Complete the mcq:
1. An element of internal control is
risk assessment.
journals.
subsidiary ledgers.
controlling accounts.
2. The amount of deposits in transit is included on the bank statement as a(n)
deduction from the balance per the depositor's books.
deduction from the balance per bank statement.
addition to the balance per bank statement.
addition to the balance per depositor books.
3. The purpose of the Sarbanes-Oxley Act of 2002 is
to restore public confidence and trust in the financial statements of publicly held companies.
require all companies to prepare financial statements.
protect companies from demands of investors, stockholders, and creditors.
do all of these.
4. The objectives of internal control are
to control the internal organization of the accounting department personnel and equipment.
provide reasonable assurance that assets are safeguarded, information is processed accurately, and laws and regulations are complied with.
prevent fraud and promote the social interest of the company.
provide control over Af?cAc‚¬A??ointernal-use onlyAf?cAc‚¬ reports and employee internal conduct.
5. The framework that has become widely accepted as the standard by which companies design, analyze, and evaluate internal controls is the
Internal Control Integrated Framework by the Committee of Sponsoring Organizations.
Internal Control Integrated Framework by the Congress of Special Offering.
Internal Control Integrated Framework Commission of Organizations.
Internal Control Localized Structure by the Congress of Special Offerings.
6. The bank reconciliation should be prepared
by an employee who records cash transactions.
is part of the internal control system.
is for information purposes only.
is sent to the bank for verification.
7. The Sarbanes-Oxley Act of 2002 requires companies and their independent accountants to
report on the financial activities of the company.
report on any fraud and theft detected in the company.
report on the state of the economy and likelihood of fraud.
report on the effectiveness of the company's internal controls.
8. Which of the following elements of internal control focuses upon locating weaknesses and improving control effectiveness?
The control environment
Risk assessment
Control procedures
Monitoring
9. Separating the custody of assets from accounting for assets is a part of which element of internal control?
Information and communication
Monitoring
Control procedures
The control environment
10. Requiring employees to take annual vacations is part of which element of internal control?
The control environment
Risk assessment
Control procedures
Monitoring