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An Entity's Internal Controls Consist of Five Interrelated Components (Plus

Question 91

Matching

An entity's internal controls consist of five interrelated components (plus an overriding concern with fraud prevention and detection), identify the component to which each of the following control activities or considerations pertains.

Premises:
Performance reviews
Commitment to competence
System should provide a complete audit or transaction trail
Integrity and ethical values
Access controls
Changes in operating environment
Board of directors and audit committee
Segregation of duties
Organizational structure
Reporting exceptions for follow-up
Management’s philosophy and operating style
Internal audit function
Physical controls
New accounting pronouncements
Assignment of authority and responsibility
Human resource policies and procedures
Organization and operation control
Input controls
Data and procedural controls
Processing controls
Responses:
control environment
risk assessment
information and communication
control activities
monitoring

Correct Answer:

Performance reviews
Commitment to competence
System should provide a complete audit or transaction trail
Integrity and ethical values
Access controls
Changes in operating environment
Board of directors and audit committee
Segregation of duties
Organizational structure
Reporting exceptions for follow-up
Management’s philosophy and operating style
Internal audit function
Physical controls
New accounting pronouncements
Assignment of authority and responsibility
Human resource policies and procedures
Organization and operation control
Input controls
Data and procedural controls
Processing controls
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