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5 Written questions

5 Matching questions

  1. Which of the following is most likely to indicate fraud? A-Several overpayments are made for goods received from a supplier. B-The year end cash balance does not include cash in transit to the company at year-end. C-A check received after year end was inadvertently recorded as if received before year-end. D-A documented loan to an officer of the company
  2. Kiting (402)
  3. Jones embezzled $50,000 from his company's account in Bank A. At year-end he hid the shortage by making a deposit on December 31 in Bank A, drawn on Bank B. He has not recorded the transaction on the books. This is an example of: A-Lapping. B-Kiting. C-Effective cash management. D-Related party transactions.
  4. Which of the following is confirmed on the standard form used for cash balances at financial institution? A-Factored accounts receivable B-Loss contingencies C-Loans payable D-Safe deposit boxes controlled by the entity
  5. Of the following, which procedure or document is most effective for detecting kiting? A-A bank cutoff statement B-A bank reconciliation C-A bank kiting statement D-A bank transfer schedule
  1. a C-Loans payable
  2. b ...
  3. c A-Several overpayments are made for goods received from a supplier.
  4. d B-Kiting.
  5. e D-A bank transfer schedule

5 Multiple choice questions

  1. C-The Controller should have control of accounting functions and the Treasurer should have control of cash receipt functions.
  2. D-Valuation
  3. D-General ledger.
  4. B-Checks dated prior to year-end to the outstanding checks listed on the year-end bank reconciliation.
  5. A reference book published monthly by investment advisory services reporting detailed information concerning all listed and many unlisted securities; includes dividend dates and amounts, current prices of securities, and other condensed financial data.

5 True/False questions

  1. Electronic data interchange EDI (384)...

          

  2. Electronic funds transfer ETF (384)A bank statement covering a specified number of business days (usually 7-10) after the client's balance sheet date. Auditors use this statment to determin the checks issued on or before the blance sheet date and paid during the cutoff period were listed as outstanding on the year-end bank reconciliation. Another use is to determin the reconciling items shown on the year-end bank reconciliation have cleared the bank within a reasonable amout of time.

          

  3. A company owns a large amount of debt securities that pay interest twice a year - August 1 and February 1. On the financial statements the company accrued the 5 months of interest it was due as interest receivable. The auditor should: A-Require the accrual be reversed since the interest has not yet been paid. B-Confirm the interest accrual with the security issuer. C-Require the accrual be reversed since the company could sell the security before interest has been paid. D-Verify the company owns the security, check the accuracy of the accrual, and require no adjustment.D-Verify the company owns the security, check the accuracy of the accrual, and require no adjustment.

          

  4. Voucher (386)Financial instruments that "derive" their value from other financial instruments, underlying assets, or indexes. Examples are options, forward contracts, and futures contracts.

          

  5. Proof of Cash (399)Financial instruments that "derive" their value from other financial instruments, underlying assets, or indexes. Examples are options, forward contracts, and futures contracts.