Term
| Enterprise Risk Management (ERM) |
|
Definition
| process by which the company identifies potential events that may affect the company, manage the risk to an acceptable level, and to provide reasonable assurance regarding the achievement of the company’s goals. |
|
|
Term
|
Definition
1.Internal Control
2.Objective Setting
3.Event Identification
4.Risk Assessment
5.Risk Response
6.Control Activities
7.Information & Communication
8.Monitoring |
|
|
Term
|
Definition
| Risk can never be completely eliminated, but it can be reduced to a level considered acceptable by Management |
|
|
Term
| Why are Internal Controls put in place? |
|
Definition
| reduce errors and reduce the possibility of fraud |
|
|
Term
|
Definition
| the potential financial effect times the probability of occurrence. |
|
|
Term
| Enterprise Risk Management (ERM) |
|
Definition
| process by which the company identifies potential events that may affect the company, manage the risk to an acceptable level, and to provide reasonable assurance regarding the achievement of the company’s goals. |
|
|
Term
|
Definition
1.Internal Control
2.Objective Setting
3.Event Identification
4.Risk Assessment
5.Risk Response
6.Control Activities
7.Information & Communication
8.Monitoring |
|
|
Term
|
Definition
| Risk can never be completely eliminated, but it can be reduced to a level considered acceptable by Management |
|
|
Term
| Why are Internal Controls put in place? |
|
Definition
| reduce errors and reduce the possibility of fraud |
|
|
Term
|
Definition
| the potential financial effect times the probability of occurrence. |
|
|
Term
|
Definition
1.Employee theft for personal gain
2.Employee-outsider theft resulting from an employee in collusion with an outsider
3.Management fraud concerns diversion of assets or misrepresentation of assets by management |
|
|
Term
| internal control is built on 2 premises |
|
Definition
1.Responsibility
2.Reasonable Assurance |
|
|
Term
|
Definition
| Management weighs out the costs versus benefits of implementing internal controls |
|
|
Term
|
Definition
| Management and the Board of Directors are responsible for maintaining a strong control environment |
|
|
Term
| Sarbanes-Oxley Act of 2002 (SOX) section 404 says? |
|
Definition
| requires Management to annual provide an internal control report |
|
|
Term
|
Definition
| sets the tone of the organization |
|
|
Term
|
Definition
| the process of identifying, analyzing, and managing risks to meet the company’s objectives/goals |
|
|
Term
|
Definition
| policies and procedures, established by Management, to ensure that the objectives of the Company are met |
|
|
Term
|
Definition
| to reduce opportunity to allow any person to be in a position to both perpetrate and conceal errors or irregularities |
|
|
Term
| 3 steps to accomplish segregation of duties |
|
Definition
1.Authorization of transactions
2.Recording of transactions
3.Maintaining custody of assets |
|
|
Term
| Information & Communication |
|
Definition
| Information refers to the organization’s accounting system, while communication refers to the clear understanding of policies and procedures |
|
|
Term
|
Definition
| on-going assessment of controls over time and the taking corrective actions when necessary |
|
|
Term
|
Definition
| prevent errors and fraud before they happen |
|
|
Term
|
Definition
| uncover errors and fraud after they have occurred |
|
|
Term
|
Definition
|
|
Term
|
Definition
| agreement or conspiracy among two or more people to commit fraud |
|
|
