ACC 576 Enhance teaching - tutorialrank.com

1. ACC 576 Final Exam Guide For more course tutorials visit www.tutorialrank.com ACC 576 Final Exam Study Question 1 (IFTC-0112) Controls in the information technology area are classified into the preventive, detective, and corrective categories. Which of the following is a preventive control? Question 2 (IFTC-0082) An organization relied heavily on e-commerce for its transactions. Evidence of the organization’s security awareness manual would be an example of which of the following types of controls? Question 3 (IFTC-0067) Which of the following types of control plans is particular to a specific process or subsystem, rather than related to the timing of its occurrence? Question 4 (CGIC-0032) Which of the following is true about the Sarbanes-Oxley requirements regarding the audit committee financial expert? Question 5 (CGIC-0026)

2. Which of the following is not a component of COSO’s enterprise risk management framework? Question 6 (CGIC-0010) Which of the following is not required by the Sarbanes-Oxley Act of 2002? Question 7 (CGIC-0025) Which of the following is not an advantage of the employment of an enterprise risk management (ERM) system? Question 8 (CGIC-0008) A financial statement audit performed under the requirements of the Sarbanes-Oxley Act of 2002 must include an examination and report upon Question 9 (CGIC-0024) An important benefit of an enterprise risk management system is Question 10 (CGIC-0023) Which of the following bodies has developed a framework for enterprise risk management? Question 11 (CGIC-0005) Which of the following executives of an issuer corporation must certify to the accuracy and truthfulness of financial reports filed with the SEC? Question 12 (CGIC-0004)

3. Which of the following is not a responsibility that should be assigned to the audit committee of the board of directors? Question 13 (CGIC-0018) Which of the following components of internal control are characterized by ongoing activities and separate evaluations? Question 14 (CGIC-0003) Which of the following can be the most effective monitoring device for effective corporate governance? Question 15 (CGIC-0002) From a corporate governance standpoint which of the following best describes the main goal of a form of executive compensation? Question 16 (CGIC-0019) Which of the following components of internal control encompass policies and procedures that ensure that management’s directives are carried out? Question 17 (CGIC-0001) Which of the following forms of compensation is more likely to result in shirking by management? Question 18 (CGIC-0036) In the COSO framework, individuals within the company that monitor internal controls are referred to as Question 19 (CGIC-0016)

4. The COSO definition of internal control considers control activities a(n): Question 20 (CGIC-0021) If internal control is properly designed, the same employee should not be permitted to Question 1 (ECON-0036) If a government were to use only fiscal policy to stimulate the economy from a recession, it would Question 2 (ECON-0056) Disposable income is calculated as Question 3 (ECON-0003) Which of the following changes would create pressure for the Japanese yen to appreciate relative to the U.S. dollar? Question 4 (ECON-0021) If a group of consumers decide to boycott a particular product, the expected result would be Question 5 (ECON-0020) The movement along the demand curve from one price-quantity combination to another is called a(n) Question 6 (ECON-0030) In the long run, a firm may experience increasing returns due to Question 7 (ECON-0017)

5. Which of the following is not accurate about product differentiation? Question 8 (ECON-0063) Which of the following segments of the economy will be least affected by the business cycle? Question 9 (ECON-0069) What is the effect when a foreign competitor’s currency becomes weaker compared to the U.S. dollar? Question 10 (ECON-0046) Some economic indicators lead the economy into a recovery or recession, and some lag it. An example of a lag variable would be Question 11 (ECON-0002) If the U.S. dollar declines in value relative to the currencies of many of its trading partners, the likely result is that Question 12 (ECON-0055) The rate of unemployment caused by changes in the composition of employment opportunities over time is referred to as the Question 13 (ECON-0060) To address the problem of a recession, the Federal Reserve Bank most likely would take which of the following actions? Question 14 (ECON-0040) Which of the following is a direct effect of imposing a protective tariff on an imported product?

6. Question 15 (ECON-0077) What does the consumer price index measure? Question 16 (ECON-0037) The discount rate of the Federal Reserve System is Question 17 (ECON-0073) Which of the following individuals would be most hurt by an unanticipated increase in inflation? Question 1 (FINM-0082) Which of the following statements is correct regarding the weighted- average cost of capital (WACC)? Question 2 (FINM-0066) The benefits of debt financing over equity financing are likely to be highest in which of the following situations? Question 3 (RMCB-0027) Which of the following describes an option? Question 4 (FINM-0034) A company has $1,500,000 of outstanding debt and $1,000,000 of outstanding common equity. Management plans to maintain the same proportions of financing from each source if additional projects are undertaken. If the company expects to have $60,000 of retained earnings available for reinvestment in new projects in the coming year, what dollar amount of new investments can be undertaken without issuing new equity?

7. Value of equity Value of debt + Value of equity Since the question states that the firm will maintain the same weight of each financing source, each dollar invested is composed of 40 cents of equity and 60 cents of debt. The first $60,000 of equity used in financing new projects is sourced from retained earnings. This source of equity is exhausted when the firm reaches an investment level of $60,000 / .4 = $150,000.When the level of investment exceeds this amount, equity financing must be raised externally. Question 5 (FINM-0024) DQZ Telecom is considering a project for the coming year that will cost $50,000,000. DQZ plans to use the following combination of debt and equity to finance the investment: Question 6 (RMCB-0026) Which of the following describes a normal yield curve? Question 7 (FINM-0073) Which of the following types of bonds is most likely to maintain a constant market value? Question 8 (RMCB-0058) Which of the following is an advantage of net present value modeling? Question 9 (RMCB-0057) The calculation of depreciation is used in the determination of the net present value of an investment for which of the following reasons?

8. Question 10 (RMCB-0051) Net present value as used in investment decision-making is stated in terms of which of the following options? Question 11 (RMCB-0020) Essex Corporation is evaluating a lease that takes effect on March 1, 2012. The company must make eight equal payments, with the first payment due on March 1, 2012. The concept most relevant to the evaluation of the lease is Question 12 (RMCB-0043) On January 1, 2012, Colt Company issued 10-year bonds with a face amount of $1,000,000 and a stated interest rate of 8% payable annually on January 1. The bonds were priced to yield 10%. Present value factors are as follows: Present value of 1 for 10 periods Present value of an ordinary annuity of 1 for 10 periods The total issue price (rounded) of the bonds was Question 13 (FINM-0001) Net working capital is the difference between Question 14 (RMCB-0041) Assume that management of Trayco has generated the following data about an investment project that has a five-year life: Initial investment

9. Additional investment in working capital Cash flows before income taxes for years 1 through 5 Yearly depreciation for tax purposes Terminal value of machine Cost of capital Present value of $1 received after 5 years discounted at 8% Present value of an ordinary annuity of $1 for 5 years at 8% Assume that Trayco's marginal tax rate is 30% and all cash flows come at the end of the year. Calculate the net present value of the investment of the project. Question 15 (FINM-0014) Which one of the following statements correctly compares bond financing alternatives? Question 16 (RMCB-0056) A client wants to know how many years it will take before the accumulated cash flows from an investment exceed the initial investment, without taking the time value of money into account. Which of the following financial models should be used? Question 17 (RMCB-0049) Harvey Co. is evaluating a capital investment proposal for a new machine. The investment proposal shows the following information: Initial cost

10. Life Annual net cash inflows Salvage value If acquired, the machine will be depreciated using the straight-line method. The payback period for this investment is Question 18 (RMCB-0054) Which of the following statements is correct regarding financial decision making? Question 19 (RMCB-0052) Which of the following formulas should be used to calculate the economic rate of return on common stock? Question 20 (FINM-0054) All of the following are features of just-in-time (JIT) systems except Question 1 (IFTC-0054) Because log-on procedures may be cumbersome and tedious, users often store log-on sequences in their personal computers and invoke them when they want to use mainframe facilities. A risk of this practice is that Question 2 (IFTC-0035) Employee numbers have all numeric characters. To prevent the input of alphabetic characters, what technique should be used? Question 3 (IFTC-0051)

11. An organization's computer help desk function is usually a responsibility of the Question 4 (IFTC-0022) First Federal S&L has an online real-time system, with terminals installed in all of its branches. This system will not accept a customer's cash withdrawal instructions in excess of $1,000 without the use of a "terminal audit key." After the transaction is authorized by a supervisor, the bank teller then processes the transaction with the audit key. This control can be strengthened by Question 5 (IFTC-0043) A brokerage firm has changed a program so as to permit higher transaction volumes. After proper testing of the change, the revised programs were authorized and copied to the production library. This practice is an example of Question 6 (IFTC-0023) In a daily computer run to update checking account balances and print out basic details on any customer's account that was overdrawn, the overdrawn account of the computer programmer was never printed. Which of the following control procedures would have been most effective in detecting this fraud? Question 7 (IFTC-0088) In which of the following locations should a copy of the accounting system data backup of year-end information be stored? Question 8 (IFTC-0018) A computer input control is designed to ensure that

12. Question 9 (IFTC-0002) Which of the following would lessen internal control in a computer processing system? Question 10 (IFTC-0103) A value-added network (VAN) is a privately owned network that performs which of the following functions? Question 11 (IFTC-0102) Which of the following is usually a benefit of using electronic funds transfer for international cash transactions? Question 12 (IFTC-0030) The machine language for a specific computer Question 13 (IFTC-0049) Securing client/server systems is a complex task because of all of the following factors except: Question 14 (IFTC-0028) A data warehouse in an example of Question 15 (IFTC-0078) Compared to batch processing, real-time processing has which of the following advantages? Question 16 (IFTC-0032)

13. Which of the following is not a characteristic of a batch processed computer system? Question 17 (IFTC-0072) Which of the following is an advantage of a computer-based system for transaction processing over a manual system? A computer-based system Question 18 (IFTC-0131) When a client's accounts payable computer system was relocated, the administrator provided support through a dial-up connection to a server. Subsequently, the administrator left the company. No changes were made to the accounts payable system at that time. Which of the following situations represents the greatest security risk? Question 19 (IFTC-0114) In a large multinational organization, which of the following job responsibilities should be assigned to the network administrator? Question 20 (IFTC-0055) Today organizations are using microcomputers for data presentation because microcomputer use, compared to mainframe use, is more Question 1 (COST-0056) The following is selected information from the records of Ray, Inc.: Purchases of raw materials Raw materials, beginning Raw materials, ending

14. Work-in-process, beginning Work-in-process, ending Cost of goods sold Finished goods, beginning Finished goods, ending What is the total amount of conversion costs? Question 2 (PLAN-0049) A defense contractor for a government space project has incurred $2,500,000 in actual design costs to date for a guidance system whose total budgeted design cost is $3,000,000. If the design phase of the project is 60% complete, what is the amount of the contractor's current overrun/savings on this design work? Question 3 (COST-0044) A company with three products classifies its costs as belonging to five functions: design, production, marketing, distribution, and customer services. For pricing purposes, all company costs are assigned to the three products. The direct costs of each of the five functions are traced directly to the three products. The indirect costs of each of the five business functions are collected into five separate cost pools and then assigned to the three products using appropriate allocation bases. The allocation base that would most likely be the best for allocating the indirect costs of the distribution function is Question 4 (COST-0051) Which of the following is assigned to goods that were either purchased or manufactured for resale?

15. Question 5 (PLAN-0045) A company manufactures a product that has the direct material standard cost presented below. Budgeted and actual information for the current month for the manufacture of the finished product and the purchase and use of the direct material are also presented.Standard cost for direct material1.60 lb. @ $2.50 per lb. = $4.00 Finished goods (in units) Direct material usage (in pounds) Direct material purchases (in pounds) Total cost of direct material purchases The direct material price variance for the current month is Question 6 (PLAN-0041) A favorable material price variance coupled with an unfavorable material usage variance would most likely result from Question 7 (PERM-0001) A strategy map in the balanced scorecard framework is Question 8 (PLAN-0035) Comparing actual results with a budget based on achieved volume is possible with the use of a Question 9 (PLAN-0032)

16. The cash receipts budget includes Question 10 (COST-0043) A company is attempting to determine if there is a cause and effect relationship between scrap value and output produced. The following exhibit presents the company's scrap data for the last fiscal year: Scrap Value as a Percent of Standard Dollar Value of Output Produced Month Nov. 11 Dec. 11 Jan. 12 Feb. 12 Mar. 12 Apr. 12 May-12 Jun. 12 Jul. 12 Aug. 12 Sep. 12 Oct. 12

17. Based on the above data, the company's scrap value in relation to the standard dollar value of output produced appears to be Question 11 (PLAN-0013) In preparing its cash budget for July 2012, Reed Company made the following projections: Sales Gross profit (based on sales) Decrease in inventories Decrease in accounts payable for inventories For July 2012 what were the estimated cash disbursements for inventories? Question 12 (PERM-0022) The following selected data is for the Consumer Products Division of Gerriod Corp. Sales Average invested capital (total assets) Net operating profit Cost of capital Calculate the spread between the return on investment and the required rate of return for the Consumer Products Division. Question 13 (RMCB-0001)

18. A company is considering exchanging an old asset for a new asset. Ignoring income tax considerations, which of the following is economically relevant to the decision? Question 14 (PLAN-0105) Carter Co. paid $1,000,000 for land three years ago. Carter estimates it can sell the land for $1,200,000, net of selling costs. If the land is not sold, Carter plans to develop the land at a cost of $1,500,000. Carter estimates net cash flow from the development in the first year of operations would be $500,000. What is Carter's opportunity cost of the development? Question 15 (PERM-0012) In the cost of quality, liability claims are examples of Question 16 (PERM-0019) The following selected data is for the Consumer Products Division of Gerriod Corp. Sales Average invested capital (total assets) Net operating profit Cost of capital Calculate the asset turnover ratio for the Consumer Products Division. Question 17 (PLAN-0106) A company that produces 10,000 units has fixed costs of $300,000, variable costs of $50 per unit, and a sales price of $85 per unit. After

19. learning that its variable costs will increase by 20%, the company is considering an increase in production to 12,000 units. Which of the following statements is correct regarding the company's next steps? Question 18 (PLAN-0087) Which of the following listings correctly describes the order in which the four types of budgets must be prepared? Question 19 (PLAN-0048) All else being equal, the breakeven point in units will be higher if Question 20 (PLAN-0091) Relevant information for material A follows: Quantity purchased Standard quantity allowed Actual price Standard price What was the direct material price variance for material A? ============================================== ACC 576 Week 1 Quiz (All Possible Questions) For more course tutorials visit

20. www.tutorialrank.com This Tutorial contains More than 150 Question Test Bank (we have listed some of the Questions below) Week 1 Quiz Question 1 The first general standard requires that an audit of financial statements is to be performed by a person or persons having Question 2 Which of the following standards requires a critical review of the work done and the judgment exercised by those assisting in an audit at every level of supervision? Question 3 An auditor uses the knowledge provided by the understanding of the internal control structure and the final assessed level of control risk primarily to determine the nature, timing, and extent of the Question 4 An auditor's primary consideration regarding an entity's internal control structure policies and procedures is whether the policies and procedures Question 5

21. To obtain evidential matter about control risk, an auditor selects tests from a variety of techniques including Question 6 Prior to commencing fieldwork, an auditor usually discusses the general audit strategy with the client's management. Which of the following matters does the auditor and management agree upon at this time? Question 7 Which of the following factors most likely would cause a CPA to decline to accept a new audit engagement? Question 8 Which of the following factors would least influence an auditor's consideration of the reliability of data for purposes of analytical procedures? Question 9 A previously communicated significant deficiency ordinarily should be communicated again if Question 10 Which of the following statements concerning analytical procedures is correct? Question 11 Which of the following is the authoritative body designated to promulgate attestation standards? Question 12

22. As the acceptable level of detection risk decreases, an auditor may change the Question 13 A CPA in public practice must be independent in fact and appearance when providing which of the following services? Question 14 The primary objective of procedures performed to obtain an understanding of the internal control structure is to provide an auditor with Question 15 Which of the following statements is correct concerning an auditor's required communication of significant deficiencies? Question 16 Which of the following procedures would an auditor most likely perform in planning a financial statement audit? Question 17 When an auditor increases the planned assessed level of control risk because certain control procedures were determined to be ineffective, the auditor would most likely increase the Question 18 An auditor concludes that a client has committed an illegal act that has not been properly accounted for or disclosed. The auditor should withdraw from the engagement if the

23. Question 19 In performing an attestation engagement, a CPA typically Question 20 Which of the following characteristics most likely would heighten an auditor's concern about the risk of material misstatement arising from fraudulent financial reporting? ============================================== ACC 576 Week 2 Quiz (All Possible Questions) For more course tutorials visit www.tutorialrank.com This Tutorial contains More than 150 Question Test Bank (we have listed some of the Questions below) Week 2 Quiz Question 1

24. The most likely result of ineffective internal control policies and procedures in the revenue cycle is that Question 2 An entity with a large volume of customer remittances by mail could most likely reduce the risk of employee misappropriation of cash by using Question 3 Which of the following statements is generally correct about the reliability ofaudit evidence? Question 4 Which of the following audit procedures would an auditor most likely perform to test controls relating to management's assertion concerning the completeness of sales transactions? Question 5 The audit working paper that reflects the major components of an amount reported in the financial statements is the Question 6 Which of the following most likely would indicate the existence of related parties? Question 7 Which of the following procedures would an auditor most likely perform during an audit engagement's overall review stage in formulating an opinion on an entity's financial statements?

25. Question 8 In auditing accounts receivable the negative form of confirmation request most likely would be used when Question 9 Before applying substantive tests to the details of asset accounts at an interim date, an auditor should assess: Question 10 "There have been no communications from regulatory agencies concerning noncompliance with, or deficiencies in, financial reporting practices that could have a material effect on the financial statements." The foregoing passage is most likely from a Question 11 "We have disclosed to you all known instances of noncompliance or suspected noncompliance with laws and regulations whose effects should be considered when preparing financial statements." The foregoing passage most likely is from a(n) Question 12 Which of the following controls would be most effective in assuring that recorded purchases are free of material errors? Question 13 An auditor should request that an audit client send a letter of inquiry to those attorneys who have been consulted concerning litigation, claims, or assessments. The primary reason for this request is to provide Question 14

26. To which of the following matters would materiality limits not apply in obtaining written management representations? Question 15 In which of the following circumstances is substantive testing of accounts receivable before the balance sheet date most appropriate? Question 16 The purpose of segregating the duties of hiring personnel and distributing payroll checks is to separate the Question 17 An auditor's purpose in reviewing credit ratings of customers with delinquent accounts receivable most likely is to obtain evidence concerning management's assertions about Question 18 The objective of tests of details of transactions performed as substantive tests is to Question 19 Which of the following documentation is not required for an audit in accordance with generally accepted auditing standards? Question 20 An auditor should design the written audit program so that ==============================================

27. ACC 576 Week 3 Quiz For more course tutorials visit www.tutorialrank.com This Tutorial contains More than 150 Question Test Bank (we have listed some of the Questions below) Week 3 Quiz Question 1 In designing written audit programs, an auditor should establish specific audit objectives that relate primarily to the Question 2 Which of the following procedures is least likely to be performed before the balance sheet date? Question 3 In determining whether transactions have been recorded, the direction of the audit testing should be from the Question 4

28. Which of the following combination of procedures would an auditor most likely perform to obtain evidence about fixed asset additions? Question 5 An auditor may achieve audit objectives related to particular assertions by Question 6 The sampling unit in a test of controls pertaining to the existence of payroll transactions ordinarily is a(an) Question 7 The risk of incorrect acceptance and the likelihood of assessing control risk too low relate to the Question 8 Which of the following audit procedures probably would provide the most reliable evidence concerning the entity's assertion of rights and obligations related to inventories? Question 9 When an auditor tests a computerized accounting system, which of the following is true of the test data approach? Question 10 An auditor is determining the sample size for an inventory observation using mean-per-unit estimation, which is a variables sampling plan. To calculate the required sample size, the auditor usually determines the Question 11

29. Processing data through the use of simulated files provides an auditor with information about the operating effectiveness of control policies and procedures. One of the techniques involved in this approach makes use of Question 12 An auditor should trace bank transfers for the last part of the audit period and first part of the subsequent period to detect whether Question 13 The primary responsibility of a bank acting as registrar of capital stock is to Question 14 An auditor most likely would perform substantive tests of details on payroll transactions and balances when Question 15 Cutoff tests designed to detect credit sales made before the end of the year that have been recorded in the subsequent year provide assurance about management's assertion of Question 16 In performing tests of controls over authorization of cash disbursements, which of the following sampling methods would be most appropriate? Question 17

30. In evaluating the adequacy of the allowance for doubtful accounts, an auditor most likely reviews the entity's aging of receivables to support management's financial statement assertion of Question 18 Which of the following courses of action would an auditor most likely follow in planning a sample of cash disbursements if the auditor is aware of several unusually large cash disbursements? Question 19 Which of the following characteristics most likely would be an advantage of using classical variables sampling rather than probability- proportional-to-size (PPS) sampling? Question 20 Which of the following statements is correct concerning statistical sampling in tests of controls? ============================================== ACC 576 Week 4 Quiz (All Possible Questions) For more course tutorials visit www.tutorialrank.com

31. This Tutorial contains More than 150 Question Test Bank (we have listed some of the Questions below) Week 4 Quiz Question 1 Comfort letters ordinarily are addressed to Question 2 When compiling a nonpublic entity's financial statements, an accountant would be least likely to Question 3 Comfort letters ordinarily are signed by the entity's Question 4 Which of the following matters is covered in a typical comfort letter? Question 5 Green, CPA, was engaged to audit the financial statements of Essex Co. after its fiscal year had ended. The timing of Green's appointment as auditor and the start of field work made confirmation of accounts receivable by direct communication with the debtors ineffective. However, Green applied other procedures and was satisfied as to the reasonableness of the account balances. Green's auditor's report most likely contained a(an)

32. Question 6 When engaged to audit a not-for-profit organization in accordance with Government Auditing Standards, an auditor is required to prepare a written report on compliance with laws and regulations that includes Question 7 (NOTE: This is a CPAexcel simulated Exam Question, not AICPA licensed Material) The effects of financial leverage result when a firm finances assets using: Question 8 Which of the following statements is correct concerning both an engagement to compile and an engagement to review a nonpublic entity's financial statements? Question 9 Which of the following representations does an accountant make implicitly when issuing the standard report for the compilation of a nonpublic entity's financial statements? Question 10 Which of the following statements is correct regarding a review engagement of a nonpublic company's financial statements performed in accordance with the Statements on Standards for Accounting and Review Services (SSARs)? Question 11

33. In which of the following situations would an auditor ordinarily choose between expressing an "except for" qualified opinion or an adverse opinion? Question 12 When engaged to compile the financial statements of a nonpublic entity, an accountant is required to possess a level of knowledge of the entity's accounting principles and practices. This requirement most likely will include obtaining a general understanding of the Question 13 When a qualified opinion results from a limitation on the scope of the audit, the situation should be described in an explanatory paragraph Question 14 The standard report issued by an accountant after reviewing the financial statements of a nonpublic entity states that Question 15 Which of the following phrases would an auditor most likely include in the auditor's report when expressing a qualified opinion because of inadequate disclosure? Question 16 A client has capitalizable leases but refuses to capitalize them in the financial statements. Which of the following reporting options does an auditor have if the amounts pervasively distort the financial statements? Question 17

34. Wolf is auditing an entity's compliance with requirements governing a major federal financial assistance program in accordance with Government Auditing Standards. Wolf detected noncompliance with requirements that have a material effect on the program. Wolf's report on compliance should express Question 18 General Retailing, a nonissuer, has asked Ford, CPA, to compile its financial statements that omit substantially all disclosures required by GAAP. Ford may comply with General's request provided the omission is clearly indicated in Ford's report and the Question 19 Moore, CPA, has been asked to issue a review report on the balance sheet of Dover Co., a nonpublic entity. Moore will not be reporting on Dover's statements of income, retained earnings, and cash flows. Moore may issue the review report provided the Question 20 Reporting standards for financial audits under Government Auditing Standards (the Yellow Book) differ from reporting under generally accepted auditing standards in that Government Auditing Standards require the auditor to ==============================================

35. ACC 576 Week 5 Quiz (All Possible Questions) For more course tutorials visit www.tutorialrank.com This Tutorial contains More than 150 Question Test Bank (we have listed some of the Questions below) Week 5 Quiz Question 1 An accountant's compilation report on a financial forecast should include a statement that the Question 2 When a CPA examines a client's projected financial statements, the CPA's report should Question 3 At a confidential meeting, an audit client informed a CPA about the client's illegal insider-trading actions. A year later, the CPA was subpoenaed to appear in federal court to testify in a criminal trial against the client. The CPA was asked to testify to the meeting between the CPA and the client.

36. After receiving immunity, the CPA should do which of the following? Question 4 (NOTE: This is a CPAexcel simulated Exam Question, not AICPA licensed Material) XYZ Corporation is having financial difficulties. Its CFO has ordered subordinates to pump up revenues artificially and hide that fact from the external auditor. If an internal auditor of XYZ intentionally misleads XYZ's outsider auditor from the ABC Accounting firm, the internal auditor has: Question 5 (AICPA.080962REG-1B) (NOTE: This is a CPAexcel simulated Exam Question, not AICPA licensed Material) Duncan, an accounting firm, is auditing Alchemy Inc. Regarding commissions and referral fees, which of the following arrangements would be permissible? Question 6 A CPA who is not in public practice is obligated to follow which of the following rules of conduct? Question 7 Under the Statements on Standards for Consulting Services, which of the following statements best reflects a CPA's responsibility when undertaking a consulting services engagement? The CPA must Question 8

37. Under the Code of Professional Conduct of the AICPA, which of the following is required to be independent in fact and appearance when discharging professional responsibilities? Question 9 Locke, CPA, was engaged to perform an audit for Vorst Co. During the audit, Locke discovered that Vorst's inventory contained stolen goods. Vorst was indicted and Locke was validly subpoenaed to testify at the criminal trial. Vorst has claimed accountant-client privilege to prevent Locke from testifying. Locke may be compelled to testify Question 10 (NOTE: This is a CPAexcel simulated Exam Question, not AICPA licensed Material) Ron is a partner in the Houston office of KPMG. A partner in Ron's office is the lead partner on the team that audits Midstream Pipeline, which operates intrastate oil and gas pipelines, but Ron is not on the engagement team. Which of the following scenarios represents an independence violation of the AICPA Code of Conduct? Question 11 (NOTE: This is a CPAexcel simulated Exam Question, not AICPA licensed Material) The CPA firm, where Joanna is currently a tax partner, is auditing Bubbles Corp. in Austin. Her mother, Teresa, has been working as a receptionist for Bubbles for the last 30 years. Her best friend since grade school, Maggie, is currently serving as CFO at Bubbles. Joanna knows that her brother, Jonathan, sank most of his savings into a purchase of

38. 6% of Bubbles outstanding stock, which he currently owns. Does Joanna have an independence issue? Question 12 An accountant may accept an engagement to apply agreed-upon procedures to prospective financial statements provided that Question 13 (NOTE: This is a CPAexcel simulated Exam Question, not AICPA licensed Material) In order to preserve independence, the PCAOB requires: Question 14 According to the standards of the profession, which of the following activities would most likely not impair a CPA's independence? Question 15 According to the standards of the profession, which of the following circumstances will prevent a CPA performing audit engagements from being independent? Question 16 Which of the following is a term for an attest engagement in which a CPA assesses a client's commercial Internet site for predefined criteria that are designed to measure transaction integrity, information protection, and disclosure of business practices? Question 17

39. A CPA in public practice is required to comply with the provisions of the Statements on Standards for Attestation Engagements (SSAE) when Question 18 An accountant's report expressing an opinion on a nonissuer's internal control over financial reporting should state that Question 19 In a state jurisdiction having an accountant-client privilege statute, to whom may a CPA turn over work papers without a client's permission? Question 20 Mell Corp. engaged Davis & Co., CPAs. to audit Mell's financial statements. Mell's management informed Davis it suspected that the accounts receivable were materially overstated. Although the financial statements did include a materially overstated accounts receivable balance, Davis issued an unqualified opinion.Mell relied on the financial statements in deciding to obtain a loan from County Bank to expand its operations. County relied on the financial statements in making the loan to Mell. As a result of the overstated accounts receivable balance, Mell has defaulted on the loan and has incurred a substantial loss. If County sues Davis for fraud, must Davis furnish County with the audit working papers? ============================================== ACC 576 Week 6 Quiz (All Possible Questions)

40. For more course tutorials visit www.tutorialrank.com This Tutorial contains More than 150 Question Test Bank (we have listed some of the Questions below) ACC 576 Study Week 6 1.Which of the following did SOX NOT do to protect whistleblowers? 2.Dan provided original information to authorities regarding a securities fraud in his company. It led the SEC to impose penalties of $2 million. Which of the following is most likely to be Dan's award under Dodd-Frank? 3.Which of the following is necessary to be an audit committee financial expert, according to the criteria specified in the Sarbanes- Oxley Act of 2002? 4.Which of the following did Dodd-Frank do regarding a whistleblower's right to sue for retaliation accorded by SOX? 5.A public company audit committee's "financial expert" must have all of the following except: 6.Fang provided original information to authorities regarding a securities fraud in his company. The information led to an

41. imposition of penalties of $500,000. It also led to Fang being fired in retaliation by his public company employer. Which of the following is true? 7.Public company audit committees must contain which of the following? 8.Under SOX, it is a crime to punish a public company whistleblower who provides truthful information relating to which of the following: 9.Mar has been complicit in her public company's accounting fraud. She consults a lawyer as the time comes to file her firm's 10-K with the SEC. She is a little uncomfortable with what she might have to do. The lawyer will likely tell her that she will have to certify (and be potentially criminally liable for lying about) these matters: 10. Milo Corp. maintains daily backups of its accounting system in a fireproof vault in the file library. Weekly, monthly, and annual backups are stored in a secure, fireproof vault at an off-site location. 11. Maintenance of the backup files is an example of 12. Review of the audit (also called transaction) log is an example of which of the following types of security control? 13. Which of the following statements presents an example of a general control for a computerized system? 14. Controls in the information technology area are classified into the categories of preventive, detective, and corrective. Which of the following is a preventive control?

42. 15. A company's new time clock process requires hourly employees to select an identification number and then choose the clock-in or clock-out button. A video camera captures an image of the employee using the system. Which of the following exposures can the new system be expected to change the least? 16. Which of the following is an example of a detective control? 17. In the COSO "cube" model, each of the following is a control objective except 18. In the COSO "cube" model, this component of internal control enables an organization's people to identify, process, and exchange the information needed to manage and control operations. 19. This component of internal control concerns the policies and procedures that ensure that actions are taken to address the risks related to the achievement of management's objectives. 20. This fundamental component of internal control is the core or foundation of any system of internal control. 21. This component of internal control concerns testing the system and its data. 22. According to COSO, which of the following is a compliance objective? 23. This is the process of identifying, analyzing, and managing the risks involved in achieving the organization's objectives. 24. In the COSO (2011) "cube" model, each of the following are components of internal control except

43. 25. According to the 17 COSO control principles, risk reduction primarily relates to which fundamental component of internal control: 26. According to the 17 COSO control principles, establishing a whistle-blower hot line contributes to: 27. According to the 17 COSO control principles, information quality primarily relates to which fundamental component of internal control: 28. According to the 17 COSO control principles, organizational objectives primarily relate to which fundamental component of internal control: 29. According to the 17 COSO control principles, addressing control deficiencies primarily relates to which fundamental component of internal control: 30. According to the 17 COSO control principles, change management primarily relates to which fundamental component of internal control: 31. According to the 17 COSO control principles, fraud primarily relates to which fundamental component of internal control: 32. The original COSO model has _____ control components, while the COSO ERM model has _____ control components. 33. Strategic, operations, reporting, and compliance objectives are a part of which of the following models of internal control? 34. Which of the following items is one of the eight components of COSO's enterprise risk management framework?

44. 35. Which component of the COSO ERM framework is concerned with management's decision to avoid, accept, reduce, or share risk and to develop a set of actions to align risk with the entity's risk preferences? 36. Activities that can be useful in monitoring control system effectiveness include all of the following except 37. The goals of risk management include: 38. According to COSO, which of the following is the most effective method to transmit a message of ethical behavior throughout an organization? 39. Each of the following is a limitation of enterprise risk management (ERM) except 40. Which of the following control activities should be taken to reduce the risk of incorrect processing in a newly installed computerized accounting system? 41. Recognizing potential impediments to communication between system user and system designer can be useful in 42. A senior executive of an international organization who wishes to demonstrate the importance of the security of company information to all team members should 43. In which of the following organizations might segregation of duties be easiest to achieve? 44. A manufacturing firm noted that it would have difficulty sourcing raw materials locally, so it decided to relocate its production facilities. According to COSO, this decision represents which of the following responses to the risk?

45. 45. Which of the following is most useful when risk is being prioritized? 46. According to COSO, the two primary attributes of effective evaluators are 47. Which of the following are reasons that internal controls need to be monitored? 48. Which of the following is the best definition of a compensating control? 49. Within the COSO Internal Control-Integrated Framework, which of the following components is designed to ensure that internal controls continue to operate effectively? 50. According to COSO, an effective approach to monitoring internal control involves each of the following steps,except 51. According to COSO, the use of ongoing and separate evaluations to identify and address changes in internal control effectiveness can best be accomplished in which of the following stages of the monitoring-for-change continuum? 52. Internal control monitoring is considered 53. Which of the following is not a major step in the COSO model of control monitoring? 54. In a large public corporation, evaluating internal control procedures should be the responsibility of 55. The system of internal control begins with

46. 56. The IIA's International Professional Practices Framework includes among its "mandatory" guidance each of the following elements except 57. One of the Rules of Conduct in the IIA's Code of Ethics states, "Internal auditors shall perform internal audit services in accordance with the International Standards for the Professional Practice of Internal Auditing." To which Principle of the Code of Ethics does this Rule of Conduct relate? 58. The IIA's Code of Ethics identifies four "Principles" around which the 12 Rules of Conduct are organized. Each of the following key words or phrases is associated with these Principles except 59. What term identifies the type of internal auditing standards used to measure the quality of the internal auditor's conduct in delivering internal audit services? 60. What term identifies the type of internal auditing standards used to describe the characteristics associated with organizations and individuals who provide internal audit services? 61. The IIA's Definition of Internal Auditing specifically mentions each of the following terms among the organizational objectives to be improved by internal auditing except 62. What term is used in the IIA's International Standards to identify the person responsible for managing an organization's internal audit activity? 63. The Attribute Standards related to an internal audit activity's Quality Assurance and Improvement Program must include periodic external assessments. How often is an external assessment required?

47. 64. The Attribute Standards focus on four primary themes around which the remaining Attribute Standards are organized. Each of the following key words or phrases is associated with those four primary themes except 65. Standard 1300, "Quality Assurance and Improvement Program," states, "The chief audit executive must develop and maintain a quality assurance and improvement program that covers all aspects of the internal audit activity." Six additional Attribute Standards provide further requirements on that topic. Which of the following is an accurate statement regarding the standards applicable to the required Quality Assurance Improvement Program? 66. The Performance Standards focus on seven primary themes around which the remaining Performance Standards are organized. Each of the following key words or phrases is associated with these seven primary themes except 67. The Performance Standards focus on seven primary themes around which the remaining Performance Standards are organized. Each of the following key words or phrases is associated with these seven primary themes except 68. What term identifies the guidance in the International Standards for the Professional Practice of Internal Auditing that distinguishes between requirements for "assurance" services and "consulting" services? 69. There are seven additional Performance Standards that relate to Standard 2000, "Managing the Internal Audit Activity." The general theme of these standards associated with Managing the Internal Audit Activity is best characterized by which of the following statements?

48. Quiz 6 Question 1 (IFTC-0112) Controls in the information technology area are classified into the preventive, detective, and corrective categories. Which of the following is a preventive control? Question 2 (IFTC-0082) An organization relied heavily on e-commerce for its transactions. Evidence of the organization's security awareness manual would be an example of which of the following types of controls? Question 3 (IFTC-0067) Which of the following types of control plans is particular to a specific process or subsystem, rather than related to the timing of its occurrence? Question 4 (CGIC-0032) Which of the following is true about the Sarbanes-Oxley requirements regarding the audit committee financial expert? Question 5 (CGIC-0026) Which of the following is not a component of COSO's enterprise risk management framework? Question 6 (CGIC-0010) Which of the following is not required by the Sarbanes-Oxley Act of 2002? Question 7 (CGIC-0025)

49. Which of the following is not an advantage of the employment of an enterprise risk management (ERM) system? Question 8 (CGIC-0008) A financial statement audit performed under the requirements of the Sarbanes-Oxley Act of 2002 must include an examination and report upon Question 9 (CGIC-0024) An important benefit of an enterprise risk management system is Question 10 (CGIC-0023) Which of the following bodies has developed a framework for enterprise risk management? Question 11 (CGIC-0005) Which of the following executives of an issuer corporation must certify to the accuracy and truthfulness of financial reports filed with the SEC? Question 12 (CGIC-0004) Which of the following is not a responsibility that should be assigned to the audit committee of the board of directors? Question 13 (CGIC-0018) Which of the following components of internal control are characterized by ongoing activities and separate evaluations? Question 14 (CGIC-0003)

50. Which of the following can be the most effective monitoring device for effective corporate governance? Question 15 (CGIC-0002) From a corporate governance standpoint which of the following best describes the main goal of a form of executive compensation? Question 16 (CGIC-0019) Which of the following components of internal control encompass policies and procedures that ensure that management's directives are carried out? Question 17 (CGIC-0001) Which of the following forms of compensation is more likely to result in shirking by management? Question 18 (CGIC-0036) In the COSO framework, individuals within the company that monitor internal controls are referred to as Question 19 (CGIC-0016) The COSO definition of internal control considers control activities a(n): Question 20 (CGIC-0021) If internal control is properly designed, the same employee should not be permitted to ==============================================