Accounting Expert Answers & Study Resources : Page 687

61. Bob Chum is the sales manager at Folding Squid Technologies. At lunch with the company CEO, he complained that a recent shipment from a vendor had been unsatisfactory and so had to be returned. That required the purchasing manager to send a ________ to the supplier. A. purchase order B..

41. When an ERP is used, it is assumed that there will be increases in efficiency and the effectiveness of the activities related to the revenue cycle. However, what must be in place and functioning well to fully realize these benefits? A. an effective marketing staff B. all the components.

68. Name and describe the different types of audits. 69. Describe the risk-based audit approach.   .

Accounting Information Systems, 12e (Romney/Steinbart. Chapter 9   Information Systems Controls for Systems Reliability?Part 2: Confidentiality and Privacy 1. Concerning virtual private networks (VPN., which of the following is not true? A. VPNs provide the functionality of a privately owned network using the Internet. B. Using VPN software to encrypt information while it is in.

68. Describe the basic revenue cycle activities. 69. Explain how validity checks, completeness tests and reasonableness tests can be implemented to ensure accuracy of customer orders. 70. Define and describe benefits of a CRM system. 71. How can Electronic Data Interchange (EDI. facilitate the billing and accounts receivable process? 72. Describe typical.

21. Stepanek Sales and Service provides free coffee to employees. Stepanek arranged with Ingebrigtson's Joe to deliver as many coffee packages, sugar, creamer, and filters as needed each week. Ingebrigtson's sends a monthly invoice for Stepanek to pay. This arrangement is best described as a A. blanket purchase order. B. set.

31. Which auditing technique will not assist in determining if unauthorized programming changes have been made? A. Use of a source code comparison program B. Use of the reprocessing technique to compare program output C. Interviewing and making inquiries of the programming staff D. Use of parallel simulation to compare.

41. What is the most effective way to ensure information system availability? A. High bandwidth B. Maintain a hot site C. Maintain a cold site D. Frequent backups 42. Concerning system availability, which of the following statements is true? A. Human error does not threaten system availability. B. Proper controls can maximize the risk of threats causing.

51. ________ involves copying only the data items that have changed since the last partial backup. A. Archive B. Cloud computing C. Differential backup D. Incremental backup 52. ________ copies all changes made since the last full backup. A. Archive B. Cloud computing C. Differential backup D. Incremental backup 53. The maximum amount of time between backups is.

81. Identify ten threats and applicable control procedures in the expenditure cycle.   .

11. Which of the following is an example of a corrective control? A. Physical access controls B. Encryption C. Intrusion detection D. Incident response teams 12. Which of the following is not a requirement of effective passwords? A. Passwords should be changed at regular intervals. B. Passwords should be no more than 8 characters in length. C. Passwords.

11. What is the primary objective of the revenue cycle? A. to maximize revenue and minimize expense B. to reduce outstanding accounts receivable balances through increased cash sales C. to provide the right product in the right place at the right time at the right price D. to sell as.

41. What is the best control to mitigate the threat of paying prices that are too high for goods ordered? A. require the receiving department to verify the existence of a valid purchase order B. use only approved suppliers and solicit competitive bids C. only pay invoices that are supported.

95. What are some of the ways to assign authority and responsibility within an organization? 96. Discuss the weaknesses in COSO's internal control framework that led to the development of the COSO Enterprise Risk Management framework. .

23. Describe some steps you can take to minimize your risk of identify theft. AACSB:  Analytic 24. Describe symmetric encryption and identify three limitations. .

51. A serious exposure in the revenue cycle is loss of assets. What is the related threat and applicable control procedure that address this exposure? A. shipping errors; reconciliation of sales order with picking ticket and packing slip B. theft of cash; segregation of duties and minimization of cash handling.

1. The Squishy Things Toy Company was established in 1948. It recently signed a large contract with a chain of retail toy stores. As a condition of the contract, the Squishy will be required to track and forecast product sales by linking in to the chain's sales database. Squishy will.

1. Auditing involves the A. collection, review, and documentation of audit evidence. B. planning and verification of economic events. C. collection of audit evidence and approval of economic events. D. testing, documentation, and certification of audit evidence. 2. What is not a typical responsibility of an internal auditor? A. helping.

62. Discuss how cloud computing could both positively and negatively affect system availability. 63. Define and contrast a recovery point objective and a recovery time objective. .

1. The best example of a hash total for a payroll transaction file could be A. total of employees' social security numbers. B. sum of net pay. C. total number of employees. D. sum of hours worked. 2. Error logs and review are an example of A. data entry controls. B. data transmission controls. C. output controls. D..

31. When a customer pays off the balance on an invoice, the payment is credited to the ________ file. A. customer master B. sales transaction C. cash receipts master D. All of the above are correct. 32. A type of business document in which part of the original document is returned.

11. The data entry control that would best prevent entering an invoice received from a vendor who is not on an authorized supplier list is A. a validity check. B. an authorization check. C. a check digit. D. closed-loop verification. 12. Forms design is an example of this type of control. A. Data entry control B. Processing.

82. What types of decision-making and strategic information should the AIS provide in the expenditure cycle? 83. How can using RFID tags or bar codes on goods or products provide significant benefit in the expenditure cycle? .

21. A company should check inventory quantities before accepting a sales order for all the following reasons except to A. verify the accuracy of the perpetual inventory records. B. inform the customer about availability and delivery times. C. know which items may need to be back ordered. D. update inventory records.

77. Describe four threats in the revenue cycle and identify appropriate controls for each threat. 78. Discuss the general control issue of the loss of data, as it relates to the revenue cycle. 79. Explain how to effectively segregate duties in the sales order activity.   .

77. Identify possible problems associated with receiving goods and appropriate actions in response to the problems. 78. How can information technology be used to improve the vendor invoice approval process? 79. Under what conditions is MRP more suitable than JIT and vice versa? 80. In the expenditure cycle, the majority of.

48. Identify three ways users can be authenticated and give an example of each. 49. Describe four requirements of effective passwords . 50. Explain social engineering. 51. Explain the value of penetration testing. 52. Describe the function of a computer incident response team (CIRT. and the steps that a CIRT should perform following a.

31. This is an authorized attempt by an internal audit team or an external security consultant to attempt to break into the organization's information system. A. Intrusion detection system B. Log analysis C. Penetration test D. Vulnerability scan 32. A well-known hacker started his own computer security consulting business shortly after being released from prison..

21. Which of the following is the first step in the risk-based audit approach? A. Identify the control procedures that should be in place. B. Evaluate the control procedures. C. Determine the threats facing the AIS. D. Evaluate weaknesses to determine their effect on the audit procedures. 22. Determining whether the necessary control procedures.

73. Describe the two methods to manage accounts receivable. 74. Describe cycle billing and identify how an organization might benefit by using cycle billing. 75. Failure to collect cash on credit sales is a threat in the revenue cycle. What controls can be used to help neutralize this threat? 76. Discuss.

51. An auditor creates a fictitious customer in the system and then creates several fictitious sales to the customer. The records are then tracked as they are processed by the system. The auditor is using A. an integrated test facility. B. the snapshot technique. C. a system control audit review file. D. continuous.

61. A customer service manager at Sad Clown Pajamas, Bob, received a call from the manager at Callow Youth Clothing, who informed Bob that Callow was entering bankruptcy liquidation and it was unlikely that they would be able to pay the outstanding balance on their account. Bob should A. document.

1. The AIS compiles and feeds information among the business cycles. What is the relationship between the revenue and production cycles regarding the exchange of information? A. The revenue cycle provides sales forecast and customer order information to the production cycle, but the production cycle sends information back to revenue.

1. The Trust Services Framework reliability principle that states that users must be able to enter, update, and retrieve data during agreed-upon times is known as A. availability. B. security. C. maintainability. D. integrity. 2. Which of the following is not a useful control procedure to control access to system.

21. Compatibility tests utilize a(n. ________, which is a list of authorized users, programs, and data files the users are authorized to access or manipulate. A. validity test B. biometric matrix C. logical control matrix D. access control matrix 22. The process that screens individual IP packets based solely on.

11. A system that employs various types of advanced technology has more ________ risk than traditional batch processing. A. control B. detection C. inherent D. investing 12. Control risk is defined as the A. susceptibility to material risk in the absence of controls. B. risk that a material misstatement will get.

70. a. What is test data processing? b. How is it done? c. What are the sources that an auditor can use to generate test data? 71. Describe the disadvantages of test data processing. 72. Describe how audit evidence can be collected. .

80. Discuss the revenue cycle threat of stockouts, carrying costs, and markdowns. 81. You have been hired by a catalog company to computerize its sales order entry process. Approximately 70% of all orders are received over the telephone by a sales person. The other 30% of orders are received by.

1. In organizations with at least basic segregation of duties, the credit manager reports to the ________ and the treasurer reports to the ________. A. controller; vice president of finance B. treasurer; controller C. marketing manager; vice president of finance D. treasurer; vice president of finance 2. In the revenue.

41. What is the primary purpose of computer audit software? A. eliminate auditor judgment errors B. assist the auditor in retrieving and reviewing information C. detect unauthorized modifications to system program code D. recheck all mathematical calculations, cross-foot, reprocess financial statements and compare to originals 42. The scope of a(n. ________ audit encompasses.

59. Explain the differences between each type of audit risk. 60. Explain why the auditor's role in program development and acquisition should be limited. 61. How and to whom does an auditor communicate the audit results? 62. Audit tests and procedures traditionally have been performed on a sample basis. Do.

41. Information technology managers are often in a bind when a new exploit is discovered in the wild. They can respond by updating the affected software or hardware with new code provided by the manufacturer, which runs the risk that a flaw in the update will break the system. Or.

31. This control ensures that the correct and most current files are being updated. A. Cross-footing balance test B. Data matching C. File labels D. Write-protect mechanism 32. This batch processing data entry control sums the number of items in a batch. A. Financial total B. Hash total C. Record count D. Sequence check 33. This data entry.

64. Briefly describe tests that can be used to detect unauthorized program modifications. 65. Define and give examples of embedded audit modules. 66. How is a financial audit different from an information systems audit? 67. Why do all audits follow a sequence of events that can be divided into four.

11. Which of the following is not one of the three important factors determining the strength of any encryption system? A. Key length B. Key management policies C. Encryption algorithm D. Privacy 12. A process that takes plaintext of any length and transforms it into a short code. A. Asymmetric encryption B. Encryption C. Hashing D. Symmetric encryption 13. Which.

11. When goods are being ordered from a vendor, which electronic files are either read or updated? A. inventory, vendors, and accounts payable B. vendors and accounts payable C. open purchase orders and accounts payable D. inventory, vendors, and open purchase orders 12. What is a key feature of materials.

21. Check digit verification is an example of a(n. A. data transmission control. B. output control. C. processing control. D. input control. 22. This ensures that the input data will fit into the assigned field. A. Limit check B. Range check C. Size check D. Validity check 23. This tests a numerical amount to ensure that it does not.

51. What control should be put in place that assigns responsibility for EFT payments made to vendors? A. Encrypt all EFT transmissions. B. Time stamp all EFT transactions. C. Establish a control group to monitor EFT transactions for validity and accuracy. D. Number all EFT transactions. 52. Which of the following threats is not.

73. Define and describe the EOQ approach to inventory management. 74. Discuss the differences between EOQ, MRP, and JIT. 75. a. What is the major cost driver in the purchasing function? b. Describe how information technology can be used to control this cost driver. 76. Explain what is meant by.

31. A disbursement voucher contains A. a list of outstanding invoices. B. the net payment amount after deducting applicable discounts and allowances. C. the general ledger accounts to be debited. D. All of the above are correct. 32. One objective of accounts payable is to authorize payment only for goods.