Internal Control-required communications

Question 1

significant deficiency

Answer 1

a deficiency (or combinations of deficiency) in internal control that is less severe than a material weakness, yet important enough to merit attention.

Question 2

material weakness

Answer 2

a deficiency (or combination of deficiencies) in internal control where there is a reasonable possibility that a material misstatement will not be prevented or detected and corrected on a timely basis.

Question 3

basic responsibility

Answer 3

auditor must identify any significant deficiency or material weakness in the design or operation of internal control. need to determine if its a significant deficiency or a material weakness

Question 4

identified significant deficiency and material weakness must be

Answer 4

communicated in writing to management or those charged with governance (even those things discussed verbally)

Question 5

lesser matters

Answer 5

those that are not sig def, or mat weakness, may be communicated verbally or in writing. need to document verbal communications occurred

Question 6

timing of communication

Answer 6

must be communicated no later than 60 days from the release date

Question 7

restricted distribution

Answer 7

the auditor should restrict the distribution of any such report to specified users