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During the course of an audit of Gaby, Inc., Emilio CPAs identified various issues. Some...

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Accounting

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During the course of an audit of Gaby, Inc., Emilio CPAs identified various issues. Some issues may be related to internal controls (1/C), and others may not. Select from the option list provided whether each issue is an 1/C design weakness, I/C operational failure, or not an 1/C issue. Each answer may be used once, more than once, or not at all. Issue Answer E 1. Emilio determined that segregation of duties regarding cash collection was inadequate. 2. Gaby's internal control system did not consistently perform reconciliations of significant accounts. 3. Emilio observed an excessive deviation rate in the test of controls over credit authorization. 4. After working with the internal auditors and management, Emilio determined that employees and management lack the proper qualifications and training. 5. Emilio determined that sales had decreased significantly due to a downturn in the economy. 6. When observing inventory, Emilio noticed that the warehouse remains unlocked and unguarded, even at night. 11 n Select an option below th O I/C design weakness O V/C operational failure 5 Not an I/C issue an t th eve RESET CANCEL

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