Principles of Accounting I

ACC/290 Principles of Accounting I

(8 questions 100 word answers)

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1.     1. What is fraud and how does it occur?  Within your discussion, incorporate the fraud triangle.  There are three elements to the fraud triangle.  Fraud will occur if at least two of those elements are present.  Provide an example of fraud you have either witnessed from your work or heard about in the news and indicate which two elements of the fraud triangle were present in the situation.



2.   22. How have the new rules in the Sarbanes-Oxley Act of 2002 affected the way accounting departments and companies operate? What are some positive outcomes from these changes?



3.     3. The Six principles of control activities are: 1) Establishment of responsibility, 2) Segregation of duties, 3) Documentation procedures, 4) Physical controls, 5) Independent internal verification, 6) Human resource controls.  Pick one of the control activities and describe why it is important.  Provide an example of this in your workplace or where it should be implemented in your workplace.



4.     4. Now that we have looked at the six principles of control activities, let’s apply that to the internal controls surrounding cash receipts.   Pick a control activity for cash receipts and describe in detail how it helps to prevent fraud.



5.     5. Discuss how the Sarbanes‐Oxley Act has increased the importance of internal control to top managers of a company.



6.     6. How do documentation procedures contribute to good internal control? What internal control objectives are met by physical controls?



7.     7. Explain the control principle of independent internal verification. What practices are important in applying this principle?



8.     8. How do these principles, (a) Physical controls and (b) Human resource controls.        apply to cash disbursements?


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