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1. Internal control a. Two or more people working together to overcome internal controls. 2. Control procedures 3. Firewalls b. Part of internal control that ensures resources are not wasted. 4. Encryption c. Requires companies to review internal control and take responsibility for the accuracy and completeness of their financial reports. 5. Environment 6. Information system 7. Separation of duties d. Should be prenumbered to prevent theft and inefficiency. 8. Collusion e. Limits access to a local network. 9. Documents f. Example: The person who opens the bank statement should not also be the person who is reconciling cash. 10. Audits g. Identification of uncertainties that may arise due to a company's products, services, or operations. 11. Operational efficiency 12. Risk assessment h. Examination of a company's financial statements and accounting system by a trained accounting professional. 13. Sarbanes-Oxley Act i. Without a sufficient one of these, information cannot properly be gathered and summarized. j. The organizational plan and all the related measures that safeguard assets, encourage employees to follow company policies, promote operational efficiency, and ensure accurate and reliable accounting data. k. Component of internal control that helps ensure business goals are achieved. I. Rearranges data by a mathematical process. m. To establish an effective one, a company's CEO and top managers must behave honorably to set a good example for employees.

1. Internal control a. Two or more people working together to overcome internal controls. 2. Control procedures 3. Firewalls b. Part of internal control that ensures resources are not wasted. 4. Encryption c. Requires companies to review internal control and take responsibility for the accuracy and completeness of their financial reports. 5. Environment 6. Information system 7. Separation of duties d. Should be prenumbered to prevent theft and inefficiency. 8. Collusion e. Limits access to a local network. 9. Documents f. Example: The person who opens the bank statement should not also be the person who is reconciling cash. 10. Audits g. Identification of uncertainties that may arise due to a company's products, services, or operations. 11. Operational efficiency 12. Risk assessment h. Examination of a company's financial statements and accounting system by a trained accounting professional. 13. Sarbanes-Oxley Act i. Without a sufficient one of these, information cannot properly be gathered and summarized. j. The organizational plan and all the related measures that safeguard assets, encourage employees to follow company policies, promote operational efficiency, and ensure accurate and reliable accounting data. k. Component of internal control that helps ensure business goals are achieved. I. Rearranges data by a mathematical process. m. To establish an effective one, a company's CEO and top managers must behave honorably to set a good example for employees.

Principles of Accounting Volume 1
Principles of Accounting Volume 1
19th Edition
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax
Chapter8: Fraud, Internal Controls, And Cash
Section: Chapter Questions
Problem 2MC: Internal control is said to be the backbone of all businesses. Which of the following is the best...
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Understanding internal control, components, procedures, and laws

Match the following terms with their definitions.

1. Internal control a. Two or more people working together to overcome internal controls. 2. Control procedures 3. Firewalls b. Part of internal control that ensures resources are not wasted. 4. Encryption c. Requires companies to review internal control and take responsibility for the accuracy and completeness of their financial reports. 5. Environment 6. Information system 7. Separation of duties d. Should be prenumbered to prevent theft and inefficiency. 8. Collusion e. Limits access to a local network. 9. Documents f. Example: The person who opens the bank statement should not also be the person who is reconciling cash. 10. Audits g. Identification of uncertainties that may arise due to a company's products, services, or operations. 11. Operational efficiency 12. Risk assessment h. Examination of a company's financial statements and accounting system by a trained accounting professional. 13. Sarbanes-Oxley Act i. Without a sufficient one of these, information cannot properly be gathered and summarized. j. The organizational plan and all the related measures that safeguard assets, encourage employees to follow company policies, promote operational efficiency, and ensure accurate and reliable accounting data. k. Component of internal control that helps ensure business goals are achieved. I. Rearranges data by a mathematical process. m. To establish an effective one, a company's CEO and top managers must behave honorably to set a good example for employees.
Transcribed Image Text:1. Internal control a. Two or more people working together to overcome internal controls. 2. Control procedures 3. Firewalls b. Part of internal control that ensures resources are not wasted. 4. Encryption c. Requires companies to review internal control and take responsibility for the accuracy and completeness of their financial reports. 5. Environment 6. Information system 7. Separation of duties d. Should be prenumbered to prevent theft and inefficiency. 8. Collusion e. Limits access to a local network. 9. Documents f. Example: The person who opens the bank statement should not also be the person who is reconciling cash. 10. Audits g. Identification of uncertainties that may arise due to a company's products, services, or operations. 11. Operational efficiency 12. Risk assessment h. Examination of a company's financial statements and accounting system by a trained accounting professional. 13. Sarbanes-Oxley Act i. Without a sufficient one of these, information cannot properly be gathered and summarized. j. The organizational plan and all the related measures that safeguard assets, encourage employees to follow company policies, promote operational efficiency, and ensure accurate and reliable accounting data. k. Component of internal control that helps ensure business goals are achieved. I. Rearranges data by a mathematical process. m. To establish an effective one, a company's CEO and top managers must behave honorably to set a good example for employees.
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