CDFM Auditing and Internal Controls 4

Question 1

Which assertion tested during a financial statement audit addresses whether all transactions and accounts that should be recorded have actually been recorded?

Accepted Answer

Completeness

Answer

The completeness assertion ensures that all transactions and balances that should be included in the financial statements are not omitted.

Question 2

Under DoD's audit readiness initiatives, which framework is used to assess the maturity of financial management business processes?

Accepted Answer

Financial Improvement and Audit Readiness (FIAR) Methodology

Answer

The FIAR Methodology provides DoD components with a structured approach to improve financial management processes and achieve audit readiness.

Question 3

When assessing control risk in a DoD audit, what does a higher assessed control risk indicate?

Accepted Answer

Internal controls are less effective at preventing or detecting misstatements

Answer

Higher control risk means controls are less reliable, requiring the auditor to perform more extensive substantive procedures to obtain sufficient audit evidence.

Question 4

Which type of audit sampling approach allows every item in the population an equal chance of selection, without using any structured interval or stratification?

Accepted Answer

Simple random sampling

Answer

Simple random sampling gives every item in the population an equal probability of selection, making it a statistically valid method for projecting results.

Question 5

A DoD component finds that its accounting system cannot produce reliable data for year-end closing. This represents a weakness in which COSO component?

Accepted Answer

Information and Communication

Answer

The Information and Communication component addresses whether relevant, quality information is captured and communicated to support financial reporting and decision-making.

CDFM - Certified Defense Financial Manager Practice Test

CDFM - Certified Defense Financial Manager Practice Test

CDFM Auditing and Internal Controls 4