1.Which of the following pairs of duties combines the functions of custody and authorization in a manner that would allow an employee to conceal the theft of a customers payment?

a)Handling cash receipts plus maintaining accounts receivable

b)Writing checks plus reconciling the bank statement

c)Handling cash receipts plus issuing credit memos

d)All of the combinations involve custody and authorization in a manner that would enable an employee to conceal theft of a customers payment

e)None of the combinations involve the functions of custody and authorization in a manner that would enable an employee to conceal theft of a customers payment

2)Which of the following violates proper segregation of duties?

a)The same person maintains both accounts receivable and accounts payable.

b)The same person approves sales orders that exceed a customers credit limit and processes and reconciles the bank account.

c)The same person handles customer payments and has access to blank checks.

d)All of the above combinations violate proper segregation of duties.

e)None of the above combinations violate proper segregation of duties

3)Which of the following types of fraud requires access to the accounts receivable master file?

a)Lapping

b)Kiting

c)Theft of inventory

d)None of the above

4)The CEO is concerned about the possibility of employees stealing inventory. In the formal language used for risk analysis, theft of inventory is referred to as a(n) .

a)risk

b)exposure

c)expected loss

d)threat

e)none of the above

5)For good internal control in an ERP system, sales staff should be permitted to .

a)adjust customer credit limits

b)issue credit memos

c)both of the above

d)neither of the above