at amore ect ene 1) =hpping deparments tended to ensue that ht EG Al ‘ ©. inventory records are reduced for the goods shipped 28, The scjusiment to accounting records to reflect the decrease in inventory dus to a sae occurs inthe A. biting department C. inventory control department 5. shipping department D. warehouse 28. Which document triggers the revenue cycle? A. the sales invoice ©. the sales orderWhich situation indicates a weak intemal control stucture? ‘A. the record keeping clerk maintans both accounts recsivable and accounts payable subsidiary ledgers 'B._ the mailroom clerk authonzes credit memos C._the accounts receivable clerk prepares customer statements every month D._ the warehouse clerk obtains 2 signature before releasing goods for shipment “The most effective intemal control procedure to prevent or detect the creation of icttious credit memoranda for sales returns is 10 "A. supervise the accounts receivable department 8. require management approval forall ered memoranda ©. prenumber and sequence check all credit memoranda fmt access to creat memoranda ‘The accounts receivable clerk desizoys al invoices fr sales made to members of her family and does not record the sale inthe accounts receivable subsiciay ledger. Which procedure will not detect this fraud? "A. prenumber and sequence check al voices B_reoncle the accounts receivable contol othe accounts receivable subsidiary ledger prepare monthly custome statements 'D__freconciefotal sales on account tothe debits inthe accounts receivable subsidiary ledger ‘which department i least ikly tobe involved inthe revenue cyte? A creat c.baling 8 shipping D. accounts payable \Which document is included with a shipment sent to a customer? sales invoice stock release form D. packing sip Good internal convos in he revenue ole should ensure al ofthe following except ‘Aa sales ae recorded ‘C.credtis authonzed 8. inventory 10 be shipped is aot stolen D. allsales ace profitable nich control does not help to ensure that accurate records are kept of customer accounts and inventor? "A. segregele record Keeping duties of general ledger fom accounts recewvable © authorze credit ._Segregate custody of inventor from record keeping reconcile accounts recewvable contol to accounts receivable subsidiary Internal contol for handling sales retums and allowances do not incide : 1 prepare the sales retums sip2 4s st 7 — computing bad debt expense using the percentage ot S _vertvng that he goods have been retuned ‘suinorzing the cre memo by management Which department prepares the bil of icing? crehowse wen on D. shipping Temitance acvice ts Ls to crease (deba) an account cash a tur around document Fae coterie a retained by the customer to show none ofthe above ae ‘A weekty reconcilation of cash receipts would include comparing 8 & Raph Seposit sips wat remittance advices. the cath praist wth remittance advices ' rekst wih bank depost sips 1D. journal vouchers from accounts receivable and general ledger At which points supervision most cxtical in the cash receptssystern? A accounts recovabie © cash cepts mom, © general edger Which journal isnot used in he revenue oycie? A. purchases joumal © ceneraljoumal 5. Sales joumal D._ cash receipts joumal Penodkcally, the general ledger department receives all ofthe folowing except ‘A tolal of al sales ‘C total of al sles backorders total noreases to accounts recebvable 1D. total decreases in inventory The crede department A. prepares crest memos when goods are retumed 5B Spproves credits to accounts receivable when payments are received ©. auihorzes the granting of creda to customers D. none of the above ‘Adjustments to accounts receivable for payments received from customers is based upon ‘A. the customer's check (Cthe cash pretst a memo prepared in the mairoom the remitance advice that accompanies payment The revenue cycle utizes al of the folowing fles except A shipping report fle ©. credit meme fe B. sales history fle D. cost data reference fle Which of the folowing functions occurs in retation o reveruelreceip transactions? ‘A. Resources are acquired from vendors and employees in exchange fr obligations to pay. 1B. RResources are sold to customers in exchange for promises for future payments. €_Resources are acqured from employees in exchange for obligations to pay. 1D. Capita funds are recewved from investors and creditor. Which ofthe folowing is not @ common activity of revenuetreceit transactions? A Order entry Receiving B Invoicing of sates D. Cash collection (Defective merchandise returned by customers should be presented to ‘A Inventory control personnel ‘©. ‘Purchasing personnel B Sales personnel D_ Receiving personnel The sales invoice ‘A. is submited tothe client by the customer, advising the cent ofthe goods ordered. 'B. Is retumed tothe cient wih the customer's payment ‘© Notifies the customer ofthe amount and terms of payment. D. Isa contract between the cient and the irucking company which caries the goods tothe customer. ‘Revere and collection cveleAn entys conto procedures include all of he folowing except 4 Contra si Reporting and Audting intemal the statement or answers the question (ne ee nas 8 kod oer 1d documents and records and accurate financial repering g ed of maintaining oun eee Son contol ar ot designed to provide reasonab fort Efeazioen vise singed vraperenty atorzeen Acs abe pert ony accor ance managers sition Fasc mnaeareneown egal agement authorization itn manage rons are executed in accordance wi The basic concopt of iter expecta abe dened i known a8 aa Reasonable assurance ae kr ardor welt pox They be caeered wih eral ane peices nd pocedu sa a A Enconey ote sision-making process. 1 ency o management ec ett 8 der eg ny scr or pret 5: Em say actucy rset sree nanciel dt aapeans ets en cgyests anal ps La GLA meeting projected proft goals most © ey sou upcanty tues an ois cont seerantwnen ‘A Exemalpoicies established by partes outside the ently affects accounting practices is dominated by ane dual karat atc tare det oes Boa of roc ak WAY management. D Th edl onniecbache bern cheno reporting poles. Managemen! phioopy and operaing syle most Ikely would have a signficaniefuenes onan enbt’s contot The moma aur repos drecty fe marageent 8. Managements dominated by one ndidca &: Acute mage orpton deaae speci ule, D. The audit commites atively oversees the financial reporing ecess Sorgrmontorngwitn an temal con ranework nce alte folowing excel "7 Ep An intemal auct department ‘A. An extemal auditor 5. An effective aut committee ©. The intemal revenue service, ‘A Performance reviews 8. Information processing . Extemal auditors tests of controls D. Segregation of utes 5 Foetal beneis ofan ety’ contain an T envionment eM a Sa following except 4 Redon nine nak hat contots wile citer ene More accurate accountng estate & Consistent application of predefined business rues, $ 10 More timely inonnaton ‘An entity’ information system inrasiuctur refers to ‘A. Hardware components Sofware, 8 Programmers. D. Data provided by the system, 2 geactonrltedassrion of completeness ensies tet 1 A. Alltransactions processed are vali & Alltransactions are property authorized. 8. Allvansactons are incused DA ‘8 recorded on a timely basis. I fansacton slated asserion of occurence snsue bey : s A. Alltransactons processed aciually cceurea d 9:10} sis! eso 8. Alltransactons are included, ? C. Al transactions are propery authorize, D._Alltansactons are recorded on a timely basi intemal Conover Financial Reporting, ‘and Auditing intemal Contro|at s Lays are val C. Alltransactions are property approved. ona pest a S. Altwansactons are recorded on aiimety bass. sone a ver audit evince sll using substantive testy : .guner mut evince SRN Pl ik VOY Me metine Serecurng system. mn effecve system ofinieel accountng convo calis for separation ; soy een an m9 fence emcee amr 6. Sioratn per remeing ete must shuld consider ak ncreasihg the efectvaness of he aut ol i emia tee Si ert memenet Foor a cee tty t mena of anger ee ican c eedacaer nea utr § Rescate an aa eras’ unaranir finan ta Ee vy terrae, qotar exch em & tees SNe etna ue ec. 2 ace toan anatase seer eg min wane b Sepereanc peace 1 nmetnete noe oct tani aca be sto ec en nappa f Emrens Seer ong ca ftv chceetet pect ateh 5 Seelam ret are hance ar a ec tow doe rao see eee ee Seat ee een fever ance an sce cas sata Cha ev pein otc D. Reduce the need to observe cients’ employees performing routine | eacec teen seateicatsfeae cia era Se eee i teeraaps viebenraeie creer € aber spuen ee Seles st Rent D._ Tests of he additions to property, plant, and equipment by To obiain evidential matter Neral about contro risk, an Reports on sevice organization ‘AY Provie reasonable assuranene cent sled oct, Prevent management © Relate 1 the contol envasrent > Reflect managements philosophy and operating se — 27. In evaluating intemal accountng re tn eal 4 ting Cont, the audios basicaly concemed thal Se Sl so rs. e cen carer by coluson a ot oven h ytr gt asst — 2% Of a olowng str aboutan Veal cantly whe oon Se ae mantenance oe syiem of moral cco cones sea ‘ Ec = ftmalaudir 7 *7 a omy sere mae conor rect te sleguarig of ase an he yan a tot ge ‘and approval, a meanioa of a0 end fe ater se ©. Becaute fhe costbenet latent, teal contol rceaies ma “eal gorse some circumstances, % Cae oe erat on ates aan ral accounting conl procedures easonaby prevent olson arr empl 2 surance te contentl a omy Sire conse 3 misstatements 8, Proper intemal controls guarantee that materal mistatements wl nt occur o . Proper intoral eantols preclude fraud D._ The costs of some contols may be to extreme to implerentin relation fo poll ans 5 90. Anetfetve contol environment ne corte ‘A. Allows management fo Senty al levant sks. iegeg cote Creates a commimentto competence. wh woes Guarantees that al controle are folowed as prescrbed. Snes Di aie iene selene tae oe a exits ___ 31. The contol environment camponent of nial contol ncides al fhe oi. Somes ‘AY Managements operating ye. ¢"Oroenastona see ers 5 Access computer programs. Human resoure polls ad ect cos NIMES G2, Iifernaton ed cxrrncaies peel tee RR ‘stoma ‘Identifying and recording al valid rensactons, Scone wt 8 Determining he ime pened in whieh ransactons occured. earn! ©. Communicating pce changes fo customers. oem a D._ Properly presenting vansactons and elated cscosuresin the Jewel! 33, An orpanzatona ruc np fo-o 6 HEE reas "A. Ensunng proper monitoring vee 8. Defiing areas of autonty CPAs Pine 94. The isk assessment component of internal conto teers © aot ‘4 The auditors assessmentofcontolrise agit © The auditors assessment of aude risk ne The entysidentfcation and analysis oa oh D. The entiy’s montring of the potential for materal miss ‘eagernee,__35._ In planning an audit ofa new client, an auditor most kal tore may fe Inomaten because ich nebo te ‘A. Influence the design ofthe Cavey fe 8 Affect the auditor's i taramay © Assist evaluating the pla hatter 1D. Determine the audtors acoeptat weir — 38. AS opposedtoretancesatagya substan condone ¢ Increased implementation feoonabe vesowled 3. pnt tenableJoh a «mina vel S099 ag sinters. conceming contol atk is comet? soon eae nl ik ang obtaining an understanding ofan Soe ‘concurrent. GRE Tonea an a he maximum eve, ener eet at maybe assessed sfc lw simile substantive eng for sicantanscton Stee {ten setesing cont nak an audio should rot consider evden obtained in por aus about the operation efConrapoceaires Assesang conolrsh at Blow te max most ke would invohve ‘2°"Sheraa he ming of substan eis by orting nen estng and peorring te tess at yar tos 2, onuing spec inemal contol vena spcicdestrione ¢Pever more sxenave subranive ese nth aga ceip ses han gal plane, D._Reaicng herent sk frmoatohe seers rlsvart is gc acoso blero ° 58 Ine ust of financiers an autos primary consdeaton regarding an intemal on poy or procedure exe —— " swhetrer the poly or procedure 7 om ‘A. Reflects managements philosophy and operating style. = 8 Affects managements fhancial statement assertons, a Provides adequate safeguards over access fo assets. = 1. Enhances managements decision-making processes. — 42 Whch of te folowing most ikely would nat be considered an inherent imitation of he polenta ete civeness of an 4 ‘ent’ intemal conto structure? ‘A. Incompatble duties © Mistakes in judgment 8. Management verde: D._ Collusion among empoyees, — 47 tlsimporantfr the CPA to consider the competence of te aud cents’ employees because their compalonce bears Sirecty and importanty upon the ait a ‘A Costbenefitrelationship ofthe system of internal control a B Achievement of the objectives ofthe system of intemal contro. . Companson of recorded accountabiiy with assets, > Timing ofthe tesis tobe performed 42. Aspartot understanding intemal contro, an auditor isnot required to = ‘A. Consider factors that affect the risk of material misstatement. 3. Ascertain whether intemal contol sructure policies and procedures have been placed in operation. _Ieentty the types of potential misstatements Pat ean occur. ® D. Odiain knowiedge about the operating effectiveness of the intemal control structure. —— 4. Effectve intemal conto in a small company that has an insufficient number of employees to permit ‘esponsibiltes can best be enhanced by a ' A.” Employment of temporary personnel to aid inthe separation of utes , Breet parcipason by the owrar ofthe Susiness inthe recorteepinj ace of ne © Ergegn » GPA b porn monty bookkeeping 9. Delegon offi clearcut responaay each employee fr he functions assigned o “4 The edeoencel aur shoud ature an uaeaananget he eal uae neon an ‘ contl nok because 7 4 ntemalaudtors aust programs, aud documents, and repos can often be used the work of the independent auditor's staff. ' 8. The proceaires performed bythe nema uct taf may elminae te independent an extensive study and evauaon of intemal conl i © Tne wor permed by iteral ators may bea factor determining the of he independent autor's procedures, ©. The uncerstancing of he intemal suc uncton is an important substantive the independent autor — 45 I siainng an understanding of an entiy's intemal contol sytem na reed comer pisces termine whether the control. have been | ee 8. Perform procedures to understand the design of the internal control: Document the understanding ofthe entity’ internal conivol system . Search for sgnifeant defences inthe operation ofthe tema ‘Intermal Contr over Financial Reporting and Auditing intemalbe vey Aayy Jenauaym sane £ if i “5 eee 0 JeUsayy) “sagap a1and Busey « preinary phase ofthe review of intemal accounting conto, the auctor decides not 0 rely on sa camresreruosanve eats, Documeraton may be ited oe autos ses rng of the intemal accountng con system A. Roseons for decing nolo extend the review. 2 Besser concluding thal erors and fraud willbe prevented 5 Betpiete intemal accounting coil questionnaire ust of francial statements in accordance wih generally acce eesti specie internal contol svucture procedures relevant to manage ner compietng th ted auditing standards, an aucitoris required to Inan smert’s financial statement A assertons. B_ Bevforn tests of Controls to evaluate the effectiveness ofthe entity's accounting system Became whether procedures are sulably designed to prevent or detect material misstatements 5 Document the auditor's understanding ofthe entity's intemal control structure Fora complex system, auditors are least likely o use which ofthe folowing when cocumenting their understanding of 48 internals controls? A Narratives. c.. Flowcharts. B._Interal control questionnaires. D._ Organization charts 49, Assessing contol risk below maximum involves all ofthe following except ‘A. Identfying specific controls to rely on. 8. Concluding that controls are ineffective © _ Performing tests of controls, 1D. Analyzing the achieved level of control risk afler performing tests of controls, t 60. When an auditor increases the planned assessed level of control risk becaus® certain control procedures were determined to be ineffective, the auditor would most likely increase the ‘A. Extent of tests of details, ©. Extent of tests of contro, 8. Levelofinherent risk D._ Level of detection risk. 51. Which of the folowing procedures most likely would be included as part of an auditor's tests of controls? ©. Confirmation. ‘A. Inspection B Reconcilation D. Analytical procedures. 52, An auditors least ikely to test the intemal controls that provide for ‘A. Approval ofthe purchase and sale of marketable securities, 8. Classification of revenue and expense transactions by product fine. ._ Segregation ofthe functions of recording disbursements and reconciling the bank account 1D. Comparison of receiving reports and vendors’ invoices with purchase orders. 53, For certain controls, suchas segregation of duties, documentary evidence may not exist An auditor fest the procedures by ‘A. Reperformance and corroboration. ©. Inspection and youchirg. yee and inquiry 1D. Confirmation and recomputation. \Walk-throughs usually involve all ofthe following aucit procedures except ‘A. Reperformance. mou. Observation, B. Inquiry. 1D. Inspection,ss s 58 58 6 cy —— soe saan of courte at anna ate por tte balance sheet die, sorte assrtons embodied in the accounts selected for nw ta 0 ar ected for interim testing are reasonably financial records and related data wil be oxen ne ‘an auctor eho ak at betow the mas Step mt te sea en or yrs at 3 ee rom manager at > Sean erm ceo - eee ang ron eto a see vy rsance oy ana proce as substantive tests, Sasacte . ae Riera, sy semtnddetteratencoe be vs ee eee 2 ton ss to cae shin ng ecm 5 Soci cet cnge tte § Seater encase Oe rca aso teeny us 281 yaend Ceara to mea f Ateae aor montng pe Eee eater 5 acetate petal nent pr sedans say on anc erg ot bo et Deed et mc Tie er ee eee Serres temae tan aah me tad ee a substantve testing ©The audior used nonstatstical sampling during interim compliance testing. © Inquines and observations lead the auctor to Believe that conditions have changed. Lake, CPA, is auditing the financial statements of Gill Co. Gill uses IT Service Center, ‘ransactons. (T's nancial statements are audited by Cope, CFA, who recent issued a structure Lake is considering Cope's report on IT's intemal control structure in ass ‘esponsibility concerning making reference to Cope as a A Lake may refer to Cope only f Lake is satisfied as to Cope's independence ate may refer to Cope ony Lake relies on Cope's report in esting the Lake may refer to Cope onty i Lake's report indicates the division of Lake may not referto Cope under the circumstances above Wich ofthe following statements is correct conceming an auditor's. ‘attrs (reportable conditions) noted in an audit? ‘A The aucitor may issue a written report to the audit commitiee Conations were noted during the audit. © Reportable conditions should be recommunicated each year, cc Repziedged ls understanding of such defezencis. Portable conditions that are material : ne conden ‘weaknesses should ‘may choose to communicate significant it ours of the audit or after the audit is concluded. The auditor's commur A Required to errs thal 163, Reportable conaitons are matte 70, 1. to he board of directors or the board's audit committee, Regured'o be documented na wise” Oren autre atten tat shoud be communicado ar entity's auett Regul ‘come to an au wficanty contradict the auditor's going concem assumption resent Ere bcm hey Teese Faas ecral ats perpetrated by hghievel management 8 Maral rusor & Sentean tenes nth, 5 ianpuatonorflsfeaton «communicating reportable condtons species that reportable conetions “The audtors responsi fore or operation ofthe internal contro structure, 'sccouning records or documents from which nancial statements are prorred 2 taped omaaporat be sider dors seh cnmanctors a acest "bo eporace manapeme © Mayoereyoneato me aust commits 5 itsibeeporag totes commaton [Alot neflowing are reporabi condtons except 1A game of topoprate tows of tansacis 8 Encene eft wrongsingbylwerievel aployees & Inadequate provitons fr salequerdng assets 5. invents hgh sujet sesoacance ‘he noma sequence of documents and operations ona wel prepare systems fowchartis "Topo botiom and right 4° Topload org 5 fepifaton ar 3 Bottom to top andi tog mo ep and ight tole font oc ca ee scam of eral cnt, the dependent audiordmwaes Us seo) flowchan whch can best be desrbed 4s A288 De ag A Peto presenta of te fow of ? cd B Diagram tichcleary indicates an organzaton's iiemal repos oe operations which is used to replace the aueltor’s intemal contol - C. Graphic illustration of the fow of questionnaire, SCOR SN py of contol isk 8. Areducton in the assessed! ©. htwouldbe! A Bocuenistn aa need be waseses hl might low c. That the auditor plans to ly on. ene aa © That wou ie oem tte ay ee yor ct 8B. fee Provided by tests of controls by using a larger: ay aie ne poe er ‘Tests from year-end to an interim date, see ate eet2 nar amt anc ace Hoes ) envzormens a planning have been placed in operation. eas is relevant 10 a ra ana te denn Mrinal is best obtained By ls ‘operated consistently throughout the period. = ssetecmna eran Ste se tests frequently provide no affirmati 3 78. While substantive tests may SUPP: eect tt gcoleman eal b taacon has Erie nega een ough ty wo mained by paren hn ore a yf audit, but compliance tests cavsieut aetna ' San i ethane er impute 10 performed them, so substartive tests may tary Srmpterzed procedures eave no audit ail of who pe © ethsany be lmtea fo nqunes and observaton of offew personnel. 17 before appving poncal substantive esto the details of asset and labilly accounts at an interim dat, the iva se eses ine cum contoing aust nek forthe remainder fhe period 3 invesigate sgnfeant fucuaone thal have occured nthe asset and labily accounts since the vance sheet da 78. When communicating intemal controkrelated matters noted in an audit of a nonissuer, an aueltors report ~~ reportable conditions should indicate that ‘A. Errors or fraud may occur and not be detected because there are inherent imitations in any control system, 5. The issuance of an unqualified opinion on the financial statements may depend on coectve! up action ©The deficiencies noted were not detected within a timely period by employees in the of performing their assigned functions, ._The purpose ofthe auct was o report on the financial statements and not to provide internal contro, — 7 The program flowcharting symbol representing a decision is a : A” Trangle, © Rectangle. 8 Circe ©. Diamond, — ®t necemal ur cam aed wath all of the following except: a on CBP sesponstolity forthe effectiveness ofthe entity's Pr ‘internat control over 5 Evauate te efectveness of the entity's intemal consol ever raga aofteend atte Slang iy “pitied ud a tad in Sucton 404 of he eee the auditor must corse tegrated toughis and ideas of anal staan in an et one on marapenents llega theses —2ute assurance on the fancil statements vance on lea ont tements anneal contol reasonable ance on bath he fant eens and internal control , " ._ spsolut taecraanco on both ihe #ancia 1¢ internal controls over financial reporting process of an 5 esters eaping He ral onl o fan opring According the PORES C. an intemal control specialist Srp entity's CEO andor CFO B._ the extemal auditor gous 3 A ai wrt gat customers dos ot ope understand whal conees @ cred — Fins an exam of © adefcencyin operation cool teney 1. This snot an intemal contol deficiency Ba design deicieney snore is more than @ remote likelhood of misstatement in the financial statements and a A defcincy ha pk ge the mssatement fo be consequential ee reasonable person would cor C._ an insignificant deficiency a amatoal weakness Bi Stina abn | sen ina top troqures special coneleran by. manegementslng manayenecCsherpa sa wstment process and by te auctor during the audit of intemal contol? Fr itilelocatons and business units {C" The ele fT in internal control escent D. Safeguarding assets 7 nagar cura hud ee ate owing ce Cmentaton regarang te audit's evaluation of neal controls ae 2: Documentation regarding managements tesing end evaluator of he comes w wECR C._ Documentation regarding the safeguarding of assets ©. Documentation onthe contfos designed inal ve components of intemal control 28, Which of he folowing i nota primary objective of internal contol as established by COSO: ‘A. Effcency and efecbveness of operations" C” Comptance with aws ard regulations 5. Effcive purchasing ystems ©. Relable francial reporting, {88 The main goal of aucsing intemal conto s ‘Av To alow the auctor 'o fix any intemal control deficiencies 3. To form an opinion on he ality of intemal conto to stop fraud ©. To assure management that intemal conto is preventing all material misstalerents onthe fnanclal “= “l= statements és . To evaluate efectveness of contol ove all relevant francial statement disclosures in the finan statements 20. An auctor performing an internal control auct would be required to: ‘A. Evaluate the design of specie contols fora private ent 8. Testallof te entys intemal controls | Form an opinion ofthe effectiveness of intemal contro! ©. Randomly identfy accounts for an aut of ilemal contol — 81. In determining the extent to which the auctor may use the work of others, he audtor should except ‘A. Test some ofthe work performed by others io evaluate the quay and 8. Evaluate the nature ofthe controls subjected tothe work of olners 4 Evaluate the competence and objectivity ofthe individuals who performed he 0. Allofthe above are requred — _% Which ofthe fotowingis the eas kel o represent a material weakness in Ayn Comoros sedis a, SmPloyees needed todo al reconcilatons manual, Fit Gomoraton’s CFO was arested last year for embszzing 3. San Ht Aut Commitee is deemed tobe ineffective. ‘S&H Accouning has jst pe aa Tanager ada tomes an sud of abs Blas, SAH tral Ar SAH must stil assum © Sar angio" ther factors in the auct, S&H can sil 6. Consider this situation a limitation on the clog | C°*8 Mot need to give SBH a letter if Mars Ine *! Contl over Franca Reporting and Audi| control over francial poring, as required by the Sarbanes-Oxley Act, era fe er rt iio 6 NCAT en input te accounting amen ate ple 2 iy toasting aerial sla lar Ron nthe design ler or pon Asitement of manage fees with the public accounting i's assessment © Gertnara PF ngnermanagerent agrees wh he pub 9 acne tons othe intemal control envionment that eceured © ina CO ing anges or adtions othe intr A otaed statement iz ing the auditors report on intemal control over financial reporting is correct? folowing concern Asecrowad ror opinions on the effectiveness of intemal contol over mancal reporeng 2 lebanon ee ee eed © ladon state management's assessment of internal control over financial reporting, but a omy eee eee siacplsdega upaton tne ns ov mate APSO HIOA, ea ae procedures scien deny a contol defences 8 Carmi fo management n wring, al conta ceicences previously oluded in wien o Siecaaatsaaese aU nom soncessmasoacn resancstan Sp te a ec a ©. Reiman neha tow neenogemmamnrn sere ne res gee tenn o, Hinata Sascha eee home £ Wears amen snes & ayia aus san ner ou D. of audits of intemal contol over financial reporting and of nancial statements. — — © Peetmepe tgs copncre tema nn tones aga gan alow ead talons ace so for are Sco Sted iow aro fo aetna ecto da pce sass Dene f% fle hey pe cc ene 100. we a following audit, ‘Procedures would an auditor be least likely to perform usin ae i domi i iy at Investigating inventory balances for Possible obsolescence. mien 10, = definition of Tins intemal control over fnancial reporting the maintenance of asset the segregation of dutieg, mae the authorization by Ie satequarding of eangdeMen of recep and expenditures ‘nt Conve Franc Reporing and Auditing InternF rt tectiveness of internal cont LS rere A jementof managemeti rgultin misstatement ? ure of 2 ont luge inte evaluation ne 2st asneae ete a 95 and Malet contol eflechveness ie ¢ sere caesar Om docurentaon finer antl? a aan eda tue 2 fees senate oer Sete rhe met nesalopting pact © me Doce ii ul oes oF OPES oa 5 Scars Matec neds angen snc nina co 2 aren mae S & Sie anonrne a = the followin Jncial reporting objective of intemal controls omg sen lt ree negara coer tanet — ASN lng rim as ence cepadty OSS Meet © theories § Miter rer elon A Aagressed Oy management © era se aren Be a monet ne coe Reine ee nf tthe component ng Pen ta ey © lee rn wih meget cmcarig $e pot atl Alot he above are required * 107, The Sarbanes-Oxley Act requires reporting onthe effectiveness of internal control over nancial reporting via: TR” Management statements inthe annual reper BA spacial quarterty fling from management de footnote tothe auctor report 4 5. direct eter tothe SEC signed by management and the auctor 108. AAA Accounting recently fnished auditng LinktneEartn Corporations intemal conto over found a number of material weeknesses in the company’s intemal conto structure. LinktheE art's alo the weaknesses that AAA found. LinktheEarth’s management, however, did not have time Controls. Wha report should ANA issue with regards to internal control over financial reporting? ‘A Unqualified report Qualified report B Adverse report Disclaimer on opinion 108. According othe COSO definition of safeguarding of assets ‘A. Contols aver financial reporting are effective if they provide reasonable assurance: willnotaccur Contos over financial reporting are effective i they provide reasonable ass property refiected in the financial stternents I ©. Both Aand B D. Nether nor B 4 — 10. 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