1. What are the key considerations when evaluating the severity of a deficiency in a control that directly addresses a risk of material misstatement?

2. Does the Assistant Controller's failure to adequately review the Vendor Change Form represent a deficiency in the design or operating effectiveness of the control?

3. Is the failure in the vendor request change form control indicative of a material weakness in internal control over financial reporting?

4. Would the deficiency warrant disclosure in the Company's Form 10-K, Item 9A? If so, what information would the Company be expected to disclose?

5. What implications does the deficiency have on other direct or indirect controls?

Link to case and handout

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