3. The following situations suggest a strength or a weakness in internal control * Click the icon to view the situations.) Read the requirements Requirement 1. Define internal control Internal control is (1) and all the related measures designed to do the following: (Only complete the necessary answer boxes.) Requirement 2. The system of internal control must be tested by external a s what or rule requires this testing The (8) requires the system of internal control to be tested by external auditors. Requirement 3. Identify each item as either a strength or a weakness in internal control and give your reason for each answer. a. Top managers delegate all internal control procedures to the accounting department. (9) (10) b. Accounting department staff (or the bookkeeper) orders merchandise and approves invoices for payment c. Cash received over the counter is controlled by the sales clerk, who rings up the sale and places the cash in the register The sales clerk matches the total recorded by the register to each day's cash sales. (13) (14) d. The employee who signs checks need not examine the payment packet because he is confident the amounts are corre (15) (16) 4: More Info a. b. Top managers delegate all internal control procedures to the accounting department Accounting department staff for the bookkeeper) orders merchandise and approves invoices for payment Cash received over the counter is controlled by the sales clerk, who rings up the sale and places the cash in the register. The sales clerk matches the total recorded by the register to each day's cash sales The amoloyee who signs checks need not examine the payment packet because he is confident the amounts are correct d. 5: Requirements 2. 3. The system of internal control must be tested by external auditors. What law or rule requires this testing Identify each item as either a strength or a weaknees in internal control and give your reason for each ansv (1) O a generally accepted accounting principle O a state law O the organizational plan (2) O Encourage employees to follow company policy O Ensure accurate and reliable accounting records Increase revenues Safeguard assets Safeguard employees Maximize profits O Promote customer loyalty Promote employee loyalty O Promote operational efficiency (3) O O Encourage employees to follow company policy O Ensure accurate and reliable accounting records Increase revenues Safeguard assets Safeguard employees O Maximize profits O Promote customer loyalty Promote employee loyalty O Promote operational efficiency O Maximize profits Encourage employees to follow company policy O Promote customer loyalty O Ensure accurate and reliable accounting records O Promote employee loyalty Increase revenues Promote operational efficiency Safeguard assets Safeguard employees O O Encourage employees to follow company policy Ensure accurate and reliable accounting records Increase revenues Safeguard assets Safeguard employees O Maximize profits Promote customer loyalty O Promote employee loyalty O Promote operational efficiency Encourage employees to follow company policy Ensure accurate and reliable accounting records Increase revenues Safeguard assets Safeguard employees Maximize profits Promote customer loyalty O Promote employee loyalty O Promote operational efficiency