C213 Accounting for Decision Makers
Competency: Internal Controls Topic: Internal Controls

Definitions

1. Errors- result when unintentional mistakes are made in recording transactions, posting transactions, summarizing accounts, and so forth.
2. Disagreement- result when different people arrive at different conclusions based on the same set of facts.
3. Frauds- result of intentional errors. Fraudulent financial reporting occurs when management chooses to intentionally manipulate the financial statements to service around.
4. Control environment- consists of the actions, policies, and procedures that reflect the overall attitudes of top management, the directors, and the owners about control and its importance to the company.
5. Control activities- Control activities or...