Exam 7: Internal Control

A situation in which the design or operation of a control does not allow management or employees,in the normal course of performing their assigned functions,to prevent or detect material misstatements on a timely basis is referred to as a:

Which of the following matters would an auditor most likely consider to be a significant deficiency to be communicated to the audit committee?

This organization developed a set of criteria that provide management with a basis to evaluate controls not only over financial reporting,but also over the effectiveness and efficiency of operations and compliance with laws and regulations:

Which of the following is intended to detect deviations from prescribed controls?

In assessing the competence of a client's internal auditor,an independent auditor most likely would consider the

After considering the client's internal control the auditors have concluded that it is well designed and is functioning as anticipated.Under these circumstances the auditors would most likely:

The auditors' communication of internal control significant deficiencies should be addressed only to senior management of the company.

Which of the following is most likely to be considered a risk assessment procedure relating to internal control?

When a client uses a service organization to process certain transactions (e.g.,its employee benefit plan),the auditor is least likely to obtain an understanding relating to these transactions by

To provide for the greatest degree of independence in performing internal auditing functions,an internal auditor most likely should report to the:

Proper segregation of duties reduces the opportunities to allow any employee to be in a position to both

Which of the following comes closest to outlining the auditors' responsibility for considering internal control in all financial statement audits?

After obtaining an understanding of internal control and arriving at a preliminary assessed level of control risk,an auditor decided to perform tests of controls.The auditor most likely decided that:

When performing an internal control audit under PCAOB standards,one or more material weaknesses in internal control that exist at year-end may result in what type of report(s): Qualified Disclaimer A) Yes Yes B) Yes No C) No Yes D) No No

Which of the following is not a factor that is considered a part of the client's overall control environment?

When considering a client's internal control,the auditors focus on its various characteristics.For each of the following characteristics indicate the auditors' responsibility under generally accepted auditing standards and the procedures used to meet that responsibility. a.The design of internal control. b.Controls have been implemented (placed in operation). c.The operating effectiveness of controls.

Which of the following is correct with respect to control deficiencies discovered during an audit?

Which of the following is not considered one of the five major components of internal control?

Tests of controls do not ordinarily address:

A service auditor's report on a service center should include a(n)