Question 1

Briefly explain the core competency theory.

Accepted Answer

Core competency theory argues that an or...

Question 2

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

Accepted Answer

Combining these functions increases the ...

Question 3

An IT auditor expresses an opinion on the fairness of the financial statements.

Accepted Answer

A) True 
 B)False

Question 4

All of the following tests of controls will provide evidence about the physical security of the computer center except

Accepted Answer

A)   review of fire marshal records
B)   review of the test of the backup power supply
C)   verification of the second site backup location
D)   observation of procedures surrounding visitor access to the computer center

Question 5

Explain why certain duties that are deemed incompatible in a manual system may be combined in an automated environment? Give an example.

Accepted Answer

In an automated environment it would be ...

Question 6

When planning the audit, information is gathered by all of the following methods except

Accepted Answer

A)   completing questionnaires
B)   interviewing management
C)   observing activities
D)   confirming accounts receivable

Question 7

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

Accepted Answer

A) True 
 B)False

Question 8

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

Accepted Answer

A) True 
 B)False

Question 9

A cold site backup approach is also known as

Accepted Answer

A)   internally provided backup
B)   recovery operations center
C)   empty shell
D)   mutual aid pact

Question 10

What are the objectives of application controls?

Accepted Answer

The objectives of application controls are to ensure the validity, completeness, and accuracy financial transactions.

Question 11

The Sarbanes-Oxley Act contains many sections. Which sections are the focus of this chapter?

Accepted Answer

The chapter concentrates on internal control and audit responsibilities pursuant to Sections 302 and 404.

Question 12

Explain how general controls impact transaction integrity and the financial reporting process.

Accepted Answer

Consider an organization with poor datab...

Question 13

Typically, internal auditors perform all of the following tasks except

Accepted Answer

A)   IT audits
B)   evaluation of operational efficiency
C)   review of compliance with legal obligations
D)   internal auditors perform all of the above tasks

Question 14

What control framework is recommended by the PCAOB?

Accepted Answer

The PCAOB's Auditing Standard ...

Question 15

Contrast internal and external auditing.

Accepted Answer

Internal auditing is an independent appr...

Question 16

What are the components of audit risk?

Accepted Answer

Inherent risk is associated with the uni...

Question 17

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

Accepted Answer

A) True 
 B)False

Question 18

Both the SEC and the PCAOB have expressed an opinion as which internal control framework an organization should use to comply with SOX legislation. Explain.

Accepted Answer

Both the SEC and PCAOB endorse the SAS 7/COSO framework but any framework can be used that encompasses all of the SAS 78/COSO's general themes

Question 19

Substantive testing techniques provide information about the accuracy and completeness of an application's processes.

Accepted Answer

A) True 
 B)False

Question 20

__________________________ are intentional mistakes while __________________________ are unintentional mistakes.

Accepted Answer

Irregulari...

Exam 15: IT Controls Part I: Sarbanes-Oxley and It Governance

Briefly explain the core competency theory.

Correct AnswerverifiedCore competency theory argues that an or...View AnswerShow Answer

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

Correct AnswerverifiedCombining these functions increases the ...View AnswerShow Answer

An IT auditor expresses an opinion on the fairness of the financial statements.

Correct AnswerverifiedShow Answer

All of the following tests of controls will provide evidence about the physical security of the computer center except

Correct AnswerverifiedShow Answer

Explain why certain duties that are deemed incompatible in a manual system may be combined in an automated environment? Give an example.

Correct AnswerverifiedIn an automated environment it would be ...View AnswerShow Answer

When planning the audit, information is gathered by all of the following methods except

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

A cold site backup approach is also known as

Correct AnswerverifiedShow Answer

What are the objectives of application controls?

Correct AnswerverifiedThe objectives of application controls are to ensure the validity, completeness, and accuracy financial transactions.

The Sarbanes-Oxley Act contains many sections. Which sections are the focus of this chapter?

Correct AnswerverifiedThe chapter concentrates on internal control and audit responsibilities pursuant to Sections 302 and 404.

Explain how general controls impact transaction integrity and the financial reporting process.

Correct AnswerverifiedConsider an organization with poor datab...View AnswerShow Answer

Typically, internal auditors perform all of the following tasks except

Correct AnswerverifiedShow Answer

What control framework is recommended by the PCAOB?

Correct AnswerverifiedThe PCAOB's Auditing Standard ...View AnswerShow Answer

Contrast internal and external auditing.

Correct AnswerverifiedInternal auditing is an independent appr...View AnswerShow Answer

What are the components of audit risk?

Correct AnswerverifiedInherent risk is associated with the uni...View AnswerShow Answer

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

Correct AnswerverifiedShow Answer

Both the SEC and the PCAOB have expressed an opinion as which internal control framework an organization should use to comply with SOX legislation. Explain.

Correct AnswerverifiedBoth the SEC and PCAOB endorse the SAS 7/COSO framework but any framework can be used that encompasses all of the SAS 78/COSO's general themes

Substantive testing techniques provide information about the accuracy and completeness of an application's processes.

Correct AnswerverifiedShow Answer

__________________________ are intentional mistakes while __________________________ are unintentional mistakes.

Correct AnswerverifiedIrregulari...View AnswerShow Answer

Correct Answer
verified
Core competency theory argues that an or...
View Answer

Correct Answer
verified
Combining these functions increases the ...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
In an automated environment it would be ...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The objectives of application controls are to ensure the validity, completeness, and accuracy financial transactions.

Correct Answer
verified
The chapter concentrates on internal control and audit responsibilities pursuant to Sections 302 and 404.

Correct Answer
verified
Consider an organization with poor datab...
View Answer

Correct Answer
verified

Correct Answer
verified
The PCAOB's Auditing Standard ...
View Answer

Correct Answer
verified
Internal auditing is an independent appr...
View Answer

Correct Answer
verified
Inherent risk is associated with the uni...
View Answer

Correct Answer
verified

Correct Answer
verified
Both the SEC and PCAOB endorse the SAS 7/COSO framework but any framework can be used that encompasses all of the SAS 78/COSO's general themes

Correct Answer
verified

are intentional mistakes while are unintentional mistakes.

Correct Answer
verified
Irregulari...
View Answer