18 Questions
What is one of the primary functions of an independent audit committee?
Serving as a sounding board for employees
What is a common factor contributing to corporate frauds?
Lack of independence of audit committee members
What is the primary purpose of an auditor's report?
To express an opinion on the reliability of financial statements
What guides auditors in their professional responsibility?
GAAS
What is the primary benefit of an independent audit committee?
Improved corporate governance
What are the three classes of auditing standards?
General qualification, field work, and reporting
What is the primary focus of SAS 109?
Obtaining sufficient knowledge of the organization's risk assessment procedures
What is a potential risk to business operations and transaction processing?
Organizational restructuring
What is the primary purpose of an effective accounting information system?
To identify and record all valid financial transactions
What is a key aspect of an accounting information system?
Transaction processing and financial reporting
What is a risk associated with entering into foreign markets?
Fluctuations in foreign currency exchange rates
What is a key component of an organization's risk assessment procedures?
Identifying and prioritizing risks related to financial reporting
What is the primary objective of Sections 302 and 404 of SOX?
To assign responsibilities to management for internal control
What is the recommended model for control assessment mentioned in the PCAOB Auditing Standard No. 5?
COSO
What is one of the procedures external auditors must perform quarterly according to Section 302?
Interview management regarding changes in internal control
What is one of the broad objectives of an organization's internal control system?
To safeguard assets of the firm
What is the role of the independent audit committee in relation to internal control?
To evaluate the effectiveness of internal control
What is the primary focus of the COSO framework?
Internal control and risk assessment
Learn about the importance of an effective audit committee in preventing corporate fraud, common failures that lead to fraud, and the role of audit committee members in asset protection. Test your knowledge on audit committee best practices and fraud prevention strategies.
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