Risk Assessment and Internal Control- Test 1

Inherent risk, control risk and detection risk are components of ______

In determining what a significant risk is, the auditor considers a number of matters, including all the following except_______

Risk assessment procedures that may indicate fraud include inquiries of management regarding:

Significant conditions, events, circumstances or actions that could adversely affect the entity’s ability to achieve its objectives and execute its strategies create:

All of the following are components of internal control except:

Implementation of a control means that the control exists and that:

The auditor’s primary consideration is whether, and how, a specific control prevents, or detects and corrects, material misstatements:

All of the following are sub-systems of an entity’s information system except:

Which of the following makes for an effective control environment with regards to commitment to competence?

To determine a positive control environment, the auditor should consider which of the following control environment actions for integrity and ethical values?

Segregation of duties means what fundamental functions which must be separated and adequately supervised?

The companies must comply with many laws and regulations including company law, tax law and environmental protection regulations requires what category of internal control objectives?

Which of the following is not one of the components of internal control according to COSO?

Key components to assess and evaluate the control environment includes:

A series of instructions and/or questions which a member of the auditing staff must follow and /or answer, is known as:

Which section of Sarbanes Oxley Act of 2001 requires public listed companies to implement, assess and ensure effectiveness of internal controls over financial reporting.

Procedures performed to obtain understanding of the entity and its environment including the entity internal control, to identify and assess the risk of material misstatement whether due to fraud or error at the financial statement and assertion level are known as _____.

Which of the following statement is incorrect?

A graphic presentation of internal controls in the organisation and is normally drawn up to show the controls in each section or sub-section is known as:

When inherent and control risks are high, acceptable detection risk needs to be low to reduce audit risk to ______. when inherent and control risks are low, an auditor can accept a higher detection risk and still reduce audit risk to _____.

Control model that guarantees the integrity of the information system is:

The purpose of Sarbanes Oxley Act is

COSO framework is designed to be used by organization to assess the effectiveness of the system of internal control to achieve objectives as determined by management. The framework lists three categories of objectives, which are:

COSO framework includes 17 principles representing the fundamental concepts associates with its five components. Few of such principles are:
1. Selects and develops control activities
2. Selects and develops general controls over technology
3. Deploys through policies and procedures
These principles belong to which component:

Key components to assess and evaluate the control environment includes which of the following:
1. Enterprise Risk Management
2. Segregation of Job Responsibilities
3. Job Rotation in Sensitive Areas
4. Documents of delegation of financial powers
5. IT based controls
select the appropriate answer: