chp 7 accounting – Flashcards

The organizational plan and all related measures that safeguard assets, encourage employees to follow company polices, promote operational efficiency, and ensure accurate and reliable accounting data.

Component of internal control that helps ensure business goals are achieved.

Limits access to a local network.

Rearranges data by a mathematical process.

To establish one, a company's CEO and top managers must behave honorable to set a good example for employees.

Without a sufficient one of these, information cannot properly be gathered and summarized.

Example: The person who opens the bank statement should not also be the person who is reconciling cash.

Two or more people working together to overcome internal controls.

Should be pre-numbered to prevent theft and inefficiency.

Examination of a company's financial statements and accounting system by a trained accounting professional.

Part of internal control that ensures resources are not wasted.

Identification of uncertainties that may arise due to a company's products, services, or operations.

Requires companies to review internal control and take responsibility for the accuracy and completeness of their financial reports.