Kaplan - BT Mock 6 (chap 16-18)

In Internal control,ensuring that a single task is not executed by one person completely, but also is checked by another

• Division of authority
• Internal check
• Teamwork
• Shared responsibility

A company's internal controls can be so well designed that they eliminate risk of failing to achieve company's objective

• True
• False

The purpose of internal control does not include

• safeguarding assets
• detection of fraud and error
• timely preparation of reliable financial statements
• none of the above

Components of internal control as per the COSO framework does not include

• Secured data interchange
• Control environment
• Control activities
• Risk assessment process

The possibility of an event happening that could adverselt affect the company from achieving it's objectives is known as

• Business risk
• FInancial system risk
• Uncertainty
• Macro environment negativity

The internal control of having security officers at the entrance and exit of a bank relates to

• Authorization
• Physical control
• Segregation of duties
• Comparison

Splitting a transaction to three elements namely authorization, recording and maintaining custody of assets is

• Authorization
• Computer controls
• Segregation of duties
• Comparison

Checking for calculation and computational errors in books is related to

• Comparison
• Computer controls
• Arithmetical controls
• None of the above

Types of internal controls does not include

• Preventive controls
• Monitoring controls
• Detective controls
• Corrective controls

Internal audit is a necessary cost that must be incurred by a company and offers few tangible benefits for the company

• True
• False