jor7jposted7jto7ja7jpublicly7jaccessible7jwebsite,7jin7jwhole7jor7jin7jpart,7jexc
ept7jfor7juse7jas7jpermitted7jin7ja7 j license7jdistributed7jwith7ja7jcertain7jproduct7jor7jservice7jor7jotherwise7jon7ja7jpassword-protected7jwebsite7jor7jschool-
approved7jlearning7jmanagement7jsystem7jfor7jclassroom7juse.
, IT7jAuditing7j4th7jEd—
7jDirectors. Test Bank, Chapter 1
©7j20167jCengage7jLearning®.7 j May7jnot7jbe7jscanned,7jcopied7jor7jduplicated7jor7jposted7jto7ja7jpublicly7jaccessible7jwebsite,7jin7jwhole7jor7jin7jpart,7jexc
ept7jfor7juse7jas7jpermitted7jin7ja7 j license7jdistributed7jwith7ja7jcertain7jproduct7jor7jservice7jor7jotherwise7jon7ja7jpassword-protected7jwebsite7jor7jschool-
approved7jlearning7jmanagement7jsystem7jfor7jclassroom7juse.
Test Bank, Chapter 1
Chapter7j1—Auditing7jand7jInternal7jControl
TRUE/FALSE
1. Corporate7jmanagement7j(including7jthe7jCEO)7jmust7jcertify7jmonthly7jand7jannually7jtheir7jorganiza
tion‟s7jinternal7jcontrols7jover7jfinancial7jreporting.
ANS:7 j F PTS:7 j 7 j 1
2. Both7jthe7jSEC7jand7jthe7jPCAOB7jrequire7jmanagement7jto7juse7jthe7jCOBIT7jframework7jfor7jassessing7
jinternal7jcontrol7jadequacy.
ANS:7 j F PTS:7 j 7 j 1
3. Both7jthe7jSEC7jand7jthe7jPCAOB7jrequire7jmanagement7jto7juse7jthe7jCOSO7jframework7jfor7jassessing
7jinternal7jcontrol7jadequacy.
ANS:7 j F PTS:7 j 7 j 1
4. A7jqualified7jopinion7jon7jmanagement‟s7jassessment7jof7jinternal7jcontrols7jover7jthe7jfinancial7jreporting7j
system7jnecessitates7ja7jqualified7jopinion7jon7jthe7jfinancial7jstatements?
ANS:7 j F PTS:7 j 7 j 1
5. The7jsame7jinternal7jcontrol7jobjectives7japply7jto7jmanual7jand7jcomputer-based7jinformation7jsystems.
ANS:7 j T PTS:7 j 7 j 1
6. The7jexternal7jauditor7jis7jresponsible7jfor7jestablishing7jand7jmaintaining7jthe7jinternal7jcontrol7jsystem.
ANS:7 j F PTS:7 j 7 j 1
7. Segregation7jof7jduties7jis7jan7jexample7jof7jan7jinternal7jcontrol7jprocedure.
ANS:7 j T PTS:7 j 7 j 1
8. Preventive7jcontrols7jare7jpassive7jtechniques7jdesigned7jto7jreduce7jfraud.
ANS:7 j T PTS:7 j 7 j 1
9. A7 j key7jmodifying7jassumption7jin7jinternal7jcontrol7jis7jthat7jthe7jinternal7jcontrol7jsystem7jis7jthe7jrespons
ibility7jof7jmanagement.
ANS:7 j T PTS:7 j 7 j 1
©7j20167jCengage7jLearning®.7 j May7jnot7jbe7jscanned,7jcopied7jor7jduplicated7jor7jposted7jto7ja7jpublicly7jaccessible7jwebsite,7jin7jwhole7jor7jin7jpart,7jexc
ept7jfor7juse7jas7jpermitted7jin7ja7 j license7jdistributed7jwith7ja7jcertain7jproduct7jor7jservice7jor7jotherwise7jon7ja7jpassword-protected7jwebsite7jor7jschool-
approved7jlearning7jmanagement7jsystem7jfor7jclassroom7juse.
, IT7jAuditing7j4th7jEd—
Test Bank, Chapter 1
10. While7jthe7jSarbanes-Oxley7jAct7jprohibits7jauditors7jfrom7jproviding7jnon-
accounting7jservices7jto7jtheir7jaudit7jclients,7jthey7jare7jnot7jprohibited7jfrom7jperforming7jsuch7jservice
s7jfor7jnon-audit7jclients7jor7jprivately7jheld7jcompanies.
ANS:7 j T PTS:7 j 7 j 1
11. The7jSarbanes-Oxley7jAct7jrequires7jthe7jaudit7jcommittee7jto7jhire7jand7joversee7jthe7jexternal7jauditors.
ANS:7 j T PTS:7 j 7 j 1
12. Section7j4047jrequires7jthat7jcorporate7jmanagement7j(including7jthe7jCEO)7jcertify7jtheir7jorganization‟s7ji
nternal7jcontrols7jon7ja7jquarterly7jand7jannual7jbasis.
ANS:7 j F PTS:7 j 7 j 1
13. Section7j3027jrequires7jthe7jmanagement7jof7jpublic7jcompanies7jto7jassess7jand7jformally7jreport
7jon7jthe7jeffectiveness7jof7jtheir7jorganization‟s7jinternal7jcontrols.
ANS:7 j F PTS:7 j 7 j 1
14. Application7jcontrols7japply7jto7ja7jwide7jrange7jof7jexposures7jthat7jthreaten7jthe7jintegrity7jof7jall7jp
rograms7jprocessed7jwithin7jthe7jcomputer7jenvironment.
ANS:7 j F PTS:7 j 7 j 1
15. Advisory7jservices7jis7jan7jemerging7jfield7jthat7jgoes7jbeyond7jthe7jauditor‟s7jtraditional7jattestation7jfunction.
ANS:7 j T PTS:7 j 7 j 1
16. An7jIT7jauditor7jexpresses7jan7jopinion7jon7jthe7jfairness7jof7jthe7jfinancial7jstatements.
ANS:7 j F PTS:7 j 7 j 1
17. External7jauditing7jis7jan7jindependent7jappraisal7jfunction7jestablished7jwithin7jan7jorganization7jto7jexami
ne7jand7jevaluate7jits7jactivities7jas7ja7jservice7jto7jthe7jorganization.
ANS:7 j F PTS:7 j 7 j 1
18. External7jauditors7jcan7jcooperate7jwith7jand7juse7jevidence7jgathered7jby7jinternal7jaudit7jdepartments7j
that7jare7jorganizationally7jindependent7jand7jthat7jreport7jto7jthe7jAudit7jCommittee7jof7jthe7jBoard7jof
©7j20167jCengage7jLearning®.7 j May7jnot7jbe7jscanned,7jcopied7jor7jduplicated7jor7jposted7jto7ja7jpublicly7jaccessible7jwebsite,7jin7jwhole7jor7jin7jpart,7jexc
ept7jfor7juse7jas7jpermitted7jin7ja7 j license7jdistributed7jwith7ja7jcertain7jproduct7jor7jservice7jor7jotherwise7jon7ja7jpassword-protected7jwebsite7jor7jschool-
approved7jlearning7jmanagement7jsystem7jfor7jclassroom7juse.
, IT7jAuditing7j4th7jEd—
7jDirectors. Test Bank, Chapter 1
©7j20167jCengage7jLearning®.7 j May7jnot7jbe7jscanned,7jcopied7jor7jduplicated7jor7jposted7jto7ja7jpublicly7jaccessible7jwebsite,7jin7jwhole7jor7jin7jpart,7jexc
ept7jfor7juse7jas7jpermitted7jin7ja7 j license7jdistributed7jwith7ja7jcertain7jproduct7jor7jservice7jor7jotherwise7jon7ja7jpassword-protected7jwebsite7jor7jschool-
approved7jlearning7jmanagement7jsystem7jfor7jclassroom7juse.
