Accounting Information Systems
11th Edition
ISBN: 9780357156032
Author: Ulric J. Gelinas; Richard B. Dull; Patrick Wheeler
Publisher: Cengage Limited
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Question
Chapter 7, Problem 2P
Summary Introduction
To conduct: A research on the internal control of an organization and to prepare a report.
Introduction:
It is an information structure which collects and manages data of an organization which can be utilized by analysts, managers, and other decision making authorities of an organization.
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Students have asked these similar questions
Identify how each of the following statements relates to the performance principle by considering which element(s) of the principle are
related to that statement. (A statement may be related to more than one element.) Use the following elements in providing your
response:
Reasonable assurance
• Planning and supervision
• Materiality
⚫ Risk assessment
• Audit evidence
a. Evaluating the effectiveness of the client's internal control in preventing or detecting misstatements.
b. Obtaining an understanding of the client's business and industry.
c. Acknowledging that the risk of failing to detect a material misstatement cannot be reduced to zero.
d. Obtaining confirmations from the client's customers as to the ending balances in accounts receivable.
e. Preparing a written audit plan.
f.
Designing audit procedures to identify misstatements that would have a significant effect on financial
statement users' decisions.
g. Considering the likelihood that the account balance contains a material…
When planning the audit of internal controls for an issuer, the audit team shoulda. Identify significant accounts, locations, and assertions.b. Conduct a walkthrough of the internal control process.c. Make inquiries of employees regarding the existence of control activities.d. Reperform control activities performed by client employees to determine theireffectiveness.
Which of the following elements of internal control includes maintaining records of employees documenting their compensation and promotion?
Control procedures
Monitoring
Control environment
Risk assessment
Chapter 7 Solutions
Accounting Information Systems
Ch. 7 - Describe organizational governance.Ch. 7 - Prob. 2RQCh. 7 - Describe the eight elements of ERM.Ch. 7 - Describe and compare risks and opportunities.Ch. 7 - Prob. 5RQCh. 7 - Prob. 6RQCh. 7 - Prob. 7RQCh. 7 - What is COSO?Ch. 7 - Prob. 9RQCh. 7 - Prob. 10RQ
Ch. 7 - Prob. 11RQCh. 7 - Prob. 12RQCh. 7 - Prob. 13RQCh. 7 - Prob. 14RQCh. 7 - Prob. 15RQCh. 7 - Prob. 16RQCh. 7 - Prob. 17RQCh. 7 - Prob. 18RQCh. 7 - Prob. 19RQCh. 7 - Prob. 1DQCh. 7 - Prob. 2DQCh. 7 - Prob. 3DQCh. 7 - Provide five examples of potential conflict...Ch. 7 - Prob. 5DQCh. 7 - Prob. 6DQCh. 7 - Prob. 7DQCh. 7 - Prob. 8DQCh. 7 - Prob. 9DQCh. 7 - Prob. 1SPCh. 7 - Match the concept in List 1 with the definition or...Ch. 7 - Match the concept in List 1 with the definition or...Ch. 7 - Prob. 4SPCh. 7 - Prob. 1PCh. 7 - Prob. 2PCh. 7 - Prob. 3PCh. 7 - Prob. 4PCh. 7 - Prob. 6P
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Similar questions
- Write a comprehensive research paper on on internal controls and internal auditing. Clearly Defining what is meant by internal control, Distinguishing among the major components of a client’s internal control: the control environment, risk assessment, control activities, the accounting information system, and monitoring of controls. And lastly, Describing the auditors' consideration of internal control.arrow_forwardDiscuss the auditor's risk assessment procedures for assessing control risk, and provide specific procedures related to understanding management's risk assessment component of internal control.arrow_forwardwhat audit determines whether organizational policies are being followed and whether external mandates are being met?arrow_forward
- Audit procedures designed to evaluate the operating effectiveness of controls to prevent, detect, or correct material misstatements are known as organizational structure. O control testing. O commitment to competence. O management's philosophy and operating style.arrow_forwardMatch each of the following control activities with its definition. Control Activities Definitions 1. Separation of duties 2. Physical controls 3. Proper authorization 4. Employee management 5. Reconciliations 6. Performance reviews a. The company should maintain security over assets and accounting records.b. Management should periodically determine whether the amounts of physical assets of the company match the accounting records.c. The company should provide employees with appropriate guidance to ensure they have the knowledge necessary to carry out their job duties.d. The actual performance of individuals or processes should be checked against their expected performance.e. Authorizing transactions, recording transactions, and maintaining control of the related assets should be separated among employees.f. To prevent improper use of the company’s resources, only certain employees are allowed to carry out certain business activities.arrow_forwardAnalyze what information the auditors are needed to provide to those in charge of the client's governance.arrow_forward
- Select the appropriate control activities for each of the following definitions. Definitions Control Activities a. The company should maintain security over assets and accounting records. Management should periodically determine whether the amounts of physical b. assets of the company match the accounting records. The company should provide employees with appropriate guidance to ensure C. they have the knowledge necessary to carry out their job duties. The actual performance of individuals or processes should be checked against d. their expected performance. Authorizing transactions, recording transactions, and maintaining control of the е. related assets should be separated among employees. To prevent improper use of the company's resources, only certain employees are allowed to carry out certain business activities.arrow_forwardExplain the primary purpose of the Management letter. Discuss the various components of internal control in the COSO internal control framework. Explain the concept ‘review of subsequent events’ and their significance in the audit of a client. Explain the concept ‘Contingent liabilities’ and their significance in the audit of a client.arrow_forwardIn which element of Internal Control are personnel policies included: Control Procedures Control Environment O Risk Assessmenet Information and Communication O Monitoringarrow_forward
- What measures does the governance board can put into place to establish ethical expectations.arrow_forward9. Procedures that can be used in obtaining a sufficient understanding of Internal Control include the combination of any of the following procedures, except; a. Inquiry of the profile and appropriateness of the client's personnel b. Future engagement plan with the client c. Review of the accounting manuals and organizational structure of the client d. Observation of the activities of the client e. Previous experience with the clientarrow_forwardWhat are the components of internal control per COSO’s Internal Control—Integrated Framework? a. Organizational structure, management philosophy, planning, risk assessment, and control activities. b. Control environment, risk assessment, control activities, information and communication, and monitoring. c. Risk assessment, control structure, backup facilities, responsibility accounting, and natural laws. d. Legal environment of the firm, management philosophy, organizational structure, control activities, and control assessment.arrow_forward
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