Acc302 course, arab open university lebanon, from book principles of auditing and other assurance services(whittington pany)

Question 4: (25 marks) Management of Mango Company is responsible for designing and maintaining its business's internal control system. In designing the internal control, the management of Mango company considered the ve major control components: the control environment, risk assessment, the accounting information system, control activities and monitoring. Required: a. Explain how risk assessment contributes to effective internal control and identify four factors that result in increased nancial reporting risk. (15 marks) b. Describe the purpose of the following two types of control activities: (i) Performance reviews (5 marks) (ii) Transaction processing