Chapter 6

The concept of internal control includes IT systems and manual systems.

• True

• False

The auditor must understand internal control before assessing inherent risk

• True

• False

The extent of an entity's use of IT can affect internal control.

• True

• False

One of the risks associated with internal control from IT is potential loss of data.

• True

• False

Internal control consists of six components.

• False

• True

Internal control includes monitoring of controls.

• True

• False

A reliance strategy is used when control risk has been set at high.

• True

• False

A substantive strategy is used when control risk has been set at high.

• True

• False

Once a level of control risk has been established, it cannot be changed.

• True

• False

Tests of controls must be performed if control risk is set at a lower level.

• True

• False