Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
6 Cards in this Set
- Front
- Back
- 3rd side (hint)
|
What are the five components of internal control from COSO? |
Control environment Risk assessment Info and communication systems Monitoring Existing control activities |
CRIME |
|
|
Control activities include: |
Prenumbering of documents Authorization of transactions Independent checks to maintain asset accountability (checks and balances) Documentation Timely and appropriate performance reviews Information processing controls (general and application) Physical controls for safeguarding assets Segregation of duties (Authorization, record keeping, custody of related assets) |
PAIDTIPS |
|
|
The auditor should obtain an understanding of the five components of internal control sufficient to: |
1)Evaluate the design and implementation of relevant controls which include procedures such as inquiry, observation, inspection, walkthroughs 2)Assess the risks of material misstatement 3)Design the NET of further audit procedures |
Design... |
|
|
Documentation of understanding of internal control |
Flow charts, internal control questionnaire, narrative, documentation from client |
FIND |
|
|
Limitations on internal control |
Management override of internal control
Human error
Collusion |
Override... |
|
|
Service organization auditor reports |
Type I: design of controls which includes management's description of the service org system and written assertion by management (doesn't provide the user CPA with basis for reducing the assessment of control risk)
Type II: design AND operating effectiveness of controls which includes management's description of service org system, written assertion by management, auditor's opinion on management's assertion and description of service auditor's tests of controls (may provide evidence that would allow a reduction in the assessed level of control risk) |
Design... |
