Audit Teams Would Most Likely Introduce Test Data into a Computerized

question 34

Multiple Choice

Audit teams would most likely introduce test data into a computerized payroll system to test internal controls related to the

• A) existence of unclaimed payroll checks held by supervisors.
• B) early cashing of payroll checks by employees.
• C) discovery of invalid employee identification numbers.
• D) proper approval of overtime by supervisors.

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Definitions:

Investing Activity

Transactions involving the purchase and sale of long-term assets and investments, part of a company's cash flow activities.

Financing Activity

Transactions that result in changes in the size and composition of the equity capital or borrowings of a company.

Net Income

The total earnings of a company after all expenses and taxes have been subtracted from total revenue.

Fiscal Year

It is a one-year period that companies and governments use for financial reporting and budgeting, which does not necessarily align with the calendar year.