Tommy Company, a regional retailer of fencing and other lumber products is being audited by their external auditors, Bolt CPA Firm.

After some problems last year, the auditors are particularly interested in auditing the clients system of internal control. The auditors

observe that for the client's revenue and receivable cycle transactions, the orders are entered into the system, the system processes

the orders, and then exception reports are generated for any orders with issues which are flagged for further review. Based on this

information, what types of internal controls has the client deployed?

O The client's exception reports represent an example of input controls, and the processing system itself represents an

example of an IT general control.

The client is using entity$-$level controls to ensure the processing system is operating effectively. The client is also using an IT

general control in the exception reports.

O Both the effective and efficient processing of sales transactions represent IT general controls, and the exception reports the

system is generating would represent an example of an entity$-$level control.

The client appears to be utilizing IT general controls in the processing system, and an example of an output control would be

when an exception report is generated.

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