Question 1

Which of the following is not an example of a general control?

Accepted Answer

A)  The organization's use of the systems development life cycle when implementing or modifying computerized processing systems. 
B)  The organization's use of check digits to ensure accurate input of transaction data. 
C)  Periodic and preventative maintenance performed on the computer and related equipment. 
D)  The existence of appropriate separation of duties within the computer department. 
A)  The organization's use of the systems development life cycle when implementing or modifying computerized processing systems. 
B)  The organization's use of check digits to ensure accurate input of transaction data. 
C)  Periodic and preventative maintenance performed on the computer and related equipment. 
D)  The existence of appropriate separation of duties within the computer department.

Question 2

Which of the following error conditions would not be detected through the use of batch totals?

Accepted Answer

A)  A transposition of numbers in a numeric field. 
B)  Entry of an unauthorized transaction supported by documentary evidence. 
C)  Failure to enter a valid transaction through input error. 
D)  Erroneously entering the same transaction twice. 
A)  A transposition of numbers in a numeric field. 
B)  Entry of an unauthorized transaction supported by documentary evidence. 
C)  Failure to enter a valid transaction through input error. 
D)  Erroneously entering the same transaction twice.

Question 3

In simple batch processing systems,it is not possible to use the technique of auditing around the computer.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following computerized processing systems generally can be audited without examining or directly testing the computer programs of the system?

Accepted Answer

A)  A system that performs relatively uncomplicated processes and produces detailed output. 
B)  A system that affects a number of master files and produces a limited output. 
C)  A system that updates a few master files and produces no other printed output than final balances. 
D)  A system that performs relatively complicated processing and produces very little detailed output. 
A)  A system that performs relatively uncomplicated processes and produces detailed output. 
B)  A system that affects a number of master files and produces a limited output. 
C)  A system that updates a few master files and produces no other printed output than final balances. 
D)  A system that performs relatively complicated processing and produces very little detailed output.

Question 5

Which of the following is not an example of a computer control related to file retention and security?

Accepted Answer

A)  Echo check. 
B)  Storage in fireproof vaults. 
C)  Backup versions of files stored in remote locations. 
D)  Grandfather-father-son concept. 
A)  Echo check. 
B)  Storage in fireproof vaults. 
C)  Backup versions of files stored in remote locations. 
D)  Grandfather-father-son concept.

Question 6

The audit team may use internal auditors to develop and run computer-assisted auditing techniques under supervision and review of the audit team.

Accepted Answer

A) True 
 B)False

Question 7

An important hardware control incorporated within computer equipment is a parity check.

Accepted Answer

A) True 
 B)False

Question 8

When audit teams test a computerized processing system,which of the following is true of the test data approach?

Accepted Answer

A)  Several transactions of each type must be tested. 
B)  Test data are processed by the client's computer programs under the audit team's control. 
C)  Test data must consist of all possible valid and invalid combinations. 
D)  The computer program used to process test data is different from the program used throughout the year by the client. 
A)  Several transactions of each type must be tested. 
B)  Test data are processed by the client's computer programs under the audit team's control. 
C)  Test data must consist of all possible valid and invalid combinations. 
D)  The computer program used to process test data is different from the program used throughout the year by the client.

Question 9

Audit teams would most likely introduce test data into a computerized payroll system to test internal controls related to the

Accepted Answer

A)  Existence of unclaimed payroll checks held by supervisors. 
B)  Early cashing of payroll checks by employees. 
C)  Discovery of invalid employee identification numbers. 
D)  Proper approval of overtime by supervisors. 
A)  Existence of unclaimed payroll checks held by supervisors. 
B)  Early cashing of payroll checks by employees. 
C)  Discovery of invalid employee identification numbers. 
D)  Proper approval of overtime by supervisors.

Question 10

Header and trailer labels are examples of external labels.

Accepted Answer

A) True 
 B)False

Question 11

When a real-time computerized processing system is in use,the computer controls can be strengthened by

Accepted Answer

A)  Providing for the separation of duties between data input and error listing operations. 
B)  Using a systems development life cycle for authorization, user involvement, and testing of program modifications. 
C)  Preparing batch totals to provide assurance that file updates are made for the entire group of transactions. 
D)  Performing a validity check of an identification number before a user can obtain access to the computer files. 
A)  Providing for the separation of duties between data input and error listing operations. 
B)  Using a systems development life cycle for authorization, user involvement, and testing of program modifications. 
C)  Preparing batch totals to provide assurance that file updates are made for the entire group of transactions. 
D)  Performing a validity check of an identification number before a user can obtain access to the computer files.

Question 12

Which of the following is not a characteristic of a batch processing system?

Accepted Answer

A)  The collection of similar transactions that are sorted and processed sequentially against a master file. 
B)  The input of transactions prior to processing. 
C)  The production of numerous printouts. 
D)  The posting of a transaction as it occurs to several files without intermediate printouts. 
A)  The collection of similar transactions that are sorted and processed sequentially against a master file. 
B)  The input of transactions prior to processing. 
C)  The production of numerous printouts. 
D)  The posting of a transaction as it occurs to several files without intermediate printouts.

Question 13

Auditing through the computer

Accepted Answer

A)  Is a required approach under generally accepted auditing standards. 
B)  Requires the audit team to evaluate the operating effectiveness of important computer controls. 
C)  Is normally utilized when the client has not implemented significant computer controls. 
D)  Focuses on reconciling the input data to the results generated by the client's computerized processing system. 
A)  Is a required approach under generally accepted auditing standards. 
B)  Requires the audit team to evaluate the operating effectiveness of important computer controls. 
C)  Is normally utilized when the client has not implemented significant computer controls. 
D)  Focuses on reconciling the input data to the results generated by the client's computerized processing system.

Question 14

The method of testing computer controls that requires audit teams to prepare a computer program to process a client's actual data is referred to as a(n)_________________________________.

Accepted Answer

The answer of The method of testing computer controls that...

Question 15

When using parallel simulation,audit teams prepare a computer program to duplicate the logic and computer controls in the client's computer program.

Accepted Answer

A) True 
 B)False

Question 16

When programs or files can be accessed from terminals,users should be required to enter a(n)

Accepted Answer

A)  Parity check. 
B)  Personal identification code. 
C)  Self-diagnosis test. 
D)  Echo check. 
A)  Parity check. 
B)  Personal identification code. 
C)  Self-diagnosis test. 
D)  Echo check.

Question 17

Computer librarians are primarily responsible for operating the computer for each application system.

Accepted Answer

A) True 
 B)False

Question 18

One major difference in a computerized processing environment compared to a manual processing environment is the existence of systematic rather than random errors.

Accepted Answer

A) True 
 B)False

Question 19

Audit teams would least likely use computer-assisted audit techniques to

Accepted Answer

A)  Access client data files. 
B)  Prepare spreadsheets. 
C)  Assess control risk related to computerized processing systems. 
D)  Construct and perform parallel simulations. 
A)  Access client data files. 
B)  Prepare spreadsheets. 
C)  Assess control risk related to computerized processing systems. 
D)  Construct and perform parallel simulations.

Question 20

The major disadvantage of an integrated test facility is that

Accepted Answer

A)  Data processed through the client's system must be "backed out" very carefully. 
B)  The cost of setting up the facility adds to overhead of the system. 
C)  Audit teams need extensive knowledge of computer programming. 
D)  It is a costly use of computer resources. 
A)  Data processed through the client's system must be "backed out" very carefully. 
B)  The cost of setting up the facility adds to overhead of the system. 
C)  Audit teams need extensive knowledge of computer programming. 
D)  It is a costly use of computer resources.

Which of the following is not an example of a general control?

Which of the following error conditions would not be detected through the use of batch totals?

In simple batch processing systems,it is not possible to use the technique of auditing around the computer.

Which of the following computerized processing systems generally can be audited without examining or directly testing the computer programs of the system?

Which of the following is not an example of a computer control related to file retention and security?

The audit team may use internal auditors to develop and run computer-assisted auditing techniques under supervision and review of the audit team.

An important hardware control incorporated within computer equipment is a parity check.

When audit teams test a computerized processing system,which of the following is true of the test data approach?

Audit teams would most likely introduce test data into a computerized payroll system to test internal controls related to the

Header and trailer labels are examples of external labels.

When a real-time computerized processing system is in use,the computer controls can be strengthened by

Which of the following is not a characteristic of a batch processing system?

Auditing through the computer

The method of testing computer controls that requires audit teams to prepare a computer program to process a client's actual data is referred to as a(n)_________________________________.

When using parallel simulation,audit teams prepare a computer program to duplicate the logic and computer controls in the client's computer program.

When programs or files can be accessed from terminals,users should be required to enter a(n)

Computer librarians are primarily responsible for operating the computer for each application system.

One major difference in a computerized processing environment compared to a manual processing environment is the existence of systematic rather than random errors.

Audit teams would least likely use computer-assisted audit techniques to

The major disadvantage of an integrated test facility is that

Auditing and Assurance Services

Professional Standards

Engagement Planning

Management Fraud and Audit Risk

Risk Assessment: Internal Control Evaluation

Employee Fraud and the Audit of Cash

Revenue and Collection Cycle

Acquisition and Expenditure Cycle

Production Cycle

Finance and Investment Cycle

Completing the Audit

Reports on Audited Financial Statements

Other Public Accounting Services

Professional Ethics

Legal Liability

Internal Governmental and Fraud Audits

Overview of Sampling

Attributes Sampling

Variables Sampling

Filters

Exam 20: Auditing in a Computerized Environment

Which of the following is not an example of a general control?

Which of the following error conditions would not be detected through the use of batch totals?

In simple batch processing systems,it is not possible to use the technique of auditing around the computer.

Which of the following computerized processing systems generally can be audited without examining or directly testing the computer programs of the system?

Which of the following is not an example of a computer control related to file retention and security?

The audit team may use internal auditors to develop and run computer-assisted auditing techniques under supervision and review of the audit team.

An important hardware control incorporated within computer equipment is a parity check.

When audit teams test a computerized processing system,which of the following is true of the test data approach?

Audit teams would most likely introduce test data into a computerized payroll system to test internal controls related to the

Header and trailer labels are examples of external labels.

When a real-time computerized processing system is in use,the computer controls can be strengthened by

Which of the following is not a characteristic of a batch processing system?

Auditing through the computer

The method of testing computer controls that requires audit teams to prepare a computer program to process a client's actual data is referred to as a(n)_________________________________.

When using parallel simulation,audit teams prepare a computer program to duplicate the logic and computer controls in the client's computer program.

When programs or files can be accessed from terminals,users should be required to enter a(n)

Computer librarians are primarily responsible for operating the computer for each application system.

One major difference in a computerized processing environment compared to a manual processing environment is the existence of systematic rather than random errors.

Audit teams would least likely use computer-assisted audit techniques to

The major disadvantage of an integrated test facility is that

Auditing and Assurance Services

Professional Standards

Engagement Planning

Management Fraud and Audit Risk

Risk Assessment: Internal Control Evaluation

Employee Fraud and the Audit of Cash

Revenue and Collection Cycle

Acquisition and Expenditure Cycle

Production Cycle

Finance and Investment Cycle

Completing the Audit

Reports on Audited Financial Statements

Other Public Accounting Services

Professional Ethics

Legal Liability

Internal Governmental and Fraud Audits

Overview of Sampling

Attributes Sampling

Variables Sampling

Filters