To Determine Whether the Internal Control Structure Policies and Procedures

question 8

Multiple Choice

To determine whether the internal control structure policies and procedures operate effectively to minimise errors of failure to invoice a shipment, the auditor would select a sample of transactions from the population represented by the:

• A)subsidiary customer accounts ledger.
• B)sales invoice file.
• C)bill of lading file.
• D)customer order file.

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Definitions:

Automatic Withdrawals

Electronic funds transfers or payments automatically deducted from a bank account, typically used for recurring expenses.

Endowment Effect

The phenomenon where individuals value an owned object higher than they would if they did not own it.

Raffle Prize

A reward given to a randomly selected participant in a raffle, where people enter by purchasing tickets for a chance to win.

Myopia

Refers to the difficulty human beings have with conceptualizing the more distant future. Leads to decisions that overly favor present and near-term options at the expense of more distant future possibilities.