Exam 14: Auditing It Controls Part I: Sarbanes-Oxley and It Governance

External auditing is an independent appraisal function established within an organization to examine and evaluate its activities as a service to the organization.

Substantive tests include

List three pairs of system functions that should be separated in the centralized computer services organization.Describe a risk exposure if the functions are not separated.

Operations fraud includes

The same internal control objectives apply to manual and computer-based information systems.

The distributed data processing approach carries some control implications of which accountants should be aware.Discuss two.

IT auditing is a small part of most external and internal audits.

The least important item to store off-site in case of an emergency is

Changing the Hours Worked field in an otherwise legitimate payroll transaction to increase the amount of the paycheck is an example of data collection fraud.

Distinguish between inherent risk and control risk.How do internal controls and detection risk fit in?

Corporate management (including the CEO)must certify monthly and annually their organization's internal controls over financial reporting.

What is scavenging?

For most companies,which of the following is the least critical application for disaster recovery purposes?

Discuss the advantages and disadvantages of the second site backup options.

Statements on Auditing Standards recommendations must be followed by every member of the profession unless it can be shown why a standard does not apply in a given situation.

Adequate backups will protect against all of the following except

Supervision in a computerized environment is more complex than in a manual environment for all of the following reasons except

A strong internal control system will reduce the amount of substantive testing that must be performed.

Why should new systems development activities be segregated from the program change (maintenance)function?

External auditors can cooperate with and use evidence gathered by internal audit departments that are organizationally independent and that report to the audit committee of the board of directors.