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An audit committee should be comprised of which group of people?

	a.	external auditors
	b.	operating executives
	c.	officers in the company
	d.	independent board members

multiple answer question

Select all the correct statements about external auditors:

	a.	They must have a CPA designation.
	b.	They guarantee that an organization's financial statements are correct.
	c.	They examine an organization's financial statements to determine if those statements are prepared in accordance with GAAP.
	d.	They assure investors that the company they audited is a good investment.

Which of the following was not a mandate of Sarbanes Oxley?

	a.	Requirement of all publicly traded companies to provide a report on the condition of the company's internal control over the financial reporting process.
	b.	The creation of an organization to monitor the quality of audits performed by independent auditors.
	c.	Auditors could no longer provide consulting services to their audit clients.
	d.	The audit committee of the Board of Directors has to vouch for the reliability of the company's financial statements.

ProdCo is seeking a bank loan, and provides its statement of cash flows. What is the most important relation the bank will examine?

	a.	financing cash flows
	b.	net change in cash
	c.	free cash flows
	d.	operating cash flows

multiple answer question

What does an external auditor do? Select all the correct answers.

	a.	They create an internal control system for companies they audit.
	b.	They do observations within the organization they audit.
	c.	They do confirmations, which are third-party verifications.
	d.	They interview people within the organization they audit to understand the company's internal processes.

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