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13 Cards in this Set
- Front
- Back
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Internal Control
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Process designed to provide reasonable assurance regarding the achievmt. of mgmt's objs of: reliab. of fin. reporting; eff+eff of ops; abiding by laws
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Control Environment
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The actions, policies, and procedures that reflect the overall attitude of top mgmt., directors, and owners of an entity about IC + importance
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Risk Assessment
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Mgmt's ID and analysis of risks relevant to the preparation of financial statements in accordance w/GAAP
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Control Activities
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Policies and procedures, in addition to those included in the other four components of IC, that help ensure necess. actions are taken to asses. risk in objs
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Monitoring
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Management's ongoing and periodic assessment of the quality of IC performance to determine that controls are operating as intended + mod.
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Narrative
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A written description of a client's IC, including the origin, processing, and disposition of documents + records + relevant control proc.
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Flowchart
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A diagrammatic representation of the client's documents and records and the sequence in which they are processed
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Internal Control Questionnaire
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A series of questions about the controls in each audit area used as a means of indicating to the auditor aspects of IC that may be inadequate
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Assessment of Control Risk
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A measure of the auditor's expectations that IC will neither prevent mat. mist. from occurring nor detect+correct them if ocrd.
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Control Risk Matrix
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A methodology used to help the auditor assess control risk by matching key IC + IC weaknesses w/trans.-related audit objectives
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Significant Deficiency
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An IC deficiency that could adversely affect the entity's ability to initiate, record, process, and report finan. data consistent w/mgmts. assert.of FS
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Material Weakness
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A sig. deficiency in IC that, by itself, or in combo. w/ other sig. defic; results in more than a remote likelihood that a material mistmt./FS w/not detct.
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Tests of Controls
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Audit procedures to test the operating effectiveness of controls in support of reduced assessed control risk
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