Practice Test Geeks(CCS) Certified Compliance Specialist Practice Test
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Internal Controls & Auditing Flashcards

7 cards from real CCS practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Internal Controls & Auditing flashcards as text

  1. Which COSO component addresses the organization's values, ethics, and commitment to competence?

    Answer: Control Environment

    The Control Environment is the foundation of COSO's Internal Control framework and sets the tone at the top regarding ethics, integrity, and competence.

  2. A compliance officer discovers that a control designed to prevent duplicate payments has a 15% failure rate. What should be the FIRST step?

    Answer: Perform a root cause analysis

    Root cause analysis should precede corrective action to ensure the remediation addresses the actual source of the control failure.

  3. Under the Sarbanes-Oxley Act Section 404, management is required to:

    Answer: Assess and report on the effectiveness of internal controls over financial reporting

    SOX Section 404 requires management to assess and report on the effectiveness of internal controls over financial reporting as part of the annual report.

  4. Which type of audit evidence is generally considered MOST reliable?

    Answer: Documents obtained directly from independent third parties

    Evidence obtained directly from independent third parties is most reliable because it is least susceptible to management influence or manipulation.

  5. In the context of internal auditing, 'inherent risk' refers to:

    Answer: Risk existing before any controls are applied

    Inherent risk is the susceptibility of an assertion or process to material error before considering any related controls.

  6. Which sampling technique gives every item in a population an equal chance of being selected?

    Answer: Random sampling

    Random sampling ensures each item in the population has an equal and independent probability of selection, supporting statistically valid conclusions.

  7. An auditor finds that the same employee who approves purchase orders also processes the payment. This is an example of:

    Answer: A segregation of duties weakness

    Combining authorization and custody/payment functions in one person violates segregation of duties principles and creates an opportunity for fraud.