Financial Accounting Sample Questions (2) [DocGiant]
1. Briefly define five components of internal control, MICER.
1. “Monitoring of Controls” – Companies hire internal and external auditors to monitor
and evaluate their internal controls. ) Internal auditors monitor company controls to
safeguard assets, and external auditors evaluate the controls
2. “Information System” – Internal controls within the information system must be
present to insure that only authorized users can access various parts of information
3. “Control Procedures” – Control procedures help to ensure that a business’s goals are
4. “Control Environment” – A tone of respect must be set by senior management for the
system of internal controls to help ensure widespread compliance.
5. “Risk Assessment” – A system of internal controls must factor in the risk associated
with various aspects of the business and the individual accounts. Where risk is
determined to be higher, greater internal control is required. A pharmaceutical
company testing drugs to determine possible side effects is an