CGFM Internal Controls and Government Auditing 2

Question 1

Which federal law established Chief Financial Officers (CFOs) in major federal agencies and required audited financial statements?

Accepted Answer

Chief Financial Officers Act of 1990

Answer

Government Performance and Results Act of 1993

Answer

Federal Financial Management Improvement Act of 1996

Answer

Accountability of Tax Dollars Act of 2002

Question 2

What is the primary objective of a 'performance audit' in government?

Accepted Answer

Providing an independent assessment of program economy, efficiency, and effectiveness

Answer

Expressing an opinion on financial statements

Answer

Detecting fraud and improper payments

Answer

Verifying compliance with appropriations law

Question 3

What is an 'attestation engagement' under government auditing standards?

Accepted Answer

An engagement in which the auditor issues a report on subject matter or assertions made by another party

Answer

A commitment by auditors to find fraud

Answer

A contract between the government and an audit firm

Answer

An agreement to provide consulting services

Question 4

Under OMB Circular A-123, what is the primary management tool for federal agencies regarding internal controls?

Accepted Answer

The agency's annual assurance statement on internal controls and financial systems

Answer

The President's Management Agenda

Answer

The Inspector General's semiannual report

Answer

The agency's strategic plan

Question 5

What is the role of Inspectors General (IGs) in the federal government?

Accepted Answer

Conducting independent audits, investigations, and inspections to prevent and detect fraud, waste, and abuse

Answer

Setting accounting standards for federal agencies

Answer

Approving agency budgets before submission to OMB

Answer

Certifying financial statements for the financial report

Question 6

What does 'segregation of duties' mean in the context of internal controls?

Accepted Answer

Dividing key tasks among multiple individuals so no single person controls all aspects of a transaction

Answer

Separating federal employees by security clearance level

Answer

Assigning different auditors to different agencies

Answer

Separating budget execution from budget formulation