1. Presented below are descriptions of specific existing control activities. Determine whether each description is an example of:

• Proper Use of Documentation
• Prenumbering of Documents
• Authorization of Transactions
• Independent Checks of Performance
• Timely and Appropriate Performance Reviews
• Information Systems Controls
• Physical Controls
• Segregation of Duties

A. The information security officer assigns user accounts and passwords to new employees upon notification from the human resource department.

B. An independent person accounts for the numerical sequence of all sales invoices used in the month of October to ensure that all sales were properly recorded.

C. An adjustment to a customer account receivable balance must be supported by a credit memo.

D. The assistant credit manager reviews and approves all new sales for credit prior to their processing for shipment and signs the orders to indicate her approval.

E. The assistant controller approves invoices for recording and payment; the accounts payable clerk records the payable and purchase; the treasurer signs and mails the checks to vendors.

F. The sales manager meets with members of the sales team on a weekly basis to review their progress toward monthly sales goals.

G. The assistant controller verifies the overhead allocations computed by the cost accounting clerk prior to their entry into the accounting system.

H. The organization's main servers are kept in secure area that can only be entered with a valid key card.

2. A deficiency that implies that there is a reasonable possibility of a misstatement in the financial records that would materially affect financial reporting:

A. A material weakness.

B. A significant deficiency

C. A probable deficiency

D. An insignificant deficiency