Terms Flashcards
Issuer
Publicly traded company
Non-issuer
Private company
Five components of internal control
Control Environment Risk Assessment Information and Communication Systems Monitoring Existing Control Activities
Types of service organization reports
SOC 1 - company’s internal control
SOC 2 - examination of controls
Type 1 - design of controls
Type 2 - operating effectiveness
Transaction Tagging
electronically marks a transaction and allows the auditor to follow it through the client’s system.
Embedded Audit Modules
an application program collects transaction data for the auditor. The auditor must be involved with the program design.
Test Deck (Test Data)
Uses application program to process test data, the results of which are already known (client system, offline).
Integrated Test Facility (ITF)
Test data is commingled with live data (client system, auditor’s data, online).
Parallel Simulation (Reperformance Test)
The auditor reprocesses some or all of the client’s live data and compares the results with client files (auditor’s system, client data).
Generalized Audit Software Packages (GASP)
Allow the auditor to perform tests of controls and substantive test directly on the client’s system.
Error
Unintentional
Fraud
Intentional
Pressure, Opportunity, and Rationalization
Positive Confirmation
A confirmation in which the recipient is requested to be respond regardless of whether the information included (if any) is accurate.
FOB Destination
Goods are included in buyer’s inventory upon receipt.
FOB Shipping Point
Goods are included in buyer’s inventory upon shipment.
