In Performing the Audit of Internal Control Over Financial Reporting

question 17

Multiple Choice

In performing the audit of internal control over financial reporting, the auditor emphasizes internal control over classes of transactions because

• A) the accuracy of accounting system outputs depends heavily on the accuracy of inputs and processing.
• B) the class of transaction is where most fraud schemes occur.
• C) account balances are less important to the auditor then the changes in the account balances.
• D) classes of transactions tests are the most efficient manner to compensate for inherent risk.

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Definitions:

Excitement Phase

The initial phase of the sexual response cycle, characterized by increased arousal and physiological changes in preparation for sexual activity.

Seminal Fluid

A fluid that is part of semen, produced by several glands in the male reproductive system, and serves to transport and nourish sperm.

Contractions

In physiology, the process of muscle fibers shortening and generating force; in linguistics, the shortening of words by omitting sounds or letters.

Refractory Period

A period immediately following stimulation during which a nerve or muscle is unresponsive to further stimulation.