1 -- City Advertising Services hired a new accounting manager. He signed a contr

Question

1 -- City Advertising Services hired a new accounting manager. He signed a contract for a new accounting information system, but his position did not specify whether he was authorized to do so or not. Which internal control procedure needs strengthening?

A. competent, reliable, and ethical personnel

B. documents

C. assignment of responsibilities

D. separation of duties

2. Which of the following components of internal control consist of work performed by internal and external auditors?

A. information systems

B. control procedures

C. monitoring of controls

D. control environment

3. Which of the following statements describes a purchase order?

A. It is a document authorizing a payment to a supplier.

B. It is an order to purchase goods from a supplier.

C. It is a statement from the supplier showing the goods purchased and the amount due.

D. It is a report showing that the goods have been received in good condition, as ordered.

Explanation / Answer

1 Correct answer is: C Assignment of responsibilities As there is no controls on which task is to be performed by whom, the responsibilities shall be assigned to different personals and it should be documented for more effiective assignment and each personal should be aware of their duties and responsibilities. 2 Correct answer is: D Control enviornment Auditors wheather internal auditors or external auditore need to check the the control enviornment of the company to ensure that internal controls are effective on weak on which the planning and strategy building and checking of the Auditor depends. 3 Correct answer is: B It is an order to purchase goods from the supplier In companies work is done department wise and usually duties are segregated purchase order is raised and forwarded to purchase department who shall act accordingly to purchase goods from supplier.

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