2024 AIS EXAM 1 QUESTIONS & ANSWERS 100% CORRECT
What are the 5 Elements of the COSO Framework - ANSWERS1) Control enviornment
2) Risk Management
3) Control Activities
4) Information & communication
5) Monitorning
Control Environment - ANSWERSTone at the Top
Integrity and ethical value...
What are the 5 Elements of the COSO Framework - ANSWERS1) Control enviornment
2) Risk Management
3) Control Activities
4) Information & communication
5) Monitorning
Control Environment - ANSWERSTone at the Top
Integrity and ethical values
Board demonstrates independance from managers
develop and train competent people
includes the boundaries of acceptable behavior, importance of internal controls, and the overall culture
of the company
Risk Management - ANSWERSOrganization identifies potential for fraud
Identifies risk to internal controls
Opportunity, Rationalization, Pressure
Control activities - ANSWERSControl activities that contribute to the mitigation of risks:
Policies & Procedures: Can be- Preventative, Detective, or Corrective
Information & Comunication - ANSWERSCompany obtains or generates relevant, quality information
for the business to run effectively
What Is a business Process? - ANSWERSAn activity, or set of activities that accomplish a specific
organizational goal.
, Sales, Purchasing, payroll. Etc.
Why do we Care? - ANSWERSBecause they end up on our financial statements.
Sales= REVENUES
Purchases= Expenses,assets, liabilities
payroll= expenses, Liabilities
What types of posts are likely to be exaggerated? - ANSWERSSales, Revenues
What types of post are likely to be played down? - ANSWERSexpenses, liabilities. etc...
Managements assertions about transactions & events - ANSWERSOccurrence
Completeness
Authorization
Accuracy
Cuttoff
Classification
Occurance - ANSWERSAll transactions that have been recorded have occurred and pertain to the entity
ANYTHING a Manager might want to OVERSTATE to make financials look better.
SALES = High Occurance
Completeness - ANSWERSAll transactions that SHOULD have been recorded have been recorded.
More concerned with Understatements
Authorization - ANSWERSAll transactions and events have been properly authorized.
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