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Study Resources (Accounting)

- CHAPTER 7 – PROBLEMS 174. Match the standard-setting bodies with their purpose. 175. Identify whether the following audit tests are used to evaluate internal access controls (I), external access controls (E), or both (B): authenticity, penetration, vulnerability assessments, review of access logs, and review of policies concerning the issuance of passwords and security tokens. 176..
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155. There are four methods of system conversion; parallel, direct cutover, pilot, and phase-in. Describe these four methods and how they differ.  156. Operation and maintenance is the longest and costliest part of the SDLC.  Describe why this would be true.  157. Describe how IT performance reports are important in IT Governance. .
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130.Which of the following audit procedures is most likely to be performed during the planning phase of the audit? A.Obtain an understanding of the client’s risk assessment process. B.Identify specific internal control activities that are designed to prevent fraud. C.Evaluate the reasonableness of the client’s accounting estimates. D.Test the timely cutoff of cash payments.
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136. What is the advantage of studying the current system within the Systems Analysis phase?  137. During the systems analysis phase, which two data collection methods help determine user requirements?  138. What are the advantages of purchased software when compared to software developed in- house?  139. Why might it be important follow.
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- CHAPTER 6 – END OF CHAPTER QUESTIONS: 119.IT governance includes all but which of the following responsibilities? A.Aligning IT strategy with the business strategy B.Writing programming code for IT systems C.Insisting that an IT control framework be adopted and implemented D.Measuring IT’s performance 120.Which phase of the system development life cycle includes determining user needs.
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107.This is one of the computer-assisted audit techniques, related to processing controls, that involves processing client data through a controlled program designed to resemble the client’s application.  This test is run to find out whether the same results are achieved under different systems. A.Integrated Test Facility B.Embedded Audit Module C.Parallel Simulation D.Test Data Method 108.Regardless.
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- CHAPTER 6 – SHORT ESSAY 151. Describe the role that the Board of Directors should play in IT governance.  152. Two feasibility studies occur during the SDLC; one during Systems Planning, and one during Systems Design.  Describe the differences between these two feasibility studies.  153. There are four methods of data.
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41.Software should never be implemented before it is tested. 42.It is essential that accountants oversee the data conversion from the old system to the new system to make sure that all accounting data is completely and correctly converted. 43.The file or database storage for the new accounting system may not be different.
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81.The purpose of this step in the systems analysis phase is to determine whether the problem or deficiency in the current system really exists and to make a “go” or a “no-go” decision. A.Survey of the Current System B.Determination of User Information Needs C.Business Process Reengineering D.Preliminary Investigation 82.A detailed study of the current system.
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- CHAPTER 5 – SHORT ESSAY 131. Why are shareholders sometimes considered internal stakeholders and sometimes considered external stakeholders? 132. Is it possible for financial information to be accurate but not transparent?  Similarly, is it possible for financial information to be transparent but not accurate?  Explain. 133. Earnings management involves lying about the.
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- CHAPTER 6 – SHORT ANSWER QUESTIONS 131. At the beginning of the chapter, the real world example of Allstate’s IT expenditure is mentioned.  Prior to the implementation of their IT Governance Committee, "whoever spoke the loudest or whoever had the biggest checkbook," got to select IT Projects.  What do you think.
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77.Although there a number of organizations that provide detailed guidance, it is still necessary for auditors to rely on other direction regarding the types of audit tests to use and the manner in which the conclusions are drawn.  These sources of information include: A.Industry Guidelines B.PCAOB C.ASB D.ASACA 78.Claims regarding the financial condition of the.
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31.In general, purchased software is more costly but more reliable than software designed in-house. 32.While it is not necessary to hire a consulting firm, many organizations find that the special expertise of consulting firms is most beneficial in the design and implementation of accounting system software. 33.When in the systems design phase.
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57.This type of audit is performed by independent auditors who are objective and neutral with respect to the company and the information being audited. A.Compliance Audit B.Operational Audit C.Internal Audit D.External Audit 58.The independence of a CPA could be impaired by: A.Having no knowledge of the company or the company management B.By owning stock of a similar.
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160. Blutarch MultiMedia Stop is a regional retailer of consumer electronics with warehouses and stores located in several large cities in California.  The board and top management of Blutarch are considering updating their accounting, inventory, and retail sales software and hardware.  Their current systems are approximately 15 years old.  Assume that you.
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91.The many sets of activities within the organization performed to accomplish the functions necessary to continue the daily operations are referred to as: A.Business Systems B.Business Processes C.Business Activities D.Business Functions 92.The systems analysis report, which is sent to the IT governance committee, will inform the committee of all of the following, except: A.The results of.
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71.The process of designing the outputs, inputs, user interfaces, databases, manual procedures, security and controls, and documentation of the new system is referred to as: A.Conceptual Design B.Software Selection C.Systems Design D.Detailed Design 72.When attempting to prioritize IT projects, the IT governance committee needs to consider: A.The assessment of IT systems and their match to strategic.
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61.The study of the current system to determine the strengths and weaknesses and the user needs of that system is called: A.Systems Analysis B.Systems Design C.Systems Planning D.Systems Implementation 62.This phase of SDLC requires the collection of data about the system and the careful scrutiny of those data to determine areas of the system that.
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- CHAPTER 6 - MULTIPLE CHOICE 51.The process of determining the strategic vision for the organization, developing the long-term objectives, creating the strategies that will achieve the vision and objections, and implementing those strategies is referred to as A.IT Governance B.Strategic Governance C.Strategic Management D.IT Management 52.A structure of relationships and processes to direct and control.
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11.The remoteness of information, one of the causes of information risk, can relate to geographic distance or organizational layers. 12.The most common method for decision makers to reduce information risk is to rely on information that has been audited by an independent party. 13.Auditors have the primary responsibility to make sure that.
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161. Assume that you are the project team manager that is engaged in a Systems Analysis.  The company is a large, national retailer with several stores and warehouses located throughout the United States.  The corporate headquarters are in Atlanta, Georgia, and substantially all major accounting takes place at the corporate headquarters.  Describe how.
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21.Risk can be inherent in the client’s business, due to things such as the nature of operations, or may be caused by weak internal controls. 22.Auditors do not need to concern themselves with risks unless there is an indication that there is an internal control weakness. 23.The auditor’s understanding of internal controls.
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97.  Related audit tests to review the existence and communication of company policies regarding important aspects of IT administrative control include all of the following, except: A.Personal accountability and segregation of incompatible responsibilities B.Job description and clear lines of authority C.Prevention of unauthorized access D.IT systems documentation 98.Controls meant to prevent the destruction of information.
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146. Explain how an audit trail might get “lost” within a computerized system.  147. Explain how the presence of IT processes can improve the quality of information that management uses for decision making.  148. Distinguish among the focuses of the GAAS standards of fieldwork and standards of reporting. 149. Which professional standard-setting.
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178. Visit the AICPA website at www.aicpa.org and click on Becoming a CPA/Academic Resources. Use the Careers in Accounting tab to locate information on audit careers. 179. Visit the ISACA website at www.isaca.org and click the Students and Educators tab and then the IT Audit Basics tab to find articles.
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41.The Sarbanes-Oxley Act has placed greater restrictions on CPAs by prohibiting certain types of services historically performed by CPAs for their audit clients. 42.The Sarbanes-Oxley Act decreased management’s responsibilities regarding the fair presentation of the financial statements. 43.The responsibility of the auditor to search for fraud is less than the responsibility to.
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135. Although the Sarbanes-Oxley Act of 2002 applies to public companies, many private business organizations have been impacted by this legislation, especially if they are suppliers to a public company.  Explain how this external stakeholder relationship can lead to the widespread application of Section 404 of the Act. 136. Describe at least three.
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87.A large part of the work performed by an auditor in the audit planning process is the gathering of evidence about the company’s internal controls.  This can be completed in any of the following ways, except: A.Interviewing key members of the accounting and IT staff. B.Observing policies and procedures C.Review IT user manuals.
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67.The generally accepted auditing standards are divided into three groups.  Which of the following is not one of those groups? A.General Standards B.Basic Standards C.Standards of Fieldwork D.Standards of Reporting 68.GAAS, generally accepted auditing standards, provide a general framework for conducting quality audits, but the specific standards - or detailed guidance - are provided by.
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- CHAPTER 5 – Problems 138. List the six steps for establishing internal controls and describe how this process leads to stronger overall corporate governance. 139. List the items that must be certified by corporate management in accordance with the provisions of the Sarbanes-Oxley Act.  Discuss how these responsibilities have likely changed the.
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101.The purpose of this phase of systems design is to create the entire set of specifications necessary to build and implement the system. A.Detailed design B.Evaluation and selection C.Operational design D.Detailed analysis 102.In the detailed design stage of systems design it is necessary that the various parts of the system be designed.  The parts of.
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151. List the techniques used for gathering evidence.  152. During which phase of an audit would an auditor consider risk assessment and materiality? 153. What is the significance of Statement on Auditing Standards No. 94?  154. Distinguish between auditing through the computer and auditing with the computer.  155. Explain why it.
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- CHAPTER 7 - MULTIPLE CHOICE 47.Accounting services that improve the quality of information provided to the decision maker, an audit being the most common type of this service, is called: A.Compliance Services B.Assurance Services C.Substantive Services D.Operational Services 48.A type of assurance services that involves accumulating and analyzing support for the information provided by management.
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31.Regardless of the results of the control testing, some level of substantive testing must take place. 32.The use of generalized audit software is especially useful when there are large volumes of data and when there is a need for accurate information. 33.All of the risks and audit procedures that apply to a.
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156. Identify four important aspects of administrative control in an IT environment. 157. Think about a place you have worked where computers were present. What are some physical and environmental controls that you have observed in the workplace? Provide at least two examples of each from your personal experience.  158. Batch.
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- CHAPTER 7 – END OF CHAPTER QUESTIONS: 120.Which of the following types of audits is most likely to be conducted for the purpose of identifying areas for cost savings? A.Financial Statement Audits B.Operational Audits C.Regulatory Audits D.Compliance Audits 121.Financial statement audits are required to be performed by: A.Governmental Auditors B.CPAs C.Internal Auditors D.IT Auditors 122.Which of the following is not.
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- CHAPTER 7 – SHORT ANSWER QUESTIONS 141. What are assurance services? What value do assurance services provide?  142. Differentiate between a compliance audit and an operational audit.  143. Which type of audit is most likely to be performed by government auditors? Which type of audit is most likely to be.
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141.  Using an Internet search engine (such as Google, Dogpile, Lycos), determine who was the whistleblower at Enron.  Summarize the circumstances. What was the relationship of this person with the company?  Was this an internal or external stakeholder? 142. Using an Internet search engine (such as Google, Dogpile, Lycos), search for.
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163. There are several approaches to applying an SDLC methodology to IT system change.  Using an Internet search engine, search for these terms: SDLC, waterfall, JAD (Joint Application Development), RAD (Rapid Application Development), Build and Fix, and Spiral Model.  For example, you might try entering these search terms: SDLC waterfall.  Write.
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