Question 1

An auditor sets an embedded audit module to selectively monitor transactions.Selected transactions are then reprocessed independently,and the results are compared with those obtained by the normal system processing.The auditor is using

Accepted Answer

The answer of An auditor sets an embedded audit module...

Question 2

An auditor sets an embedded audit module to flag questionable online transactions,display information about the transaction on the auditor's computer,and send a text message to the auditor's cell phone.The auditor is using

Accepted Answer

The embedded audit module that is set to flag questionable online transactions, display information about the transaction on the auditor's computer and send a text message to the auditor's cell phone is an example of audit hooks. Audit hooks are used to capture specific data or actions within an information system and report them to auditors for review.

Question 3

Explain the differences between each type of audit risk.

Accepted Answer

The answer of Explain the differences between each type of...

Question 4

Which of the following is not one of the types of internal audits?

Accepted Answer

The other options (B, C, and D) are all types of internal audits, whereas reviewing corporate organizational structure and reporting hierarchies is not typically considered an audit function, but rather a review of the organization's structure and processes.

Question 5

An auditor sets an embedded audit module to record all credit transactions in excess of $1,500 and store the data in an audit log.The auditor is using

Accepted Answer

A system control audit review file (SCARF) is used to collect data on transactions that meet certain criteria, such as credit transactions over $1,500, and store them in an audit log for review.

Question 6

An auditor manually calculates accumulated depreciation on a delivery van and compares her calculation with accounting records.This is an example collecting audit evidence by

Accepted Answer

The auditor is manually calculating accumulated depreciation on a delivery van and then comparing it with accounting records. This process involves reperforming a calculation that was already performed by the client's accounting department. The main objective here is to ensure that the depreciation has been accurately recorded in the financial statements. Hence, the best option is reperformance.

Question 7

An auditor sets an embedded audit module to flag all credit transactions in excess of $1,500.The flag causes the system state to be recorded before and after each transaction is processed.The auditor is using

Accepted Answer

The method described in the scenario is the snapshot technique, which involves setting an embedded audit module to capture the system state before and after certain transactions are processed. This allows the auditor to compare the two snapshots and identify any discrepancies or anomalies. The other answer choices, such as the integrated test facility, system control audit review file, and audit hooks, do not match the described method or are not as relevant to the scenario.

Question 8

An increase in the effectiveness of auditing software will have the effect of

Accepted Answer

An increase in the effectiveness of auditing software will lead to a reduction in detection risk as the software will be better able to identify errors or irregularities in the financial statements. This, in turn, will increase the overall efficiency and reliability of the audit process. It will not have any impact on control risk.

Question 9

An increase in the effectiveness of internal controls would have the greatest effect on

Accepted Answer

Internal controls are put in place to reduce the risk of material misstatements in the financial statements. An increase in the effectiveness of internal controls would directly reduce the risk that a material misstatement would go undetected or uncorrected, thus lowering the likelihood of control risk.

Question 10

When programmers are working with program code,they often employ utilities that are also used in auditing.For example,as program code evolves,it is often the case that blocks of code are superseded by other blocks of code.Blocks of code that are not executed by the program can be identified by

Accepted Answer

The answer of When programmers are working with program code,they...

Question 11

An expansion of a firm's operations to include production in Russia and China will have the effect of

Accepted Answer

Expanding operations to countries like Russia and China can increase inherent risk due to factors such as political instability, regulatory differences, and cultural challenges.

Question 12

When programmers are working with program code,they often employ utilities that are also used in auditing.For example,as program code evolves,it is often the case that variables defined during the early part of development become irrelevant.The occurrences of variables that are not used by the program can be found using

Accepted Answer

Scanning routines are specifically designed to analyze program code for various purposes, including identifying unused variables. Program tracing may be used to debug and analyze program flow, but it is not specifically designed for identifying unused variables. Mapping programs and embedded audit modules may have other purposes, but they are not typically used for identifying unused variables.

Question 13

Evaluating effectiveness,efficiency,and goal achievement are objectives of ________ audits.

Accepted Answer

Evaluating effectiveness, efficiency, and goal achievement are objectives of operational audits. While financial and information systems audits may touch on some of these aspects, they are not the primary focus. Operational audits are specifically designed to assess a company's operations and determine if they are functioning effectively and efficiently in line with the company's goals.

Question 14

In the ________ stage of an operational audit,the auditor measures the actual system against an ideal standard.

Accepted Answer

In the evidence evaluation stage of an operational audit, the auditor assesses the collected data against predefined standards or benchmarks to determine the system's effectiveness and efficiency. This involves comparing actual operational outcomes to ideal or expected standards to identify discrepancies, inefficiencies, or areas for improvement.

Question 15

An auditor finds that employee absentee rates are significantly higher on Mondays and Fridays than on other work days.This is an example collecting audit evidence by

Accepted Answer

The auditor has used analytical review to identify a trend in employee absentee rates. Analytical review involves the evaluation of financial information through analysis of plausible relationships among both financial and non-financial data. In this case, the auditor has used data analysis to identify a pattern in employee absences.

Question 16

The scope of a(n)________ audit encompasses all aspects of systems management.

Accepted Answer

The answer of The scope of a(n)________ audit encompasses all...

Question 17

What is the primary purpose of computer audit software?

Accepted Answer

The primary purpose of computer audit software is to assist the auditor in retrieving and reviewing information from a computer system. While it can also help with detecting unauthorized modifications to code and rechecking calculations and financial statements, its main function is to aid in the auditing process.

Question 18

An auditor examines all documents related to the acquisition,repair history,and disposal of a firm's delivery van.This is an example of collecting audit evidence by

Accepted Answer

Vouching is the process of examining documents and records to trace the transactions back to their original source. Here, the auditor is examining documents related to the acquisition, repair history, and disposal of the delivery van to ensure that the transactions were properly authorized, recorded, and reported in the financial statements. Therefore, collecting audit evidence by vouching is the most appropriate choice.

Question 19

Explain why the auditor's role in program development and acquisition should be limited.

Accepted Answer

The answer of Explain why the auditor's role in program...

Question 20

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

Accepted Answer

The auditor is using an integrated test facility, where fictitious transactions are entered into the system and processed alongside real transactions to test the system's functionality and accuracy. This technique allows for a comprehensive testing of the system without disrupting normal operations. The snapshot technique involves taking a snapshot of the system at a particular point in time to assess the system's status and performance. A system control audit review file is a file that captures system activity and events for review and analysis. Continuous and intermittent simulation involves using computer programs to mimic system behavior and test outcomes.

Quiz 11: Auditing Computer-Based Information Systems