1.

Relate primarily to the safeguarding of assets and include such measures as safes for the
storage of cash prior to deposit, vaults for the deposit of cash, safety deposit boxes for the
storage of important business papers, and locked warehouses for inventories

Answer: Physical Controls

2. Includes bonding of employees who handle cash, rotating employees duties and requiring
employees to take vacations, and conducting thorough background checks

Answer: Human Resource Control Measures

3. May result when two or more individuals work together to get around prescribe controls and
may significantly reduce the effectiveness of a system

Answer: Collusion

4. To safeguard cash and to assure the accuracy of the accounting records for cash, effective
internal control over cash is imperative

Answer: Cash Controls

5. To enhance the internal control over cash disbursement

Answer: Voucher System

6. A voucher system includes the use of authorization forms which are recorded by the
accounting department in the voucher register

Answer: Voucher

7. A cash fund used to pay relatively small amounts

Answer: Petty Cash Fund

8. The operation of the fund, often called an

Answer: Imprest System

9. Are short term highly liquid investments that are both readily convertible to known amounts
of cash, and so near their maturity that their market value is relatively insensitive to changes of
interest rate

Answer: Cash Equivalent

10. Are company employees who continuously evaluate the effectiveness of the company’s
internal control systems

Answer: Internal Auditors