Accounting Information Systems
11th Edition
ISBN: 9781337552127
Author: Ulric J. Gelinas, Richard B. Dull, Patrick Wheeler, Mary Callahan Hill
Publisher: Cengage Learning
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Textbook Question
Chapter 8, Problem 3DQ
“No matter how sophisticated a system of internal control is, its success ultimately requires that you place your trust in certain key personnel.” Do you agree? Discuss fully.
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Check out a sample textbook solutionStudents have asked these similar questions
Reasonable assurance that the objectives of internal control are achieved depends on the competence and integrity of personnel.
TRUE OR FALSE? WHY?
1. How does internal control impart on the achievement of organization’s goals?
2. Why risk management process is essential in addressing risks that the organization is facing?
3. Differentiate qualitative and quantitative assessment of risks.
Choose the one correct answer.
Internal control provides reasonable assurance means that ?
internal control has its inherent limitations
internal control is integrated in the various transaction cycles
internal control involves every people in the organization
evaluation of internal control is only a secondary objective of FS audit
Chapter 8 Solutions
Accounting Information Systems
Ch. 8 - What are the four major categories of pervasive...Ch. 8 - What are the differences among a pervasive control...Ch. 8 - Prob. 3RQCh. 8 - Describe some compensating controls that can be...Ch. 8 - What are policy controls plans? How do policies...Ch. 8 - Why should an organization conduct monitoring...Ch. 8 - Prob. 8RQCh. 8 - Prob. 10RQCh. 8 - What are the major elements of the strategic IT...Ch. 8 - Prob. 12RQ
Ch. 8 - Prob. 13RQCh. 8 - What are the four stages through which a program...Ch. 8 - What steps are commonly included in a business...Ch. 8 - Prob. 16RQCh. 8 - Prob. 17RQCh. 8 - Prob. 18RQCh. 8 - Prob. 19RQCh. 8 - Prob. 20RQCh. 8 - Prob. 21RQCh. 8 - Prob. 22RQCh. 8 - Prob. 23RQCh. 8 - Prob. 24RQCh. 8 - Prob. 25RQCh. 8 - Prob. 26RQCh. 8 - Prob. 27RQCh. 8 - Prob. 28RQCh. 8 - Prob. 29RQCh. 8 - Prob. 30RQCh. 8 - Prob. 31RQCh. 8 - Prob. 1DQCh. 8 - Prob. 2DQCh. 8 - No matter how sophisticated a system of internal...Ch. 8 - Prob. 4DQCh. 8 - Prob. 5DQCh. 8 - Prob. 6DQCh. 8 - Prob. 7DQCh. 8 - Contracting for a hot site is too cost-prohibitive...Ch. 8 - Prob. 9DQCh. 8 - Prob. 10DQCh. 8 - Prob. 11DQCh. 8 - The following is a list of six control plans from...Ch. 8 - Prob. 2SPCh. 8 - Prob. 3SPCh. 8 - Prob. 2PCh. 8 - The following is a list of 13 control plans from...Ch. 8 - Prob. 4PCh. 8 - Prob. 5PCh. 8 - Prob. 6PCh. 8 - Examine the last column in Table 8.2 (p. 280) for...
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- Which of the following is not one of the elements of a good system of internal control? a.Control environment b.Analysis of control procedures c.Information and communication d.Risk assessmentarrow_forward4. Many organizations implement assurance layering strategies to mitigate the risks they face to acceptable levels. One such strategy is the Three Lines of Defense model. a. Describe the first and second lines of defense included in this model. b. Explain what distinguishes the third line of defense from the first two. c. Discuss how the three lines of defense are coordinated. d. Identify the external sources of assurance that organizations use to augment their internal lines of defense.arrow_forwardThe quality of the environment in which internal control operates has a pervasive effect on many assertions. TRUE OR FALSE? WHY?arrow_forward
- Which is not among the principles contained in the development of the science of internal control? * fraud prevention supervisory review preventive controls are the best forms of control ensure objectives are metarrow_forwardWhich of the following is not a principle relating to risk assessment? a. Identifies and analyses risks and respond to changes b. Designing the information systems c. Specifies objectives with sufficient clarity d. Considers the potential for fraud in assessing risksarrow_forward4. Which of the following are true regarding internal auditors and the adequacy of an organization’s risk management process I. Internal auditors must understand the risk assessment process and the tools used to make the assessment II. Internal auditors should determine the level of risks acceptable to the organization III. Internal auditors need to be satisfied that the key objectives of risk management processes are being met IV. Internal auditors should evaluate management’s risk processes the same way they analyze risk when planning an engagement Group of answer choices I and III only I, II, III and IV None of the choices I, II and III only I and II onlyarrow_forward
- What recommendations will you give to prevent fraud?arrow_forwardWhich of the following is an inherent limitation of any client's internal control? Multiple Choice • Procedures designed to assure the execution and recording of transactions in accordance with proper authorizations are effective against frauds perpetrated by management. • Procedures whose effectiveness depends on separation of duties can be circumvented by collusion. • The competence and integrity of client personnel provide an environment conducive to control and provides assurance that effective control will be achieved. • The benefits expected to be derived from effective internal controls usually do not exceed the costs of effective internal controls.arrow_forwardWhat does Internal Control provide reasonable assurance for?arrow_forward
- Internal controls are perhaps the most important tools for managing operational risk. What are internal controls? Give three examples of internal controls and explain how each control is used to minimize operational risk.arrow_forwardWhat are the basic risk faced by financiwl intermediaries?arrow_forwardFollowing is a list of internal controls. Select the COSO component that best matches each internal control. Internal control a. Implementation of policies to reduce risk of internal control failure. b. Reporting of internal control effectiveness to investors. c. Evaluation of internal control effectiveness by external auditors. d. Identification and management of risks. COSO Control activities Information & communication Monitoring Risk assessment Control environment Assessmarrow_forward
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