1. To protect its assets and accounting information, a company should a. give one person sole responsibility...

Question:

1. To protect its assets and accounting information, a company should
a. give one person sole responsibility for the accounting system.
b. control access to its networks and databases.
c. permit access to accounting records only by top managers.
d. hire only employees with college degrees.

2. The purpose of an auditors’ report is to show that
a. a CPA has prepared the company’s all of the company’s transactions have been inspected for accuracy.
c. an independent party believes that the do not contain any significant errors.
d. the company is healthy, profitable, and likely to remain that way into the foreseeable future.

3. An organization’s plan and the procedures used to safeguard assets ensure accurate information, promote efficiency, and encourage adherence to policies is its
a. internal control system.
b. cost accounting system.
c. financial accounting system.
d. management information system.

4. An auditors’ report made by an independent accounting firm
a. is addressed to a company’s managers.
b. must contain only three paragraphs.
c. is dated at the date of the audited identifies the responsibilities of the auditor.

5. The Securities and Exchange Act of 1934 established the
a. FTC.
b. SEC.
c. FASB.
d. GAO.

6. A 10-K report is
a. a quarterly financial report for the SEC.
b. a registration for a new stock issue with the SEC.
c. an annual financial report for the SEC.
d. a report of change in auditors for the SEC.

7. Financial accounting standards for businesses currently are established in the United
States primarily by the
a. Federal Accounting Standards Board.
b. Financial Accounting Standards Board.
c. Securities and Exchange Commission.
d. Accounting Principles Board.

8. All of the following are qualitative characteristics of financial reporting except
a. relevance.
b. reliability.
c. representational faithfulness.
d. conservatism.

9. The Governmental Accounting Standards Board (GASB) sets standards for
a. not-for-profit organizations.
b. state and local governments.
c. state and federal governments.
d. the federal government.

10. The FASB releases the following document(s) as part of creating new standards.
a. discussion memorandum
b. exposure draft
c. b only
d. a and b

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