AUDTHEO THEO TB

Question 1

Which of the following is the most appropriate action to be taken by a CPA who has been asked to
perform a consulting services engagement concerning the analysis of a potential merger if he/she
has little experience with the industry involved?
a. Accept the engagement but he/she should conduct research or consult with others to obtain sufficient competence.
b. Decline the engagement because he/she lacks sufficient knowledge.
c. Accept the engagement and issue a report that contains his/her opinion on the achievability of
the results of the merger.
d. Accept the engagement and perform it in accordance with Philippine Standards in Auditing
(PSAs).

Answer 1

Accept the engagement but he/she should conduct research or consult with others to obtain sufficient competence.

Question 2

Governmental auditing often extends beyond examinations leading to the expression of opinion on
the fairness of financial presentation and includes audits of efficiency, economy, effectiveness, and
also
a. Accuracy
b. Compliance
c. Evaluation
d. Internal Control

Answer 2

Compliance

Question 3

The term “efficiency” in performance auditing refers to
a. Using resources to maximize output for a given input, or to minimize input for any given
quantity and quality of output.
b. The achievement of intended results of operations, programs or activities.
c. The achievement of objectives within a specified time frame.
d. The acquisition of resources at appropriate times and within a specified time frame

Answer 3

Using resources to maximize output for a given input, or to minimize input for any given
quantity and quality of output.

Question 4

Which of the following statements is not true in respect of internal auditor?
a. The scope of audits performed by the internal auditor is primarily in respect of financial
report audits.
b. An internal auditor does not require a license to practice.
c. Internal auditors are usually employed by companies and government units.
d. Primary responsibility of the internal auditor is to the board of directors.

Answer 4

The scope of audits performed by the internal auditor is primarily in respect of financial
report audits.

Question 5

The internal auditing department’s responsibility for deterring fraud is to
a. Establish an effective internal control system.
b. Maintain internal control.
c. Examine and evaluate the system of internal control.
d. Exercise operating authority over fraud prevention activities.

Answer 5

Examine and evaluate the system of internal control.

Question 6

In conducting an appraisal of the economy and efficiency with which company resources are used,
an internal auditor’s responsibility is to
a. Verify the accuracy of asset valuation.
b. Review the reliability of operating information.
c. Verify the existence of assets.
d. Determine whether operating standards have been established

Answer 6

Determine whether operating standards have been established

Question 7

Internal auditors should review the means of physically safeguarding assets from losses arising
from
a. Exposure to the elements.
b. Underusage of physical facilities.
c. Misapplication of accounting principles.
d. Procedures that are not cost justified.

Answer 7

Exposure to the elements.

Question 8

What is the proper organizational role of internal auditing?
a. To serve as an independent, objective assurance and consulting activity that adds value to operations.
b. To assist the external auditor in order to reduce external audit fees.
c. To perform studies to assist in the attainment of more efficient operations.
d. To serve as the investigative arm of the audit committee of the board of directors

Answer 8

To serve as an independent, objective assurance and consulting activity that adds value to operations.

Question 9

Which of the following can be significantly affected by a financial statement audit?
a. Business Risk
b. Information Risk
c. Inherent Risk
d. The risk-free interest rate

Answer 9

Information Risk

Question 10

Which of the following activities would generally account for a significant proportion of an internal
auditor’s time?
a. Checking the company is complying with all of its rules and regulations of operation.
b. Verifying all invoices before payment is made.
c. Ensuring the company is operating within budget.
d. Evaluating the effectiveness and efficiency of all phases of an entity’s operations

Answer 10

Evaluating the effectiveness and efficiency of all phases of an entity’s operations

Question 11

Which of the following actions would be an appropriate response by companies to improve the
public’s perception of their financial reporting?
a. Increased adoption of audit committees.
b. Keeping external and internal auditing work separated to maintain independence.
c. Requiring internal auditors to report all significant findings of fraud and illegal activity to the
company president.
d. None of the above.

Answer 11

Increased adoption of audit committees.

Question 12

The internal auditing profession has advanced primarily as a result of
a. Increased interest by BSA graduates and experienced auditors.
b. Job qualification specifications that include added emphasis on background knowledge
and skills.
c. The limitation of financial statement audit scope.
d. Increased complexity and sophistication of business operations.

Answer 12

Increased complexity and sophistication of business operations.

Question 13

Which of the following factors would most likely cause an auditor to decline a new audit
engagement?
a. Concluding that the entity’s new management probably lacks integrity.
b. An inability to perform preliminary analytical procedures before assessing control risk.
c. An inadequate understanding of the entity’s internal control.
d. The close proximity to the end of the entity’s reporting period.

Answer 13

Concluding that the entity’s new management probably lacks integrity.

Question 14

Before accepting an engagement to audit a new client, an auditor is required to:
a. Obtain a copy of the client’s financial statements.
b. Prepare a memorandum setting forth the staffing requirements and documenting the preliminary
audit plan.
c. Make inquiries of the predecessor auditor after obtaining consent of the prospective
client.
d. Discuss the management representation letter with the client’s audit committee

Answer 14

Make inquiries of the predecessor auditor after obtaining consent of the prospective
client.

Question 15

Which of the following conditions most likely would pose the greater risk in accepting a new audit engagement?
a. There will be a client-imposed scope limitation.
b. The client’s financial reporting system has been in place for 10 years.
c. The firm will have to hire an expert in one audit area.
d. Staff will need to be rescheduled to cover this new client.

Answer 15

There will be a client-imposed scope limitation.

Question 16

The auditor faces a risk that the audit will not detect material misstatements in the financial statements. In regard to minimizing this risk, the auditor primarily
relies on:
a. Internal control.
b. Tests of controls.
c. Substantive procedures.
d. Statistical analysis.

Answer 16

Substantive procedures

Question 17

The most difficult type of misstatement to detect is fraud based on
a. The over recording of transactions.
b. Related-party receivables.
c. Recorded transactions in subsidiaries.
d. The nonrecording of transactions.

Answer 17

The nonrecording of transactions.

Question 18

Which of the following conditions identified during the audit increases the risk of employee fraud?
a. Inventory items of small size, but high value.
b. Existence of a mandatory vacation policy for employees performing key functions.
c. Presence of reconciling items on a client prepared year-end proof of cash.
d. Large amounts of cash in the bank.

Answer 18

Inventory items of small size, but high value.

Question 19

An abnormal fluctuation in gross profit that might suggest the need for extended audit procedures for sales and inventories would most likely be identified in the planning phase of the audit by the use of:
a. Analytical procedures.
b. Tests of transactions and balances.
c. Specialized audit programs.
d. An assessment of internal control.

Answer 19

Analytical procedures.

Question 20

1. f believes that an understanding with the client has not been established, he or she should
   ordinarily
   a. Perform the audit with increase professional skepticism.
   b. Decline to accept or perform the audit.
   c. Assess control risk at the maximum level and perform a primarily substantive audit.
   d. Modify the scope of the audit to reflect an increased risk of material misstatement due to fraud.
2. An auditor should design the written audit program so that
   a. All material transactions will be selected for substantive testing.
   b. Substantive tests prior to the balance sheet date will be minimized.
   c. The audit procedures selected will achieve specific audit objectives.
   d. Each account balance will be tested under either tests of controls or tests of transactions.
3. Which of the following fraudulent activities most likely could be perpetrated due to the lack of
   effective internal controls in the revenue cycle?
   a. Fictitious transactions may be recorded that cause an understatement of revenues and
   overstatement of receivables.
   b. Claim received from customers for goods returned may be intentionally recorded in other
   customer’s accounts.
   c. Authorization of credit memos by personnel who receive cash may permit the misappropriation
   of cash.
   d. The failure to prepare shipping documents may cause an overstatement of inventory balances.
4. Accepting an engagement to examine an entity’s financial projection most likely would be
   appropriate if the projection were to be distributed to
   a. All employees who work for the entity.
   b. Potential stockholders who request a prospectus or a registration statement.
   c. A bank with which the entity is negotiating for a loan.
   d. All stockholders of record as of the report date.
5. In assessing control risk for purchases, an auditor vouches a sample of entries in the voucher
   register to the supporting documents. Which assertion would this test of controls most likely support?
   a. Completeness
   c. Valuation or allocation
   b. Existence or occurrence
   d. Rights and obligations

Answer 20

1. Decline to accept or perform the audit.
2. The audit procedures selected will achieve specific audit objectives.
3. Authorization of credit memos by personnel who receive cash may permit the misappropriation
   of cash.
4. A bank with which the entity is negotiating for a loan.
5. Existence or occurrence

Question 21

According to Section 9(A) of the IRR, the Commission upon the recommendation of the Board,
shall create an auditing standard setting body to be known as the
a. Auditing and Assurance Standards Council (AASC)
b. Auditing Standards and Practices Council (ASPC)
c. Auditing Standards Board (ASB)
d. Auditing Standards Council (ASC)

Answer 21

a. Auditing and Assurance Standards Council (AASC)

Question 22

24.The auditor’s risk assessment procedures should always include the following, except
a. Inquiries of management and of others within the entity
b. Analytical procedures
c. Observation and inspection
d. Substantive test procedures and tests of controls

25.The auditor’s risk assessment procedures
a. By themselves, do not provide sufficient appropriate audit evidence on which to base the audit
opinion
b. Should not consider information obtained from the auditor’s previous experience with entity
c. Are designed to detect material misstatement at the assertion level of classes of transactions,
account balances and disclosures
d. Are designed to test the effectiveness of the entity’s controls
26.Which of the following statements concerning audit risk and its components is incorrect?
a. Regardless of the assessed levels of inherent and control risks, the auditor should always
perform some substantive procedures for material account balances and classes of
transactions
b. The higher the assessment of inherent and control risks, the more evidence the auditor should
obtain from the performance of substantive procedures
c. The assessed level of inherent risk need not be considered in determining the nature, timing,
and extent of substantive procedures required to reduce audit risk to an acceptably low level
d. After obtaining an understanding of the accounting and internal control systems, the auditor
should make a preliminary assessment of control risk, at the assertion level, for each material account balance or class of transactions

Answer 22

24. Substantive test procedures and tests of controls
    25.By themselves, do not provide sufficient appropriate audit evidence on which to base the audit
    opinion
25. The assessed level of inherent risk need not be considered in determining the nature, timing,
    and extent of substantive procedures required to reduce audit risk to an acceptably low level

Question 23

28.An entity’s internal control system contains manual elements and often contains automated
elements. Manual elements in internal control may be less reliable than automated elements
because
a. Manual control elements can be more easily bypassed, ignored, or overridden and they also
more prone to simple errors and mistakes
b. Manual control elements facilitate the additional analysis of information
c. Consistency of application of manual control elements can always be assumed
d. Manual control elements include reliance on systems or programs that are inaccurately
processing data, processing inaccurate date, or both

29.Which of the following components of an entity’s internal control includes development and use of
training policies that communicate prospective roles and responsibilities to employees?
a. Monitoring of controls
c. Control environment
b. Control activities
d. Information and communication
30. Control activities relate to the following, except
a. Segregation of duties
b. Performance reviews
c. An internal audit function
d. Authorization

31.Internal control should be designed to provide reasonable assurance that
a. Management’s planning, organizing, and directing processes are properly evaluated
b. Management’s plans have not been circumvented by employee collusion
c. Material errors or fraud will be prevented, or detected and corrected within a timely period by
employees in the course of performing their assigned duties
d. The internal auditing department’s guidance and oversight of management’s performance is
accomplished economically and efficiently

Answer 23

28. Manual control elements can be more easily bypassed, ignored, or overridden and they also
    more prone to simple errors and mistakes
29. Control environment
30. An internal audit function
31. Material errors or fraud will be prevented, or detected and corrected within a timely period by
    employees in the course of performing their assigned duties

Question 24

34 The establishment of an overall audit strategy involves
I. Determining the characteristics of the engagement that define its scope
II. Ascertaining the reporting objectives of the engagement to plan the timing of the audit and the
nature of the communications required
III. Considering the important factors that will determine the focus of the engagement team’s
efforts.
a. I and II only c. I and III only
b. II and III only
d. I, II and III

35.Which of the following should be included in the audit plan?
I. The nature, timing and extent of planned risk assessment procedures, as determined under
PAS 315 (Identifying and Assessing the Risks of Material Misstatements trough Understanding
the Entity and its Environment)
II. The nature, timing and extent of planned further audit procedures at the assertion level, as
determined under PSA 330 (The Auditor’s Responses to Assessed Risks)
b. I only
c. Both I and II
c. II only
d. Neither I nor II

36.Which of the following matters would an auditor most likely consider when establishing the scope
of the audit?
a. The expected audit coverage, including the number and locations of the entity’s components to
be included
b. The entity’s timetable for r4epoting, such as at interim and final stages
c. The discussion with the status of audit work throughout the engagement and the expected
deliverables resulting from the audit procedures
d. Audit areas where there is a higher risk of material misstatement

Answer 24

34. I, II and III
35. Both I and II
36. The expected audit coverage, including the number and locations of the entity’s components to
    be included

Question 25

37.Audit programs are modified to suit the circumstances of particular engagements. A complete audit progr5am usually should be developed a. When the engagement letter is prepared b. After obtaining an understanding of the control environment and control activities components of the entity’s internal control c. After the auditor has obtained an understanding of the entity and its environment, including its internal control and assessed the risks of material misstatement d. Prior to beginning the actual audit work 38.In connection with the planning phase of an audit engagement, which of the following statements is always correct? a. Final staffing decisions must be made prior to completion of the planning stage b. Observation of inventory count should be performed at year-end c. A portion of the audit of a continuing audit client can be performed at interim dates d. An engagement should not be accepted after the client’s financial year-end 39.An adequate system of internal controls is most likely to detect a fraud perpetrated by a a. Group of employees in collusion b. Single employee c. Group of managers in collusion d. Single manager

Answer 25

37. After the auditor has obtained an understanding of the entity and its environment, including its internal control and assessed the risks of material misstatement 38.A portion of the audit of a continuing audit client can be performed at interim dates 39. Single employee

Question 26

40.Controls should be designed to provide reasonable assurance that a. Organizational objectives and goals will be achieved economically and efficiently b. Management’s plans have not been circumvented by worker collusion c. The internal audit activity’s guidance and oversight of management’s performance is accomplished economically and efficiently d. Management’s planning, organizing, and directing processes are properly evaluated 41.Criteria that are embodied in laws or regulations, or issued by authorized or recognized bodies of experts that follow a transparent due process are called a. Suitable criteria c. Specifically developed criteria b. Established criteria d. General criteria 42.In an assurance engagement, the outcome of the evaluation or measurement of a subject matter against criteria is called a. Subject matter information c. Assurance b. Subject matter d. Conclusion 43.The following are characteristics of “direct reporting” assurance engagements, except a. The subject matter information is in the form of an assertion by the responsible party that is made available to the intended users b. The subject matter information is provided to the intended users in the assurance report c. The practitioner either directly performs the evaluation or measurement of the subject matter or obtains a representation from the responsible party that has performed the evaluation or measurement d. The representation of the responsible party that has performed the evaluation or measurement of the subject matter is not available to the intended users 44.What type of assurance engagement is involved when the practitioner expresses a negative form of conclusion? a. Reasonable assurance engagement b. Negative assurance engagement c. Assertion-based assurance engagement d. Limited assurance engagement 45.Assurance engagement risk is the risk a. That the practitioner expresses an inappropriate conclusion when the subject matter information is materially misstated b. Of expressing an inappropriate conclusion when the subject matter information is not materially misstated c. Through loss from litigation, adverse publicity, or other events arising in connection with a subject matter reported on d. Of expressing an inappropriate conclusion when the subject matter information is either materially misstated or not materially misstated

Answer 26

40. Organizational objectives and goals will be achieved economically and efficiently 41. Established criteria 42. Subject matter information 43. The subject matter information is in the form of an assertion by the responsible party that is made available to the intended users 44. Limited assurance engagement 45. That the practitioner expresses an inappropriate conclusion when the subject matter information is materially misstated

Question 27

47.Reducing assurance engagement risk to zero is very rarely attainable or cost beneficial as a result of the following factors, except a. The use of selective testing b. The fact that much of the evidence available assurance knowledge is persuasive rather than conclusive c. The practitioner may not have the required assurance knowledge and skills to gather and evaluate evidence d. The use of judgment in gathering and evaluating evidence and forming conclusions based on that evidence 48.The Philippine Standards on Quality Control (PSQCs) are to be applied to a. Assurance engagements only b. Review engagements only c. Compilation and review engagements only d. All services that fall under the AASC’s engagement standards 49.The overall objectives of the auditor in conducting an audit of financial statements are I. To obtain reasonable assurance about whether the financial statements as a whole are free from material misstatements, whether caused by fraud or error II. To report on the financial statements III. To obtain conclusive rather than persuasive evidence IV. To detect all misstatements, whether due to fraud or error a. I and II only c. I, II and III only b. II and IV only d. I, II, III and IV

Answer 27

47. The practitioner may not have the required assurance knowledge and skills to gather and evaluate evidence 48. All services that fall under the AASC’s engagement standards 49. I and II only

Question 28

53.As defined in PSA 500, _________ is an individual or organization possessing the expertise in a field other than accounting or auditing, whose work in that field is used by the entity to assist the entity in preparing the financial statements a. Auditor’s experts c. Auditor’s internal expert b. Management’s expert d. Auditor’s external expert 54.Which of the following statements concerning the management’s expert’s competence, capabilities and objectivity is correct? a. Objectivity relates to the ability of the management’s expert to exercise the competence in the circumstances b. Competence relates to the possible effects that bias, conflict of interest or the influence of others may have on the professional or business judgment of the management’s expert c. Capability relates to the nature and level of expertise of the management’s expert d. The management’s expert’s competence, capabilities and objectivity are important factors in relation to the reliability of any information prepared by the management’s expert 55.Audit evidence is information used to draw reasonable conclusions on which to base the auditor’s opinion. Audit evidence is obtained by performing I. Risk assessment procedures II. Further audit procedures a. I only b. II only c. Either I or II d. Both I and II

Answer 28

53. Management’s expert 54. The management’s expert’s competence, capabilities and objectivity are important factors in relation to the reliability of any information prepared by the management’s expert 55. Both I and II

Question 29

Which of the following procedures would be most effective in reducing attestation risk? a) Discussion with responsible individuals. b) Examination of evidence. c) Inquiries of senior management. d) Analytical procedures.

Answer 29

Examination of evidence.

Question 30

85.) Which of the following is not a component of an entity's internal control? a) The control environment. b) Risk assessment. c) Information and communication. d) Control risk. 86.) Which of the following is responsible for establishing internal controls for a public company? a) Management. b) Management and auditors. c) Committee on Sponsoring Organizations. d) Financial statement auditors. 87.) The auditor's study of a public company's internal control is: a) Recommended by the PICPA. b) Required by GAAS. c) Required by PICAP. d) Required by the Sarbanes-Oxley Act. 88.) The auditor's study of a private company's internal control is: e) Recommended by the PICPA. f) Required by GAAS. g) Required by PICAP. h) Required by the Sarbanes-Oxley Act. 89.) Which of management's concerns with respect to implementing internal controls is the auditor primarily concerned? a) Reliability of financial reporting. b) Efficiency of operations. c) Compliance wit applicable laws and regulations. d) Effectiveness of operations. 90.) When an auditor attempts to understand the operation of the accounting system by tracing a few transactions through the accounting system, the auditor is said to be: a) Testing controls. b) Vouching. c) Tracing. d) Performing a walk-through

Answer 30

85. Control risk. 86. Management 87. Required by the Sarbanes-Oxley Act. 88. ) Required by GAAS. 89. Reliability of financial reporting. 90. Performing a walk-through

Question 31

91.) The primary emphasis by auditors by auditor when assessing internal control is on controls over: a) Account balances. b) Classes of transactions. c) Both A and B, because they are equally important. d) Both A and B, because they vary from client to client 92. Narrative, flowcharts, and internal control questionnaires are three common methods of: a) Documenting the auditor's understanding of internal controls. b) Designing the audit manual and procedures. c) Testing the internal controls. d) Documenting the auditor's understanding of the client's organizational structure. 93.) In obtaining an understanding of a manufacturing entity's internal control concerning inventory balances, an auditor most likely would a) Perform test counts of inventory during the entity's physical count. b) Analyze inventory turnover statistics to identify slow-moving and obsolete items. c) Review the entity's descriptions of inventory policies and procedures. d) Analyze monthly production reports to identify variances and unusual transactions 95.) After obtaining an understanding of internal control and assessing control risk, an auditor decide to perform tests of controls. The auditor most likely decided that a) It would be efficient to perform tests of controls that would result in a reduction in planned substantive tests. b) There were many internal control structure weaknesses that could allow errors in the accounting systems. c) Additional evidence to support a further reduction in control risk is not available. d) An increase in the assessed level of control risk is justified for certain financial statement assertions.

Answer 31

91. Classes of transactions 92. Documenting the auditor's understanding of internal controls. 93. Review the entity's descriptions of inventory policies and procedures. 95. It would be efficient to perform tests of controls that would result in a reduction in planned substantive tests

Question 32

98.) Risk assessment for financial reporting is management’s process for identifying, analyzing, and responding to risks relevant to the preparation of financial statements in conformity with: a) Generally Accepted Accounting Standards b) Generally Accepted Auditing Standards. c) PCAOB Auditing Standards. d) Generally Accepted Accounting Principles 99.) An auditor is currently assessing control risk and finds that it is lower than had been anticipated. How does this discovery impact the work of the auditor? a) The acceptable level of audit risk can be raised. b) The acceptable level of inherent risk can be lowered. c) The acceptable level of audit risk can be lowered. d) The acceptable level of detection risk can be raised

Answer 32

98. Generally Accepted Accounting Principles 99. The acceptable level of detection risk can be raised

Question 33

317. The principal purpose in conducting a study and evaluation of existing internal control system is a. For independent auditor to maintain a statement of independence in mental attitude in all matters relating the audit b. To assure compliance with GAAP c. To enable independent auditor to assess and be assured of management’s efficiency and effectivity d. To develop an audit plan and determine the nature, timing and extent of audit work required 318. Procedures directed toward obtaining evidential matter concerning the effectiveness of the deign or operation of an internal control structure policy or procedures are referred to as: a. Compliance tests b. Substantive tests c. Tests of controls d. Test of internal control structure elements

Answer 33

317. To develop an audit plan and determine the nature, timing and extent of audit work required 318. Tests of controls

Question 34

33. An auditor should not issue a report on a) Quarterly financial information b) Internal control c) Management performance d) The achievability of forecasts 34. Which of the following procedures would an auditor most likely perform to obtain evidence about the occurrence of subsequent events? a) Confirming a sample of material accounts receivable established after year-end b) Comparing the financial statements being reported on with those of the prior period c) Investigating personnel changes in the accounting department occurring after year-end d) Inquiring as to whether any unusual adjustments were made after year-end 35. To which of the following matters would materiality limits not apply when obtaining written client representations? a) Violations of state labor regulations b) Disclosure of line-of-credit arrangements c) Information about related party transactions d) Instances of fraud involving management 36. Who ultimately determines the scope of the audit? a) The auditor b) The client c) Both a and b d) Neither a nor b

Answer 34

33. The achievability of forecasts 34. Inquiring as to whether any unusual adjustments were made after year-end 35. Instances of fraud involving management 36. The auditor

Question 35

56. One reason why an auditor makes an analytical review of the client’s operations is to identify a) Improper separation of accounting and other financial duties b) Weakness of a material nature in the system of internal accounting control c) Unusual transactions d) Non-compliance with prescribed control procedures 57. Analytical procedures used in planning an audit should focus on identifying a) Material weaknesses in the internal control structure b) The predictability of financial data from individual transactions c) The various assertions that are embodied in the financial statements d) Areas that may represent specific risk relevant to audit

Answer 35

56. Unusual transactions 57. Areas that may represent specific risk relevant to audit

Question 36

13. This is the susceptibility of an account balance or class of transactions to misstatement that could be material, individually or when aggregated with misstatements in other balances or classes, assuming there are no related internal controls A. Inherent risk B. Control Risk C. Audit Risk D. Information risk 17. The risk of material financial misstatement may be greater when the following conditions exist, EXCEPT : A. When there is sufficient personnel with appropriate accounting and financial reporting skills B. When there is greater management intervention to specify accounting treatment C. Complex transactions or accounting principles is involved D. When there is greater manual intervention for data collection and processing 21. Policies and procedures to ensure that necessary actions are taken to address risks to the achievement of preparing reliable financial statements pertaining to performance of physical controls and segregation of duties. A. Control environment B. Control activities C. Monitoring D. Information and communication 22. Applicable Principles relating to the Components of Internal Control :  Demonstrate a commitment to integrity and ethical values. A. Risk assessment B. Information and communication C. Control Environment D. Monitoring 23. The process an entity uses to assess the quality of internal control over time. A. Monitoring B. Control environment C. Control activities D. Information and communication 24. Applicable Principles relating to the Components of Internal Control :  Considers the potential for fraud in assessing risks to the achievement of the corporate objectives A. Control activities B. Monitoring C. Information and Communication D. Risk assessment

Answer 36

13. Inherent risk 17. When there is sufficient personnel with appropriate accounting and financial reporting skills 21. Control activities 22. Control Environment 23. Monitoring 24. Risk assessment