Cassandra Corporation, a manufacturing company, periodically invests large sums in marketable equity securities. The investment policy is established by the investment committee of the board of directors. The treasurer is responsible for carrying out the committee's directives. All securities are held by Cassandra's brokerage company. Your internal control questionnaire with respect to Cassandra's investments in equity securities contains the following three questions:

1. Is investment policy established by the investment committee of the board of directors?

2. Is the treasurer solely responsible for carrying out the investment committee's directive?

3. Are all securities stored in a bank safety deposit box? Required:

a. What is the purpose of the above three questions?

b. What additional questions should your internal control questionnaire include concerning the company's investment in marketable equity securities? (Hint: Prepare questions to cover the control objectives validity, completeness, authorization, accuracy, classification, and proper period.

This is an auditing question-