When Documenting an Entity's Internal Control, the Independent Auditor Sometimes

question 41

Multiple Choice

When documenting an entity's internal control, the independent auditor sometimes uses a systems flowchart, which can best be described as a:

• A)pictorial presentation of the flow of instructions in an entity's internal computer system.
• B)diagram which clearly indicates an organization's internal reporting structure.
• C)graphic illustration of the flow of operations which is used to replace the auditor's internal control questionnaire.
• D)symbolic representation that represents the flow of documents and the processing steps among departments in the entity.

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Definitions:

Double Coincidence

A situation in a barter economy where two parties each hold an item the other wants, allowing them to make an exchange without the use of money.

Federal Deregulation

The process of reducing or eliminating government rules and restrictions on the business sector by federal authorities.

Savings And Loan

Financial institutions that primarily accept savings accounts and provide mortgage lending, historically focusing on residential mortgages.

Taxpayers

Individuals or entities that are obliged to pay taxes to a government authority based on their income, property, or consumption.