In: Accounting
1. A file that stores sales orders pending shipment of ordered goods or completion of services is an example of a(n) ___________ file. A. master B. transaction C. open D. reference
2. Which of the following is not a reason that an external
auditor would have an interest in an organization's internal
control?
A. The external auditor is required to evaluate internal control in
planning an external audit, according to generally accepted
auditing standards
B. Internal control provides a measure of protection against
erroneous or fraudulent financial reporting
C. Strong internal control can eliminate the test of controls
required to be performed by the external auditor
D. The Sarbanes-Oxley Act of 2002 requires the external auditor
attest to and report on management’s assessment of internal
control
3. Of the following control activities, which is the most
effective?
A. Bonding of employees
B. Segregation of duties
C. Enforced vacations
D. Rotation of assignments
Ans:-
1)The answer is reference because reference of goods or services happens after completion of packing but before shipment of goods. And here goods and services are under pending shipment.
Option D is right
2) option B is right
Because this is not a reason that external auditor would have interest on organizational internal controls. And it is an advantage that checking of internal controls provides a measure of protection against erroneous and fraudulent financial reporting.
3). Option B is right
Because from remaining options there is effect to the process of operations like Bonding of employees will lead to get relationships by this idel time of employees will increase. By Enforced vocation may an employee can take leave on peak stage production process. Rotation of assignments will leads to slow down the performance of employees ie., By regular rotations employees may take time to know the process.
But segregation of duites may increase the performance of employees ie., By this segregation employee will get expertise in his work, time to perform the work will decrease.and it is most effective control activity in organising.