M3 INTERNAL CONTROL

M3 SELF-ASSESSMENT

Indicate by letter the internal control that best

describes each of the listed control procedures.

a. Accuracy control--prevention
b. Accuracy control--detection
c. Safeguard control--prevention
d. Safeguard control--detection

____1. All incoming checks are restrictively endorsed

immediately upon receipt

____2. Accounting manuals are used to determine debit

and credit
accounts for nonrecurring transactions

____3. Bank accounts are reconciled monthly by persons

not
having access to either financial assets or
accounting
records

____4. Newly-hired accounting personnel undergo rigorous

training before assuming responsibility for
transaction
processing

____5. Members of the internal audit staff perform a

monthly
review of all non routine journal entries

____6. All cash receipts are prelisted and deposited

intact daily

____7. A member of the controller’s staff compares the

receipted bank deposit ticket with the cash
prelisting

____8. A set of standard journal entries is used to

record such
monthly journal entries as depreciation,
amortization,
accrued payroll, accrued interest, and bad debts
expense
____9. All revenue and expense budget variances in
excess of
predetermined levels are investigated for cause on
a
monthly basis

____10. Before signing checks, the treasurer reviews all

documentation

KEY

1. c
2. a
3. d
4. a
5. b
6. c
7. d
8. a
9. b
10. b