Question 1

Explain why collusion between employees and management in the commission of a fraud is difficult to both prevent and detect.

Accepted Answer

Collusion among employees in the commiss

Question 2

What are the five internal control components described in the SAS 78 / COSO framework

Accepted Answer

the control environment,risk a

Question 3

Opportunity involves direct access to assets and/or access to information that controls assets.

Accepted Answer

A) True 
 B)False

Question 4

Shredding computer printouts is an example of an output control.

Accepted Answer

A) True 
 B)False

Question 5

A shell company fraud involves

Accepted Answer

A)  stealing cash from an organization before it is recorded 
B)  Stealing cash from an organization after it has been recorded 
C)  manufacturing false purchase orders,receiving reports,and invoices 
D)  A clerk pays a vendor twice for the same products and cashes the reimbursement check issued by the vendor. 
A)  stealing cash from an organization before it is recorded 
B)  Stealing cash from an organization after it has been recorded 
C)  manufacturing false purchase orders,receiving reports,and invoices 
D)  A clerk pays a vendor twice for the same products and cashes the reimbursement check issued by the vendor.

Question 6

Which statement is not correct? The audit trail in a computerized environment

Accepted Answer

A)  consists of records that are stored sequentially in an audit file 
B)  traces transactions from their source to their final disposition 
C)  is a function of the quality and integrity of the application programs 
D)  may take the form of pointers,indexes,and embedded keys 
A)  consists of records that are stored sequentially in an audit file 
B)  traces transactions from their source to their final disposition 
C)  is a function of the quality and integrity of the application programs 
D)  may take the form of pointers,indexes,and embedded keys

Question 7

Contrast management fraud with employee fraud.

Accepted Answer

Employee fraud is usually designed to di

Question 8

Internal control system have limitations.These include all of the following except

Accepted Answer

A)  possibility of honest error 
B)  circumvention 
C)  management override 
D)  stability of systems 
A)  possibility of honest error 
B)  circumvention 
C)  management override 
D)  stability of systems

Question 9

Which of the following is the best reason to separate duties in a manual system?

Accepted Answer

A)  to avoid collusion between the programmer and the computer operator 
B)  to ensure that supervision is not required 
C)  to prevent the record keeper from authorizing transactions 
D)  to enable the firm to function more efficiently 
A)  to avoid collusion between the programmer and the computer operator 
B)  to ensure that supervision is not required 
C)  to prevent the record keeper from authorizing transactions 
D)  to enable the firm to function more efficiently

Question 10

In this age of high technology and computer based information systems,why are accountants concerned about physical (human)controls?

Accepted Answer

Virtually all systems,regardless of thei

Question 11

Section 302 requires the management of public companies to assess and formally report on the effectiveness of their organization's internal controls.

Accepted Answer

A) True 
 B)False

Question 12

Of the three fraud factors (situational pressure,ethics,and opportunity),situational pressure is the factor that actually facilitates the act.

Accepted Answer

A) True 
 B)False

Question 13

A well-designed purchase order is an example of a

Accepted Answer

A)  preventive control 
B)  detective control 
C)  corrective control 
D)  none of the above 
A)  preventive control 
B)  detective control 
C)  corrective control 
D)  none of the above

Question 14

Control activities under SA 78/COSO include

Accepted Answer

A)  IT Controls,preventative controls,and Corrective controls 
B)  physical controls,preventative controls,and corrective controls. 
C)  general controls,application controls,and physical controls. 
D)  transaction authorizations,segregation of duties,and risk assessment 
A)  IT Controls,preventative controls,and Corrective controls 
B)  physical controls,preventative controls,and corrective controls. 
C)  general controls,application controls,and physical controls. 
D)  transaction authorizations,segregation of duties,and risk assessment

Question 15

List the four broad objectives of the internal control system.

Accepted Answer

safeguard assets, ensure the a

Question 16

Give two examples of employee fraud and explain how the theft might occur.

Accepted Answer

Charges to expense accounts: Cash could

Question 17

How does privacy relate to output control?

Accepted Answer

If the privacy of certain type

Question 18

The correct purchase order number,is123456.All of the following are transcription errors except

Accepted Answer

A)  1234567 
B)  12345 
C)  124356 
D)  123454 
A)  1234567 
B)  12345 
C)  124356 
D)  123454

Question 19

Use the internal control procedures listed below to complete the statements.
 $\begin{array}{ll}
\text { segregation of duties } & \text { specific authorization } \
\text { general authorization } & \text { accounting records } \
\text { access controls } & \text { independent verification } \
\text { supervision } &
\end{array}$

-A clerk reorders 250 items when the inventory falls below 25 items.This is an example of __________________________.

Accepted Answer

general au

Question 20

Employee fraud involves three steps.Of the following,which is not involved?

Accepted Answer

A)  concealing the crime to avoid detection 
B)  stealing something of value 
C)  misstating financial statements 
D)  converting the asset to a usable form 
A)  concealing the crime to avoid detection 
B)  stealing something of value 
C)  misstating financial statements 
D)  converting the asset to a usable form

Explain why collusion between employees and management in the commission of a fraud is difficult to both prevent and detect.

What are the five internal control components described in the SAS 78 / COSO framework

Opportunity involves direct access to assets and/or access to information that controls assets.

Shredding computer printouts is an example of an output control.

A shell company fraud involves

Which statement is not correct? The audit trail in a computerized environment

Contrast management fraud with employee fraud.

Internal control system have limitations.These include all of the following except

Which of the following is the best reason to separate duties in a manual system?

In this age of high technology and computer based information systems,why are accountants concerned about physical (human)controls?

Section 302 requires the management of public companies to assess and formally report on the effectiveness of their organization's internal controls.

Of the three fraud factors (situational pressure,ethics,and opportunity),situational pressure is the factor that actually facilitates the act.

A well-designed purchase order is an example of a

Control activities under SA 78/COSO include

List the four broad objectives of the internal control system.

Give two examples of employee fraud and explain how the theft might occur.

How does privacy relate to output control?

The correct purchase order number,is123456.All of the following are transcription errors except

Employee fraud involves three steps.Of the following,which is not involved?

The Information System: an Accountants Perspective

Introduction to Transaction Processing

The Revenue Cycle

The Expenditure Cycle Part I: Purchases and Cash Disbursements Procedures

The Expenditure Cycle Part Ii: Payroll Processing and Fixed Asset Procedures

The Conversion Cycle

General Ledger,financial Reporting,and Management Reporting Systems

Database Management Systems

The Rea Approach to Business Process Modeling

Enterprise Resource Planning Systems

Electronic Commerce Systems

Managing the Systems Development Life Cycle

Construct,deliver,and Maintain Systems Projects

IT Controls Part I: Sarbanes-Oxley and It Governance

IT Controls Part II: Security and Access

IT Controls Part III: Systems Development, program Changes, and Application Controls

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Exam 3: Ethics,fraud,and Internal Control

Explain why collusion between employees and management in the commission of a fraud is difficult to both prevent and detect.

What are the five internal control components described in the SAS 78 / COSO framework

Opportunity involves direct access to assets and/or access to information that controls assets.

Shredding computer printouts is an example of an output control.

A shell company fraud involves

Which statement is not correct? The audit trail in a computerized environment

Contrast management fraud with employee fraud.

Internal control system have limitations.These include all of the following except

Which of the following is the best reason to separate duties in a manual system?

In this age of high technology and computer based information systems,why are accountants concerned about physical (human)controls?

Section 302 requires the management of public companies to assess and formally report on the effectiveness of their organization's internal controls.

Of the three fraud factors (situational pressure,ethics,and opportunity),situational pressure is the factor that actually facilitates the act.

A well-designed purchase order is an example of a

Control activities under SA 78/COSO include

List the four broad objectives of the internal control system.

Give two examples of employee fraud and explain how the theft might occur.

How does privacy relate to output control?

The correct purchase order number,is123456.All of the following are transcription errors except

Employee fraud involves three steps.Of the following,which is not involved?

The Information System: an Accountants Perspective

Introduction to Transaction Processing

The Revenue Cycle

The Expenditure Cycle Part I: Purchases and Cash Disbursements Procedures

The Expenditure Cycle Part Ii: Payroll Processing and Fixed Asset Procedures

The Conversion Cycle

General Ledger,financial Reporting,and Management Reporting Systems

Database Management Systems

The Rea Approach to Business Process Modeling

Enterprise Resource Planning Systems

Electronic Commerce Systems

Managing the Systems Development Life Cycle

Construct,deliver,and Maintain Systems Projects

IT Controls Part I: Sarbanes-Oxley and It Governance

IT Controls Part II: Security and Access

IT Controls Part III: Systems Development, program Changes, and Application Controls

Filters