Chapter 6

Question 1

a body guiding principles that form a template against which organizations can evaluate a multitude of business practices

Answer 1

framework

Question 2

1. control enviroment
2. risk assessment
3. control activities
4. information and commuication
5. monitoring

Answer 2

Components of internal control

Question 3

a process, effected by an entity’s board of directors, management, and other personal, designed to provide reasonable assurance and other personnel, designed to provide reasonable assurance regarding the achievement of objectives relating to operations, reporting, and compliance

Answer 3

internal control

Question 4

the three categories of objectives set forth in the COSO framework are:

Answer 4

-operations objectives
- reporting objectives
- compliance objectives

Question 5

pertain to effectiveness and effiencey of the entities operations

Answer 5

operations objectives

Question 6

pertain to internal and external financial and non financial reporting and may encompass reliability, timeliness, transparency, or other terms as set forth by regulators, standard setters, or the entity policies.

Answer 6

reporting objectives

Question 7

pertain to adherence to laws and regulations to which the entity is subject

Answer 7

compliance objectives

Question 8

control designed to reduce key risks associated with business objectives

Answer 8

key control

Question 9

control designed to either mitigate risks that are not key to business objectives or partially reduce the level of risk when a key control does not operate effectively

Answer 9

secondary control

Question 10

control designed to supplement a key control that is either ineffective or cannot fully mitigate a risk or group of risks by itself to an acceptable level

Answer 10

compensating control

Question 11

control designed to deter unintended events from occurring in the first place

Answer 11

preventive control

Question 12

control designed to discover undesirable events that have already occured

Answer 12

detective control

Question 13

control that apply to many if not all application systems and help ensure their continued proper operation

Answer 13

general control

Question 14

control that includes computerized steps within the application software and related manual procedures to control the processing of various types of transactions

Answer 14

application control