BEC - 1

Question 1

Under Dodd-Frank, what is the range of mandatory awards for whistleblowing.

Answer 1

Between 10% and 30% of sanctions imposed.

Question 2

How are the following used in the calculation of the internal rate of return of a proposed project (ignore income tax considerations):

Residual Sales Value (Include or Exclude)

Depreciation Expense (Include or Exclude)

Answer 2

Residual Sales Value: Include

The residual value of an asset at the end of a project is a cash flow, is discounted, and affects the present value of net cash flows; it should be included.

Depreciation Expense: Exclude

Depreciation expense is not a cash flow and does not affect cash flows when income taxes are ignored.

Question 3

Macro-environmental analysis is concerned with analysis of

_____________

Answer 3

The characteristics of a country or region.

Question 4

A company manufactures goods in Esland for sale to consumers in Woostland. Currently, the economy of Esland is booming and imports are rising rapidly.
Woostland is experiencing an economic recession and its imports are declining.
How will the Esland currency, $E, react with respect to the Woostland currency, $W?

Answer 4

The $E will decline with respect to the $W.

In a flexible or floating foreign currency exchange rate system, the equilibrium rate of exchange between currencies is determined by market supply of and demand for each currency. Because Esland’s import of goods is rising rapidly, Esland’s demand for foreign currencies, including Woostland currency, will increase.
Conversely, because Woostland’s imports are declining, there is a decreasing demand in Woostland for foreign currencies, including Esland’s currency.
As a consequence of Esland’s relative increased demand for Woostland’s currency, more units of Estland’s currency will be required to purchase each unit of Woostland currency. Since it takes more units of $E to purchase each unit of $W, the value of $E relative to $W declines.

Question 5

The coefficient of determination, r squared, in a multiple regression equation is the

Answer 5

Percentage of variation in the dependent variable explained by the variation in the independent variables.

Question 6

The requirements definition document is signed at this stage:

Answer 6

Analysis.

Question 7

The primary themes associated with the Attribute Standards are:

Answer 7

(1) Purpose, Authority, and Responsibility
(2) Independence and Objectivity
(3) Proficiency and Due Professional Care
(4) Quality Assurance and Improvement Program. “Managing the Internal Audit Activity” is associated with the Performance Standards, not the Attribute Standards.

Question 8

Change Identification (COSO)

Answer 8

The monitoring for change process that would include ongoing and separate evaluations intended to identify and address changes in internal control effectivenes

Question 9

Change Management (COSO)

Answer 9

This stage of the monitoring for change process is concerned with, when changes occur, verifying that controls remain effective despite identified changes in controls and/or risks.

Question 10

AR Turnover

Answer 10

Credit Sales / Average AR