Policies and procedures that client management has established to meet its objectives for financial reporting include all of the following EXCEPT: Examine adequate segregation of duties in the accounting and finance department Ensure that the employees of the company's in the accounting and finance department are satisfied with their job Verify the adequacy of documents and records in the accounting and finance department Check for the proper authorization of transactions and activities

Policies and procedures that client management has established to meet its objectives for financial reporting include all of the following EXCEPT: Examine adequate segregation of duties in the accounting and finance department Ensure that the employees of the company's in the accounting and finance department are satisfied with their job Verify the adequacy of documents and records in the accounting and finance department Check for the proper authorization of transactions and activities

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter14: Completing A Quality Audit

Section: Chapter Questions

Problem 30RQSC

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Indicate whether each statement describes financial accounting or managerial accounting. The information is directed at external users who are making decisions pertaining to investing, extending credit, and other decisions. The principal users are the organizations managers. The key focus is on the entity as a whole. The rules and principles are very flexible. The information gathered is usually available after an independent audit has been completed.
The internal control system provides reasonable assurance that the company’s objectives are being met in all of the following areas EXCEPT which one? effectiveness and efficiency of the company’s operations reliability of financial reporting consolidation of departments within the accounting function compliance with applicable laws and regulations
Identify the following as True or False:A. Managerial accounting reports must comply with the rules set in place by the FASB.B. Financial accounting reports are typically general-purpose reports.C. Financial accounting reports pertain to the entity as a whole, whereas managerial accounting focusesmore on subunits of the organization.D. The main users of the financial accounting information are the internal users.E. Managerial reports are prepared on an as-needed basis.F. Financial accounting reports often must be audited at least annually by an independent auditor.
Match each of the following control activities with its definition. Control Activities Definitions 1. Separation of duties 2. Physical controls 3. Proper authorization 4. Employee management 5. Reconciliations 6. Performance reviews a. The company should maintain security over assets and accounting records.b. Management should periodically determine whether the amounts of physical assets of the company match the accounting records.c. The company should provide employees with appropriate guidance to ensure they have the knowledge necessary to carry out their job duties.d. The actual performance of individuals or processes should be checked against their expected performance.e. Authorizing transactions, recording transactions, and maintaining control of the related assets should be separated among employees.f. To prevent improper use of the company’s resources, only certain employees are allowed to carry out certain business activities.
_______ comprises of the plan of the organization and all the co-ordinate methods and measures adopted within a business to safeguard its assets, check the accuracy and reliability of its accounting data to promote operational efficiency and to encourage adherence to prescribed managerial policies. a. Internal Control b. Internal Audit c. Audit Plan d. Risk Assessment
Which control activity is the entity implementing when the system verifies that all payroll payments have a valid employee identification number as entered by the HR department Select one: O a. Adequate separation of duties b. Physical control over assets and records Oc. Proper authorization of transactions and activities O d. Adequate documents and records
Financial accounting follows Generally Accepted Acccounting Principles (GAAP), while managerial accounting Select one: O a. develops financial statements for external users O b. often has the financial information audited O c. is concerned with collecting data of historical nature O d. develops reports primarily prepared for internal use and help management make informed operational decisions.
Management reports: Multiple Choice Must follow a set of rules specified by Generally Accepted Accounting Principles Must follow the rules specified by the Internal Revenue Service Must follow the rules specified by vendors Do not have to follow a specified set of rules
1. Which of the following is not an internal user? a. Creditor b. Department manager c. Controller d. Treasurer 2. Internal reports are generally a. aggregated. b. detailed. c. regulated. d. unreliable. 3. The reporting standard for external financialreports isa. industry-specific.b. company-specific.c. generally accepted accounting principles.d. department-specific. 4. A distinguishing feature of managerial accountingisa. external users.b. general-purpose reports.c. very detailed reports.d. quarterly and annual reports. 5. The job cost sheet does not showa. costs chargeable to a specific job.b. the total costs of a completed job.c. the unit cost of a completed job.d. the cost of goods sold. 6. Which one of the following best describes a jobcost sheet? a. It is a form used to record the costs chargeableto a specific job and to determine the total and unit costs of the completedjob.b. It is used to track manufacturing overhead coststo specific jobs.c. It is used by management to…
When we work in any organization, we must be aware of issues that can lead to fraudulent behavior which can impact the financial reporting process in both managerial accounting and financial accounting reports. Distinguish between financial accounting and managerial accounting as to user groups and time horizons. Why should the chief accountant of an organization have a clear understanding of both financial and managerial accounting?
The objectivity standards of management accountants state that they must communicate information fairly and objectively. This means essentially that accountants must perform each task A as professionals, possessing the degree of skill of those management accountants who held the position before them. B so as to provide relevant information, both positive and negative, to the recipients of their reports. C to the satisfaction of government regulators. D in conformity with generally accepted accounting principles. ↓y
"Generally accepted accounting principles (GAAP) assist the development of management accounting systems." Do you agree? Explain. Question content area bottom Part 1 A. No. Although GAAP applies to internal accounting reports, managers rarely use it to develop management accounting systems. B. Yes. GAAP applies only to internal accounting reports. Therefore, managers must develop management accounting systems to comply with GAAP. C. No. GAAP applies to financial reporting for external users. Internal accounting reports are not restricted by GAAP. D. Yes. GAAP applies to internal accounting reports as well as financial reporting for external users. Managers must use GAAP in the development of all accounting systems.