SUBJECTS
|
BROWSE
|
CAREER CENTER
|
POPULAR
|
JOIN
|
LOGIN
Business Skills
|
Soft Skills
|
Basic Literacy
|
Certifications
About
|
Help
|
Privacy
|
Terms
|
Email
Search
Test your basic knowledge |
Auditing
Start Test
Study First
Subject
:
business-skills
Instructions:
Answer 41 questions in 15 minutes.
If you are not ready to take this test, you can
study here
.
Match each statement with the correct term.
Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.
This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. Management Controls Systems over Management Processes - Business Process Control Systems over Business Processes
Two Levels of Internal Controls
Components of ARM
Management controls
Internal Control auditors
2. Identify Risks - Identify Management's Response - Asses Residual Risk (Separate What is and is not important)
Strategies for Managing Risk
Components of ARM
Internal Control auditors
ERM: Top Down Approach Steps per level
3. Leadership - integrity - regulatory - technology - financial planning - human resource - operational - information
ERM: Top Down Approach Step 2
Risk Identification
Business Process Controls
Process Maps
4. Strategic Risk Analysis (external focus)
ERM: Top Down Approach Step 1
ERM: Top Down Approach Step 2
Risk Monitoring
Internal Control attributes
5. Examine internal control as part of audit process to determine reliability of info processing related to transactions - and to access control risk involving (management decision making - process monitoring - compliance)
Types of Evidence
ERM: Risk
Internal Control auditors
Five Elements of Internal Control
6. The susceptibility of the financial statements to material error assuming no internal control
Strategies for Managing Risk
Residual Risks
Inherent Risk
Internal Control attributes
7. Pinpoints problems that show up in financial results - may suggest financial misstatements - may raise concerns about the viability of the company - may indicate a potential threat to the internal control environment - may highlight potential client
ERM: Risk
High Residual Risks
Internal Control SOA requirements (auditor)
Internal Control attributes
8. Authorization(relates to ownership and existence) - Existence - Completeness - Accuracy (relates to valuation) - Timing (relates to completeness) - Posting and Summarization (relates to valuation)
Internal Control SOA requirements (auditor)
Internal Control auditors
Internal Control attributes
Internal Control Objectives
9. Competitive Environment - Management or Employee Improper or Incompetent Actions - Process Breakdowns Within Organization - Inaccurate Processing of Information
Assertions of Management
Sources of Risk
Step 2: Process Risk Analysis
Risk Monitoring
10. Most of the reference to risk concerns the company's risk of survival and includes any threat to an organization that reduces the likelihood that the organization will achieve one or more of its objectives. It is measured in terms of probability (lik
ERM: Top Down Approach Steps per level
Five Elements of Internal Control
Internal Control
ERM: Risk
11. Assessment of whether a client's internal control structure is effective for preventing and/or detecting errors
Control Risk
Internal Control Objectives
Internal Control auditors
Types of Evidence
12. Control over the organization by individuals external to org(customers - suppliers - board of directors - regulatory agencies - external audits - owners)
ERM: Top Down Approach Step 2
Sources of Risk
External Controls
Two Levels of Internal Controls
13. Responsible for giving an opinion of management's report on internal control - and must assess if the client's internal controls being used to effectively control risks
Two Levels of Internal Controls
Internal Control SOA requirements (auditor)
Internal Control SOA requirements (management)
Risk Management Process type
14. Assess the impact of process risks and the associated internal controls - Risk Identification - Risk Mitigation - Risk Monitoring
Risk Mitigation
Internal Threat Analysis
Internal Control attributes
Risk Identification
15. Residual Risk Analysis (linkage of risk to audit objectives)
ERM: Top Down Approach Step 3
Acceptable Audit Risk
Internal Control Objectives
ERM: Risk
16. Risk Assessment - Response by Management - Information Reliability - Performance Results - Reaction by Management
Two Levels of Internal Controls
ERM: Top Down Approach Step 2
Risk Identification
Risk Management Process
17. Process designed by management to provide reasonable insurance - within economic limits - that the organization's objectives are being met
Management controls
Internal Control
Strategies for Managing Risk
Internal Control auditors
18. Control Environment - Risk Assessment - Control Activities - Information and Communication - Monitoring
Five Elements of Internal Control
Types of Evidence
Risk Monitoring
ERM: Risk
19. Diagnosticity - objectivity
ERM: Risk
Attributes that influence effectiveness of control mechanism
Assertions of Management
Process Maps
20. Markets - Competitors(adv/dis) - Resources - Internal Processes - External Agents - Strategic Partners - low cost or diff - broad or narrow group of consumers
ERM: Risk
Step 2: Process Risk Analysis
OBM
Internal Control Objectives
21. Authorization - adequate documents and records - safeguarding of assets and records - independent checks on performance - separation of duties
ERM: Top Down Approach Steps per level
High Residual Risks
Risk Mitigation
Five Elements of Internal Control
22. Auditors primary concern - most likely source of problems - reflect current conditions of threats - reflect areas where the auditor needs to focus most of auditing efforts
ERM: Top Down Approach Steps per level
External Controls
Residual Risks
Risk Identification
23. Risk that the auditor is willing to take that the financial statements are not fairly stated after the quit
ERM: Top Down Approach Step 1
Assertions of Management
Acceptable Audit Risk
Planned Detection Risk
24. Organizational Business Models - External Threat Analysis
ERM: Top Down Approach Steps per level
Step 1: Strategic Risk Analysis
Planned Detection Risk
Residual Risks
25. Must state their responsibilities for establishing and maintaining internal controls and report on an evaluation of effectiveness of the controls within 90 days prior to periodic reports - state that signing officers have disclosed to auditors and c
Inherent Risk
Risk Identification
Internal Control SOA requirements (management)
Planned Detection Risk
26. Process Risk Analysis (internal focus)
Internal Control SOA requirements (management)
ERM: Top Down Approach Step 2
Types of Evidence
Step 3: Residual Risk Analysis
27. A process - management's responsibility - provides reasonable assurance to to inherent limitations (human failure - collusion - bypassing of control by senior management)
ERM: Top Down Approach Steps per level
ERM: Top Down Approach Step 2
Limitations on Management Controls
Internal Control attributes
28. Industry (competitors - potential entrants - substitutes - suppliers - customers) - Macro environmental Forces (Political - Economic - Social - Technological)
Internal Control
Risk Identification
External Threat Analysis
Risk Management Process
29. Avoidance (of activities) - Acceptance (inevitable - unavoidable) - Insurance (transferred through assurance or risk sharing) - Reduction (by implementing proactive procedures-internal control)
ERM: Risk
Strategies for Managing Risk
Risk Management Process
ERM: Top Down Approach Step 1
30. Authorization - Independent Checks on Performance - Separation of Duties - Physical Control of Assets and Records - Adequate Documents and Records
Residual Risks
Types of Evidence
Risk Mitigation
Business Process Controls
31. Planned Detection Risk - Acceptable Audit Risk - Inherent Risk - Control Risk
Components of ARM
Internal Control SOA requirements (auditor)
ERM: Top Down Approach Step 2
Step 2: Process Risk Analysis
32. Risk the auditor is willing to take that the audit procedures will fail to find material errors that were not detected by internal control
Planned Detection Risk
Internal Threat Analysis
Internal Control attributes
Internal Control SOA requirements (management)
33. Failure to communicate mission and objectives - Inaccurate or out of date assumptions - Undue focus on current conditions - Rigid organizational structure - Failure to enforce accountability - Communication breakdowns
Risk Management Process type
Management controls
Limitations on Management Controls
ERM: Top Down Approach Steps per level
34. Process Objectives(statement of what the process is trying to achieve) - Process Activities(reflect actions and steps performed to accomplish process objectives) - Process Data Streams(Information need and outputs of the process) - Accounting Impact
Risk Monitoring
Process Maps
Step 3: Residual Risk Analysis
Sources of Risk
35. Identifies measures of performance to assess whether process risks are and immediate threat
Internal Control attributes
Risk Monitoring
Step 2: Process Risk Analysis
Step 1: Strategic Risk Analysis
36. Existence/Occurrence - Rights/Obligations - Valuation/Allocation - Completeness - Presentation/Disclosure
OBM
Assertions of Management
Internal Control Objectives
Types of Evidence
37. Its a systematic and continuous process. Risk management is iterative where control is temporary and depends on current circumstances - not a permanent condition
Step 3: Residual Risk Analysis
Risk Management Process type
Internal Control
Strategies for Managing Risk
38. Documentation or Inspection of Records and Documents -Observation -Physical Examination or Inspection of Tangible Assets -Client Inquiry (do not use Independent Inquiry) -Confirmation -Recalculation and Reperformance -Analytical Procedures
Types of Evidence
Internal Control Objectives
ERM: Top Down Approach Steps per level
Risk Management Process type
39. Process Map(outlines each process) - Internal Threat Analysis(analyze each process) - Process(an organized unit within the company that has to accomplish a goal set by management) - Audit-Sensitive Processes(based on assessment auditor identifies cri
Step 2: Process Risk Analysis
Risk Monitoring
Limitations on Management Controls
Assertions of Management
40. Activities performed by senior management including strategic direction and planning and evaluating the overall performance of the organization by providing feedback about potential problems or risks that should be addressed
Limitations on Management Controls
Management controls
Internal Control Objectives
Residual Risks
41. Assess probability of the event happening and potential damage - Consider whether internal controls have mitigated the inherent problems of the risk - Identify the high residual risks that will be major focus of audit
Step 2: Process Risk Analysis
Step 3: Residual Risk Analysis
Management controls
Acceptable Audit Risk