Fichas
Chapter 4
Fichas del conjunto (19)
- 1Reasons for Incorrect Financial Statement1. Errors
2. Fraud - 2Define Fraud:Fraud—a person intentionally deceives another person for personal gain or to damage that person
- 3Occupational fraud:the use of one’s occupation for
personal enrichment through the
deliberate misuse or
misapplication of the
employer’s resources - 4The Fraud Triangle:1. Opportunity
2. Motivation
3. Rationalization - 5Define Opportunity in the Fraud Trianglethe situation allows the fraud to occur.
- 6Define Motivation in the Fraud Trianglesomeone feels the need to commit
fraud, such as the need for money. - 7Define Rationalize in the Fraud Trianglejustification for the deceptive act
by the one committing the fraud. - 8Internal Control:attempt to eliminate the opportunity element of fraud
- 9Internal controls represent plans to:- Safeguard the company’s assets
- Improve the accuracy and
reliability of accounting
information - 10Sarbanes-Oxley Act of 2002:Also known as the Public Company - ----Accounting Reform and Investor Protection Act of 2002
Applies to all companies that are required to file financial statements with the SEC
Established guidelines related to:
Internal control procedures
Auditor-client relations - 11Control activitiesare the policies and procedures that
help ensure that management’s
directives are being carried out. - 12Risk assessmentidentifies and analyzes internal and external risk factors that could
prevent a company’s objectives from
being achieved. - 13Slide 18 & 19kc;lmdsc;lamdsc
- 14CEO and CFO:Sign a report each year certifying adequacy of internal controls
- 15Auditors:- Provide an opinion on management’s assessment of internal control over financial reporting
- Provide their own opinion on
company’s internal control over
financial reporting - 16Internal control systems are especially susceptible to:Collusion
- 17Define Collusion:two or more people acting together to circumvent internal controls
- 18Bank reconciliationmatches the balance of cash in the
bank account with the balance of cash
in the company’s own records - 19Timing differencesoccur when the company records transactions either before or after the
bank records the same transactions
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- Accounting Fichas sobre Chapter 4 , creado por Arturo Alaniz el 24/09/2018.
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- Arturo Alaniz
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