Which of the following best describes an entitys

9) Which of the following best describes an entity's accounting information and communication
system?
A)
B)
C)
D)
Answer: D
Terms: Accounting information and communication system
Diff: Moderate
Objective: LO 10-3
AACSB: Reflective thinking skills
Monitor
transactions
Record and
process
transactions Initiate transactions
Yes Yes Yes
Monitor
transactions
Record and
process
transactions Initiate transactions
No No No
Monitor
transactions
Record and
process
transactions Initiate transactions
Yes No No
Monitor
transactions
Record and
process
transactions Initiate transactions
No Yes Yes
13

10) An audit procedure that would most likely be used by an auditor in performing tests of
control procedures in which the segregation of functions and that leaves no "audit" trail is:
11) Internal controls normally include procedures designed to provide reasonable assurance that:
12) Which of the following is not one of the subcomponents of the control environment?
13) It is important for the CPA to consider the competence of the clients' personnel because their
competence has a direct impact upon the:
A) cost/benefit relationship of the system of internal control.
B) achievement of the objectives of internal control.
C) comparison of recorded accountability with assets.
D) timing of the tests to be performed.
Answer: B
Terms: Competence of client personnel
Diff: Moderate
Objective: LO 10-3
AACSB: Reflective thinking skills
14

14) Proper segregation of functional responsibilities calls for separation of: