4-1 Assignment_ Internal Controls

ning Objective 1 S8-1 Defining internal control Internal controls are designed to safeguard assets, encourage employees to follow company policies, promote operational efficiency, and ensure accurate accounting records. Requirements 1. Which objective do you think is most important? 2. Which objective do you think the internal controls must accomplish for the busi- ness to survive? Give your reason.

QUESTION 1 The objectives of internal control are to a. provide control over "internal-use only" reports and employee internal conduct b. prevent fraud, and promote the social interest of the company c. provide reasonable assurance that assets are safeguarded and used for business purposes, financial reports are accurate, and laws and regulations are complied with d. control the internal organization of the accounting department personnel and equipment

S8-1 Definition of internal control Internal controls are designed to safeguard assets, encourage employees to follow company policies, promote operational efficiency and ensure accurate records. Which objective is most important? Which must the internal controls accomplish for the business to survive? Give your reasons.

Question 9 Which of the following is not considered to be part of the internal control structure of a company? Ensure that assets are kept secure. O Monitor operations of the organization to ensure maximum efficiency. Publish accurate financial statements on a regular basis. Ensure assets are properly used.

Chapter 10   Accounting Information Systems   Short Problem 10-3, page 394: Using the following table as a guide, describe for each function from Figure 10.1: A risk (an event or action that will cause the organization to fail to meet its goals/objectives) A control/process or use of technology that will address the risk.

Question 9 Big Data techniques implemented in the financial sector include: fraud detection O marketing email campaign O customer relationship management techniques O inventory analysis

37-Auditor conducts observation process as a part of evaluation of internal control a. To understand why the owner created certain internal controls, and what the controls are for, b. To determine how close business owners and managers are to the company’s frontline operations.  c. To understand the mindset of business owners and other managers in the company. d. To focus attention on processes that are responsible for the majority of the company’s business production.

Establishing effective controls minimizes waste, which lowers. costs and increases profits. Which objective of internal control is this statement referring to? O O о Safeguard assets Ensure accurate, reliable accounting records Promote operational efficiency Encourage employees to follow company policies I DON'T KNOW YET

Processing Controls CMA 691 4-2 Unless adequate controls are implemented,  the rapid advance of computer technology can reduce a firm’s ability to detect errors and fraud. Therefore, one of the critical responsibilities of the management team in firms where computers are used is the security and control of information service activities. During the design stage of a system, information system controls are planned to ensure the reliability of data. A well- designed system can prevent both intentional and unintentional alteration or destruction of data. These data controls can be classified as (1) input controls, (2) processing controls, and (3) output controls. Required: For each of the three data control categories listed, provide two specific controls and explain how each control contributes to ensuring the reliability of data. Use the following format for your answer.   Control Category Specific Control Contribution to Data Reliability

10.1a With regards to the Springer's Lumber & Supply case presented in chapter 10, what deficiencies existed in the internal control environment at Springer's? 10.3 One function of the AIS is to provide adequate controls to ensure the safety of organizational assets, including data.  However, many people view control procedures as “red tape” that unnecessarily slow down the process and make them less efficient.  They also believe that, instead of producing tangible benefits, business controls create resentment and loss of company morale.  Discuss this position. Explain what is meant by objective setting and describe the four types of objectives used in ERM. How would you calculate the net benefit (value) of implementing risk responses/controls? How would you determine if the risk responses/controls selected were adequate or if additional risk responses/controls were needed?

[12 Marks] Internal controls are: a. policies and procedures designed to safeguard a company's assets. b. are policies and procedures designed to produce accurate accounting records. c. are the responsibility of a company's management to develop and implement. d. are policies and procedures designed to safeguard a company's assets and are policies and procedures designed to produce accurate accounting records. e. All of these are true. Internal control systems are not designed to: a. promote operational efficiency. b, encourage adherence to prescribed management policies. c. internal control systems are designed to do all of what is mentioned in the other alternatives. d. check the accuracy and reliability of accounting records. e, safeguard assets. The Cash T-account has a beginning balance of $52,000. During the year, $365,000 was debited and $360,000 was credited to the account. What is the ending balance of cash? A) $5,000 B) $57,000 C) $47,000 D) $(5,000)

LO 6-1 Exercise 6-5A Internal controls for small businesses Required Assume you are the owner of a small business that has only two employees. a. Which of the internal control procedures are most important to you? b. How can you overcome the limited opportunity to use the segregation-of-duties control procedure? Page

19 _____________ is the whole system of supervision and control measures implemented internally by the management of an entity to carry on its business in an orderly, systematic and efficient manner. a. Internal check b. Interpersonal control c. Internal control d. None of options

Chester Company has established internal control policies and procedures in order to achieve the following objectives: 1) Effective evaluation of management performance. 2) Assure that the accounting records contain reliable information. 3) Safeguard the company's assets. 4) Assure that employees comply with company policy. Which of these objectives are achieved by accounting controls? Multiple Choice All four objectives Objectives 3 and 4 Objectives 1 and 2 Objectives 2 and 3

ACC 622 Chapter 3 Problem 12 a. Using the COSO internal control model for control activities (e.g, transaction authorization, segregation of duties) identify anypotential internal control weakness in the NSC system. b. For each weakness discuss potentila for fraud in the system. c. Make recommendations for correcting each identified control weakness.