24905560
Beschreibung
Quiz von Kayla Harbaugh, aktualisiert more than 1 year ago
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Erstellt von Kayla Harbaugh
vor fast 4 Jahre
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Frage 1
Frage
What is the primary difference between fraud and error in financial statement reporting?
Antworten
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The level of management involved
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The type of transaction effected
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The intent to deceive
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The materiality of the misstatement
Frage 2
Frage
Which of the following is a common rationalization for fraudulent financial reporting?
Antworten
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This is a one-time transaction and it will allow the company to get through the current financial crisis, but I'll never do it again.
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No-one will be hurt if I take some inventory for personal use. No-one will even know.
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I am only borrowing the money; I will pay it back next year.
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Executives at other companies are getting paid more than I am, so I deserve the money.
Frage 3
Frage
Which of the following types of transactions did WorldCom management engage in as part of that company's fraudulent financial reporting scheme?
Antworten
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Recorded barter transactions as sales
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Used restructuring reserves from prior acquisitions to decrease expenses
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Capitalized line costs rather than expensed them
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All of these
Frage 4
Frage
Which of the following statements is true?
Antworten
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Unless an independent audit can provide reasonable assurance that financial information has not been materially misstated because of fraud, it has little, if any, value to society.
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Repeated revelations of accounting scandals and audit failures related to undetected frauds have seriously damaged public confidence in external auditors
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A strong ethical tone at the top of an organization that permeates corporate culture is essential in mitigating the risk of fraud
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All of these
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None of these
Frage 5
Frage
Refer to Exhibit 2.5. The Sarbanes-Oxley Act enacted which of the following provisions relevant to auditors and the audit opinion formulation process?
Antworten
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The PCAOB was established, and it has the power to conduct inspections of public company audits.
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The lead audit partner and reviewing partner must rotate off the audit of a publicly traded company at least every 10 years.
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In the annual report, management must acknowledge that they are required to have the company's internal audit function attest to the accuracy of the annual reports.
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All of these
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None of these
Frage 6
Frage
Audit committee activities and responsibilities include which of the following?
Antworten
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Selecting the external audit firm
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Approving corporate strategy
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Reviewing management performance and determining compensation
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All of these
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None of these
Frage 7
Frage
The three elements of the fraud triangle include incentive, opportunity, and rationalization.
Antworten
- True
- False
Frage 8
Frage
In the Enron fraud, one of the ways that management covered up the fraud was to shift debt off the balance sheet to SPEs.
Antworten
- True
- False
Frage 9
Frage
An important change resulting from the Sarbanes-Oxley Act is that auditors are no longer allowed to provide most consulting services for their public company audit clients.
Antworten
- True
- False
Frage 10
Frage
The term corporate governance mosaic refers to the fact that each of the parties involved in corporate governance has complementary roles and specific responsibilities; no one party is completely responsible.
Antworten
- True
- False
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