a. These are related to monitoring which ensures that the controls are operating properly and efficiently. New business models that use mobile phones, ICTs (information communication technologies), and apps remove middle management layers in traditional organizations and structures. copyright 2003-2023 Homework.Study.com. The control environment b. a. A participative budgetary approach. 20 Q . What are the key elements of the internal environment section of the model? c. internal control systems are designed to do all of what is mentioned in the other alternatives. b. Describe the role, played in a company's system of internal controls, by management, audit committee, external auditors, and internal audit department. Answer to: A firm's internal control environment is influenced by: i. management's operating style. detective controls, Our Experts can answer your tough homework and study questions. 1. d. internal control. The dominance of the global function-based groups and global hierarchy characteristics reduces the capacity of Amazon to rapidly respond to new issues and problems encountered in the e-commerce business.43 Still, Amazons most outstanding success factor remains its CEO, Jeff Bezoshis ingenuity, vision and foresight, and ability to sustain and even extend the companys competitive advantages. Answer to: 1. Retailers must encourage suppliers and manufacturers self-governance of chemical product safety within their spheres. Globalization continues to affect industries and companies in ways that benefit some and not others. Who is responsible for establishing internal controls within the organization? ScholarOn, 10685-B Hazelhurst Dr. # 25977, Houston, TX 77043,USA. A. management's philosophy and operating style Which of the following best describes an engagement to report on an entity's internal control over financial reporting for a nonpublic company? Commitment to competence. What are some examples of effective internal controls? You are the internal audit manager for Peak Corporation. In establishing an effective internal control structure, management should: a. Risk assessment c. Control procedures d. Monitoring. Natural disaster and human induced environmental problems are events such as high-impact hurricanes, extreme temperatures and the rise in CO2 emissions as well as man-made environmental disasters such as water and food crises; biodiversity loss and ecosystem collapse; large-scale involuntary migration are a force that affects organizations. If you are redistributing all or part of this book in a print format, This term describes the policies, plans, and procedures implemented by a firm to protect the assets of the organization: a) Internal control b) SAS No.94 c) Risk assessment d) Monitoring, Operational control has a management-by-exception approach in contrast to management control, which is more consistent with: A. 61. What should, In order for the internal auditor to properly perform his/her duties without compromise, which individual/entity should oversee the internal auditor? At what stage in the development of business do they become especially crucial? How does the control environment affect a company's internal controls? A) Control Activities B) Control Environment C) Risk Assessment D) Monitoring E) Communication and Information. (a) Employees who have physical cu, In reviewing the governance process, which of the following is not applicable to the role of top management? information and communication, 64. Relationships, norms, and politics are also included in the informal organization. i. d. all of these 2. Why is the control environment so important to effective internal control over financial reporting? Why is physical control such an important internal control? COSO ( The Committee of Sponsoring Organizations of the Treadway Commission) defines internal control as a process, effected by an entity's board of directors, management and other personnel, designed to provide reasonable assurance regarding the achievement of objectives. What is the control environment? Note that it is the CEO and other top-level leaders who scan the external environment to identify uncertainties and resources before using a SWOT analysis (identifying strengths, weaknesses, opportunities, and threats) to confirm and update the domain of an organization and then to define the vision, mission, goals, and strategies. A firm's internal control environment is influenced by: a. management's operating style. There are other internal functions not listed here, such as research and development, accounting and finance, production, and human resources. a. C. Internal environment. Which of the following is considered to be the foundation of an internal control structure: A) Control Activities B) Control Environment C) Risk Assessment D) Monitoring E) Communication and Information. Which of the following is an example of a compliance audit? Identify the six major organizational structures. Our experts can answer your tough homework and study questions. Identify each of the following as relating to (a) the control environment, (b) control procedures, or (c) monitoring: 1. Assume that you are a key member on an audit engagement team and discover a breach in internal controls. A Firm's Internal Control Environment Is Not Influenced By 77+ Pages d. all of these. In the context of the audit of a private company, discuss management's responsibilities related to internal controls. Provide an effective accounting system. chapter 10 Flashcards by Byron Loja | Brainscape Internal Controls:. Internal auditors can be distinguished from external auditors because: a. More simply, internal control is: A process. A company's control environment is primarily influenced by the tone at the top. B) An individual cannot be hired into an internal auditing department with. Afirm The leading provider of Premium Audits, Loss Control Inspections & Risk Services in North America. A firm's internal control environment is not influenced by. Describe the role that performance indicators could have in achieving organizational success and compliance with organizational internal controls. d. all of these. Risk assessment c. Control procedures d. Monitoring. Organizations are groups of people deliberately formed together to serve a purpose through structured and coordinated goals and plans. Physical control is a key feature in an internal control system. Get access to this video and our entire Q&A library, Internal Controls in Accounting: Definition, Types & Examples. 1. C) The members of a company's board of di. b. are policies and procedures designed to produce accurate accounting records. Because of immigration, millennials are estimated to increase until 2036.8. (1) An audit of financial statements. b. the policies and procedures that are carried out by management. The independent auditor The government The SEC Management _________________, A company has two employees handling acquisitions of inventory. You have been asked to explain to the CEO how technology can help with internal control monitoring. B. bank checking accountsC. Managers are affected by the organizational environment and help to create it. Hiring practices. Sharing-economy companies such as Uber and Airbnb have redefined the transportation domain in which taxis operate and the hospitality domain in which hotels and bed and breakfasts serve. d. all of these 2. The independent auditor The government The SEC Management _________________. b. 8.4 A Firm's Micro Environment: Porter's Five Forces; 8.5 The Internal Environment; 8.6 Competition, Strategy, and Competitive Advantage; 8.7 Strategic Positioning; Key Terms; Summary of Learning Outcomes; . Solved > 61. A firm's internal control environment is not:1234137 A firm's internal control environment is not influenced by a. management's operating style b. A firm's internal control environment is influenced by: a. management's operating style. Question 1.1. a firm's internal control environment is influenced by b. help. Reflects management's philosophy and operating style b. Chapter 8 Flashcards - Learning tools, flashcards, and textbook solutions An ineffective control environment. B) The actions, policies, and procedures that reflect the overall attitudes of top management about control. Which of the following elements of internal control includes maintaining records of employees documenting their compensation and promotion? Who is responsible for establishing internal controls within the An element of internal control is A.risk assessmentB. What are two major constraints of any system of internal control? A check drawn by a company for $340 in payment of a liability was recorded in the journal as $430. The management approach requires a firm to define segments on the basis of its internal organization structure. a) Organizational structure b) Board oversight c) Corporate culture d) Management control systems e) All of the above. Physical control is a key feature in an internal control system. A company's management and its independent auditor both have responsibilities related to the company's system of internal control. A well-formulated HRM strategy will help aggregate and allocate a firm's resources into a unique entity on the basis of all of the following except: A. internal strengths and weaknesses. Chinas GDP (gross domestic product) is estimated at $13.2 trillion in 2018, outpacing the $12.8 trillion combined total of the 19 countries that use the euro.5 Corporations worldwide, large and small, online and land-based, strive to gain access to sell in Chinas vast markets. Assume that you are a key member on an audit engagement team and discover a breach in internal controls. Why is physical control such an important internal control? Describe the role that performance indicators could have in achieving organizational success and compliance with organizational internal controls. systems analysisD. The 2022 RSL is now available. 1. A company's management and its independent auditor both have responsibilities related to the company's system of internal control. have a direct effect on a company's internal control system? A sales staff had successfully logged into the payroll system by guessing the payroll supervisor's password. Discuss management s and internal auditor s responsibilities with respect to internal controls. Risk assessment c. Control procedures d. Monitoring. Promote the achievement of a target EPS. c. personnel. Many look at the controls as simply a protection of assets for the organization, but that is not always the case. Economically, The strategic challenge of the next decade is navigating a world that is simultaneously integrating and fragmenting. One employee places purchase orders and pays vendors. Closed systems are less sensitive to environmental resources and possibilities, and open systems are more responsive and adaptive to environmental changes. Download it now. Describe how each enhances an organisation's governance, risk management, and internal control processes. a) Control procedures b) Control environment c. In designing management control systems, top managers should consider the system's impact on the behavior of employees. Presenting seminars for the apparel and footwear supply chain. Accounting--Chapter 8 Flashcards | Quizlet a. internal orientation b. collectivism c. need for control d. risk-aversion, Which of the following is not a role of the internal audit activity in performing assurance services? a. organizational structure. b. encourage adherence to prescribed management policies. An attestation eng, Which of the following is most likely to be considered a material weakness in internal control? Affects management's financial statement assertions c. Provides adequa. Internal and External Environment Factors of Organizational - iEduNote a. Our mission is to improve educational access and learning for everyone. a. C) internal control. Monitoring policies are not related to the control environment. A firm's internal control environment is influenced by: a. management's operating style. What effect does this have on IT internal controls? b. Restatement of previously issued financial statements due to a change in accounting principles. An internal control system consists of all policies and procedures used to protect assets, ensure reliable accounting, promote efficient operations, and urge adherence to company policies. C. Monitoring D. Organizational structure. What do you understand by the term Internal Control ? 2. This book uses the d. all of these. A firm's internal control environment is influenced by management's operating style, organizational structure, & personnel policies. How do those controls protect employer? d. all of these. Seemingly contradictory realities do co-exist.7 Overall, while economic data indicates that globalization has had a positive effect on the world economy, a dark side also shows that two-thirds of all households in 25 advanced-economy countries had incomes stagnate and/or decline between 2005 and 2014. controlling accounts, 63. The Internal Control Framework is designed to establish institutional standards and accountability foroperating the internal control system by specifying: The objective is to integrate several control mechanisms into one coherent and comprehensive framework. At a basic level of understanding how internal organizations respond to environments, consider the theory of Open Systems, which the organizational theorists Katz and Kahn35 and Bertalanffy introduced.36. B) the effectiveness of management. Organizations respond to external environments not only through their structures, but also by the domains they choose and the internal dimensions and capabilities they select. Many look at the controls as simply a protection of assets for the organization, but that is not always the case. A. risk assessment B. monitoring C. information and communication D. cost-benefit considerations D. cost-benefit considerations 56. Why is physical control an important internal control? Moreover, the U.K. and U.S. witnessed falling wages. Audit Committee and Management. The big picture of an organizations external environment, also referred to as the general environment, is an inclusive concept that involves all outside factors and influences that impact the operation of a business that an organization must respond or react to in order to maintain its flow of operations.4 Exhibit 4.2 illustrates types of general macro environments and forces that are interrelated and affect organizations: sociocultural, technological, economic, government and political, natural disasters, and human-induced problems that affect industries and organizations. a. ensure that the company's operating activities are performed in accordance with company objectives. consent of Rice University. Climate and environment. b. The management's operating style, personnel policies, and organization structure are some of the factors or based for the design and implementation of the organization's internal control. 4. A) The organizational structure B) The audit committee C) The Foreign Corrupt Practices Act D) Management's philosophy and operating style, The control environment can be defined as A) The lines of authority and responsibility within a company. A firm's internal control environment is influenced by: i. management's operating style. A firm's internal control environment not influenced by A. management's operating : 1239835, A necessary element of internal control is, In management's internal control report that is now required of all public companies, which of the following does. How can internal controls benefit the individual employee? d, Write a brief summary of the AIS used at your place of employment. What are the key elements of the control portion of the model? Define the external environment of organizations. This refers to each of the following except: a. the philosophy and operating style of management. Internal Control Framework - International Fund for Agricultural Wealth distribution in these countries continues to decline. Gender. Nutrition. Many new companies in the United States are already constructing buildings to withstand increasing flooding and predicted rising water levels. The report showed that 2017 was characterized by high-impact hurricanes, extreme temperatures, and the first rise in carbon dioxide emissions in four years; man-made environmental disasters; water and food crises; biodiversity loss and ecosystem collapse; and large-scale involuntary migration to name a few. Afirm Homepage Which of the following is an example of a compliance audit? Recent events that have jarred the global economyand are too early to predict the long-term outcomes ofare the United Kingdoms exit from the European Union, wars in the Middle East, policies that question and disrupt free trade, health-care reform, and immigrationall of which increase uncertainty for businesses while creating opportunities for some industries and instability in others. When performing an audit of internal control under PCAOB requirements, auditors evaluate control: a) design effectiveness yes, operating effectiveness yes b) design effectiveness yes, operating effectiveness no c) design effectiveness no, operating eff. c. the ex. Internal control does not consist of policies and - Course Hero In the development of financial accounting standards there are six organizations that are influent, Control activities can be defined as A) The lines of authority and responsibility within a company. What are some examples of effective internal controls? c. Monitoring the implemen, _______ involves ensuring proper strategic controls and organizational designs. 2) Gain insights into how to develop strategies and tactics that would help you (and your organization) navigate ways to cope with or try to dominate or appeal to elements (e.g., market segments, stakeholders, political/social/economic/technological issues) in the environment. Provide an effective accounting system.
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