1. Why is a system of internal control not able to overcome collusion by employees?
2. In what way does internal control contribute to faithful representation in its financial statements?
3. Which of the following accounts would be assigned a higher level of risk: Building or Merchandising Inventory?
4. Why is it important to record the amount of cash received through the mail or over the counter?
5. What role does a bank reconciliation play in internal control over cash?
6. Name some businesses whose needs for cash fluctuate during the year. Name some whose needs for cash are relatively stable over the year.
7. Why is it important for public companies to have an audit of management's assessment of internal control?