Auditing: Effective Internal Control

b. There are two differences between the bank statement and the check register. Describe each of them. (2-4 sentences. 1.0 points) TIP: These are transactions that Jessie

5-29 (Assertions) In planning the audit of a client 's inventory, an auditor identified the following

a. When considering internal control, an auditor must be aware of the concept of reasonable assurance, which recognizes that the

17. Which of the following is not a procedure for control of cash payments? A. B. C. D. Checks should be properly authorized with approval signatures. The business should provide written

BE4-1 Transactions that affect earnings do not necessarily affect cash. Identify the effect, if any, that each of the following transactions would have upon cash and net income. The first transaction has been completed as an example.

1) Which one of the following items is not generally used in preparing a statement of cash flows?

Name: ________________________________ Date: _________________ [1]BASIC BANK01 - BAT 003 Which of the following statements is true? A. An asset account is increased by a credit B. An expense account is increase by a credit C. A revenue account is decreased by a credit D. An equity account is decreased by a debit [2]BASIC BANK02 - BAT 010 The Income Summary account contains: A. Total revenues and total expenses for the year B. Total assets and total liabilities at year end C. Total revenues, expenses, assets, and liabilities

Bank transfer schedules are used by the auditor to address which of the following concerns?

The person performing the audit should have come across consignment documentation and as a result should have requested to see that inventory.

Internal control plays an increasingly significant role in firms and many other organizations. Businesspeople, especially managers, pay more attention to internal control and its relationship with management (Krishnan, 2005). They tend to discover how internal control affects the operation of the companies. Although managers of some companies have doubts on the value of internal control, it directly helps managers to make open and effective management of the companies when designing, undertaking and optimizing their plans. The definition of internal control is presented in the first section. Then next section shows the importance of internal control, which mainly functions as risk assessment, effective communication and monitoring,

The owner’s capital account is updated to reflect the period’s net income and owner withdrawals c. Temporary accounts are given different treatment than real accounts d. All of the above statements are correct 15. Under the cash basis of accounting, revenues are recorded a. when they are earned and realized. b. when they are earned and realizable. c. when they are earned.

P4–5 Classifying inflows and outflows of cash Classify each of the following items as an inflow (I) or an outflow (O) of cash, or as neither (N).

The primary objectives that auditors hope to accomplish by confirming a client's year-end accounts receivable is to check certain management assertions such as existence, rights and obligations, and valuation. Confirmations from clients and outside parties related to a transaction. Generally, the auditor sends to the client's customer a confirmation stating the amount owed. The customers are requested to return a statement to the auditor indicating whether they agree with the amount, or providing information about any exceptions. Confirmation from the debtor of the client is regular procedure to support existence assertion. The client's customer`s ability to pay off the debt is valuation assertion.

11. Puget Sound Co. sold marketable securities costing $80,000 for $92,000 cash. In the company’s income statement and statement of cash flows, respectively, this will appear as:

A. tax return preparation as approved by the board of directors B. basic accounting recordkeeping and financial statement preparation C. accounting information design and implementation D. Both B and C