WorksheetsAIS - CONTROL
Total questions: 42
Worksheet time: 21mins
A system is
a regularly interacting or interdependent group of items forming a unified whole
a collection of elements or components that are organized for a common purpose.
is a way of working, organizing, or doing something which follows a fixed plan or set of rules.
All the above
3 main components/ steps of a control system
process--> input--> output
output---> input---> process
input--> process--> output
process--> output --> input
Which of the following parties is responsible for establishing a company's internal controls?
Auditors.
Management and auditors.
Committee of Sponsoring Organizations.
Management.
Which of the following is not one of the three primary objectives of effective internal control?
Efficiency and effectiveness of operations.
Reliability of financial reporting.
Compliance with laws and regulations.
Each of the above is a primary objective of effective internal control.
Internal controls can never be considered as absolutely effective because
Controls always have inherent weaknesses that can be exploited.
Their effectiveness is limited by the competency and dependability of employees.
Controls are designed to prevent and detect only material misstatements.
None of the above.
Which of the following activities would be least likely to strengthen a company's internal control?
Separating accounting from other financial operations.
Fixing responsibility for the performance of employee duties. .
Maintaining insurance for fire and theft
Carefully selecting and training employees.
For an accounting system to be useful to the business, the accounting information it contains must be
accurate and up to date
approved by the chief executive officer
posted by an accountant
recorded using the accrual method
Which of the following is a requirement for a good accounting system:
It should be updated annually
It should provide needed information quickly
It should eliminate the need for an accountant
It should be replaced every two or three years
Two employees used a business’s computerized accounting system to change some records. They were able to steal $50,000 from the business because the accounting system lacked which of the following:
Protection from theft and fraud
An affordable price
A manual system as backup
Printed financial statements
Checks, receipts, invoices, and purchase orders are examples of
financial statements
department ledgers
source documents
accounting standards
Which of the following is a true statement:
Bookkeeping is the same as accounting
Bookkeeping does not use computers
Bookkeeping is limited to information on sales
Bookkeeping records business transactions
Which of the following presents the first three steps in the accounting cycle in the correct order:
Post, analyze, and journalize
Analyze, post, and journalize
Analyze, journalize, and post
Post, journalize, and analyze
Which of the following makes comparisons of the financial conditions at multiple organizations possible:
Bookkeeping
Source documents
Accounting standards
Trial balance
Which of the following categories of information are found on a balance sheet:
Income, expenditures, profit
Assets, liabilities, owner’s equity
Assets, liabilities, margin
Revenues, expenses, profit
What accounting record would summarize a business’s profit or loss for a previous year?
Bank statement
Inventory record
Income statement
Balance sheet
Which of the following financial reports provides estimates of when, where, and how much money will come into and out of a business next year:
Balance sheet
Cash flow statement
Income statement
Bank statement
Which TWO of the following statements about qualities of good information are true?
It should be relevant for its purposes
It should be communicated to the right person
It should be completely accurate
It should be provided whatever the cost
Which TWO of the following statements about management accounting information are true?
They may include non-financial information
They are required by law to be produced
They are used to aid planning
They are for use by parties external to the organisation
Good information should have certain qualities.
Which TWO of the following are required as qualities of good management information?
Complete
Extensive
True and fair
Accurate
Which of the following statements is correct?
Management accounting systems provide information for use in fulfilling legal requirements.
Management accounting systems provide information for the use of decision-makers within an organisation.
Management accounting systems provide information for use by shareholders.
Management accounting systems provide information for use by tax authorities.
Which TWO of the following would be data rather than information?
Sales increase/decrease per product in last quarter
Total sales value per product
Total material usage
Sales staff commission as a percentage of total sales
Information technology (IT) is the use of computers to______
sign the data or information
store, retrieve, transmit, and manipulate data or information
store, retrieve, look, and manipulate data or information
copy, store data
Important of Information technology is
Consistency, inaccurate, realibility, speed
speed, unconsistent, accurate, realibility
Consistency, accurate, realibility, speed
Consistency, inaccurate, realibility, slow
What is an internal control?
The internal control of a business involves the practices a business uses in the day to day operation such as inventory management, asset management, human resource management and cash management.
The internal control of a business involves the internal measures and methods that ensure efficient management of the business and achievement of planned objectives.
The internal control of a business involves the external measures and methods that ensure efficient management of the business and achievement of planned objectives.
The internal control of a business involves the internal measures and methods to ensure good business practices.
Which of the following is not an internal control over cash?
Separation of duties.
All cash received should be banked at the end of each business day.
Cash should be kept in a top draw in the manager’s office.
Rotation of duties.
Business records should be checked against a bank reconciliation.
Effective management of cash includes:
Ensuring appropriate controls are implemented.
Preparing cash budgets.
Investing excess cash to maximise revenue.
None of the above.
All of the above.
Internal controls over a Cash Payments system would have which of the following
Evidence
Proper authorisation
Regular bank reconciliation
Cheques or company credit card
All of the above
A properly designed internal control system:
Lowers the company's risk of loss
Ensures profitable operations
Eliminates the need for an audit
Requires the use of non-computerized systems
The impact of technology on internal controls includes:
Elimination of the need for regular audits
Elimination of fraud
Elimination of separation of duties
Reduced processing errors
Using source documents to initiate a transaction is an example of which internal control principle?
Establishment of responsibility
Segregation of duties
Documentation procedures
Physical controls
Which of the following is not a principle of internal control?
Segregation of duties
Physical controls
Documentation procedures
Self monitoring
Computer programs that limit unauthorized access to certain files is an example of:
Reliable personnel
Verification
Physical controls and security
Separation of duties
All of the following are examples of internal control procedures except:
Rotation of key personnel
Insistence that employees take vacations
Customer satisfaction surveys
Bank reconciliations
Which of the following attributes of internal control would be violated if the chief accounting clerk wrote cheques to pay accounts payable?
Separation of duties
Mandatory vacations
Periodic independent verification
Adequate design of documents
Which of the following is not a primary concern of internal control?
Safeguarding assets
Accuracy of accounting records
Efficiency of company operations
Employee information
