CFC Internal Controls & Compliance

Question 1

What is the primary purpose of internal controls?

Accepted Answer

Safeguard assets and ensure accuracy

Answer

To increase profits

Answer

Reduce employee numbers

Answer

Eliminate audits

Question 2

Which control involves separating duties to reduce fraud risk?

Accepted Answer

Segregation of duties

Answer

Authorization control

Answer

Physical controls

Answer

Reconciliation

Question 3

What is a key component of compliance?

Accepted Answer

Following laws and policies

Answer

Ignoring regulations

Answer

Reducing reporting

Answer

Avoiding audits

Question 4

What is an example of a physical control?

Accepted Answer

Locks and safes

Answer

Authorization procedures

Answer

Employee training

Answer

Financial reporting

Question 5

How does reconciliation help internal controls?

Accepted Answer

Detect and correct errors

Answer

Create discrepancies

Answer

Avoid audits

Answer

Authorize transactions

Question 6

What role do policies and procedures play in compliance?

Accepted Answer

Provide a framework for compliance

Answer

Cause confusion

Answer

Reduce efficiency

Answer

Replace internal controls

Question 7

Why is monitoring important in internal controls?

Accepted Answer

Detect issues and improve controls

Answer

Ignore control failures

Answer

Reduce documentation

Answer

Limit audits

Question 8

What is fraud risk assessment?

Accepted Answer

Evaluating and preventing fraud risk

Answer

Ignoring fraud

Answer

Reporting fraud after occurrence

Answer

Eliminating internal audits

Question 9

How can technology enhance internal controls?

Accepted Answer

Improve accuracy and monitoring

Answer

Replace human oversight completely

Answer

Increase errors

Answer

Ignore compliance