Exam (elaborations)
CMPC 312 QUIZ 1 QUESTIONS AND ANSWERS
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CMPC 312 QUIZ 1 QUESTIONS AND ANSWERS
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CMPC 312 QUIZ 1 QUESTIONS AND ANSWERSable to identify specific control structure policies and procedures that are in place and
are likely to prevent or detect material misstatement in specific FS assertions, and must
test whether those policies and procedures are designed and operating effectively -
ANSWER-Below the Maximum (Less than high) Control Risk Assessment
all the policies and procedures adopted by the management of an entity to assist in
achieving management's objective of ensuring, as far as practicable, the orderly and
efficient conduct of its business. ncluding adherence to management policies, the
safeguarding of assets, the prevention and detection of fraud and error, the accuracy
and completeness of the accounting records, and the timely preparation of reliable
financial information. - ANSWER-Internal Control System
consists of infrastructure, software, people, procedures, and data - ANSWER-
Information System
deal with the logical connection with the purpose of the audit procedure under the
assertion under consideration - ANSWER-Relevance
design to obtain evidence about the FS assertions - ANSWER-Audit Tests
Detect material misstatements at the assertion level - ANSWER-Substantive
Procedures
effective and efficient use of the entity's resources including performance and
profitability goals and safeguarding resources against loss - ANSWER-Operational
enable the auditor to form an opinion on the FS - ANSWER-Audit Evidence
entity's compliance with applicable laws and regulations - ANSWER-Compliance
evidence obtained directly by auditors is more reliable than that obtained indirectly or by
inference - ANSWER-Auditor
examination of supporting documents of transaction; from accounting records to the
source documents; tests the assertions of existence and occurrence - ANSWER-
Vouching
graphic illustration of the physical flow of information through the accounting system -
ANSWER-Flowcharts
high likelihood that significant misstatements exist in the FS because internal control is
inadequate and can not be relied upon - ANSWER-Maximum (High) Control Risk
Assessment
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