Which of the Following Is Not True

question 84

Multiple Choice

Which of the following is not true?

• A) Management may outsource their organizations' IT functions, but they cannot outsource their management responsibilities for internal control.
• B) Section 404 requires the explicit testing of outsourced controls.
• C) The SSAE 16 report, which is prepared by the outsourcer's auditor, attests to the adequacy of the vendor's internal controls.
• D) Auditors issue two types of SSAE 16 reports: Type I report and Type II report.

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Definitions:

Comparative Balance Sheet

A financial statement that presents the assets, liabilities, and shareholders' equity at different time points to analyze trends.

Net Cash

The amount of cash available after accounting for cash inflows and outflows, reflecting the actual liquidity position of an individual or business at a specific point in time.

Operating Activities

Business activities related to daily operations, including sales, supply chain management, and other core functions.

Accounts Receivable

Funds that a business has yet to receive from its customers for the products or services it has already provided.