AIS 1
Query, 37
A request for the data base to provide the information needed to deal with a problem or answer a question. The information is retrieved, displayed or printed, and/or analyzed as requested.
What is the question number 68???
A) data input validation checks.
103) The process of defining a database so that it faithfully represents all aspects of the organization including its interactions with the external environment is called
A) data modeling.
Batch Processing, 35
Accumulating transaction records into groups or batches for processing at a regular interval such as daily or weekly. The records are usually sorted into some sequence (such a numerically or alphabetically ) before processing.
82) Duplicate checking of calculations is an example of a ________ control, and procedures to resubmit rejected transactions is an example of a ________ control.
B) detective; corrective
30) Which step below is not considered to be part of the data processing cycle?
B) feedback from external sources
107) In a relational database, entities such as shown in a E-R diagram are contained in
D) tables
1. Which of the following is NOT a step in the data processing cycle? a. data collection b. data input c. data storage d. data processing
Soln: (A) data collection is part of data input & therefore not a step in the data processing cycle.
3. Which of the following would contain the total value of all inventory owned by an organization? a. accounts receivable b. petty cash c. prepaid rent d. retained earnings
Soln: (B) General Ledger - maintains summary information on inventory & every other GL account.
10. Recording and processing information about a transactions at the time it takes place is referred to as which of the following? a. batch processing b. online, real-time processing c. captured transaction processing d. chart of accounts processing
Soln: (B) Online, real-time processing involves processing transactions as they occur.
Source Data Automation, 29
The collection of transaction data in machine-readable form at the time and place or origina. Ex. Point-of-Sale terminals & ATMS.
Online, real-time processing, 35
The computer system processes data immediately after capture and provides updated information to users on a timely basis.
Coding, 30
The systematic assignment of numbwers or letter to items to classify and organize them.
9. Records of company data sent to an external party & then returned to the systems as input are called....
a. turnaround documents b. source data automation documentation c. source documents d. external input documents Soln: (A) Turnaround documents, ex. utility bill is sent to a customer, who then returns the bill with payment.
Document, 35
A record of a transaction or other company data. EX. checks, invoices , receiving reports, & purchase requisitions.
Transaction File, 34
A file that contains the individual business transactions that occur during a specific fiscal period. A transaction file is conceptually similar to a journal in a manual AIS.
Specialized Journals, 32
A journal used to record a large number or repetitive tranactions such as credit sales, cash receivpts purchases, & cash disbursements.
General Journal, 32
A journal used to record infrequent or nonrountine transactions, such as loan payments & end-of-period adjusting & closing entries.
General Ledger, 30
A ledger that contains summary-level data for every asset, liability, equite, revenue, and expense account of the orgnaization.
Subsidiary Ledger, 30
A ledger used to record detailed data for a general ledger account with many individual subaccounts, such as accounts receivable, inventory, and accounts payable.
Chart of Accounts, 31
A listing of all the numbers assigned to balance sheet & income statement accounts. The account numbers allow transaction data to be codes, classified, and entered into the proper accounts, They also facilitate financial statement & report preparation.
Audit Trail, 33
A path that allows a transction to be traced through a data processing system from point of origin to output or backwards from output to point of origin. It is used to check the accuracy & validity of ledger posting & to trace changes in general ledger accounts from their beginning balance to their ending balance.
Master File, 34
A permanent file of records that stores cumulative data about an organization. As transactions take place, individual records within a master file are updated to keep them current.
Record, 34
A set of fields whose data values describe specific attributes of an entity, such as all payroll data relating to a single employee. EX. a row in a spreadsheet.
Database, 34
A set of interrelated, centrally controlled data files that are stored with as little data redundancy as possible. A database consolidated records previously stored in separate files into a common pool and serves a variety of users and data processing applications.
File, 34
A set of logically related records, such as the payroll records of all employees.
Enterprise Resource Planning (ERP) System, 37
A systems that integrates all aspects of an organization's activities, such as accounting, finance, marketing, human resources, manufacturing, inventory management - into one system. An ERP system is modularized; companies can purchase the individual modules that meet their specific needs. An ERP facilitates information flow among the company's various business functions and manages communications with outside stakeholders.
Control Account, 30
A title given to a general ledger account that summarizes the total amounts recorded in a subsidiary ledger. EX. the accounts receivable control account in the general ledger represents the total amount owed by all customers. The balances in the accounts receivable subsidiary ledger indicate the amount owed by each specific customer.
75) Which of the following is not a factor of internal environment according to the COSO Enterprise Risk Management Framework?
A) Analyzing past financial performance and reporting
83) ________ controls prevent, detect and correct transaction errors and fraud.
A) Application
73) Which of the following duties could be performed by the same individual without violating segregation of duties controls?
A) Approving accounting software change requests and testing production scheduling software changes
27) Which of the following is not true about the accounts receivable subsidiary ledger?
A) Debits and credits in the subsidiary ledger must always equal.
28) Changing an employee's hourly wage rate would be recorded in which file?
A) Employee master file
87) This control framework addresses the issue of control from three vantage points: business objectives, information technology resources, and information technology processes.
A) ISACA's control objectives for information and related technology
81) Which of the following is accomplished by corrective controls?
A) Identify the cause of the problem. B) Correct the resulting errors. C) Modify the system to prevent future occurrences of the problem. D) All of the above are accomplished by corrective controls. Answer: D
92) Which component of the COSO Enterprise Risk Management Integrated Framework is concerned with understanding how transactions are initiated, data are captured and processed, and information is reported?
A) Information and communication
95) The risk that exists before management takes any steps to control the likelihood or impact of a risk is A) Inherent risk
A) Inherent risk
76) Which of the following statements about internal environment is false?
A) Management's attitudes toward internal control and ethical behavior have only minimal impact on employee beliefs or actions.
109) A "1-to-many" relationship between Customer Number in the Customer Table and Customer Number in the Sales Order Table means there can be _________.
A) Many sales orders for a given customer, but only one customer per sales order
65) Which of the following is not one of the risk responses identified in the COSO Enterprise Risk Management Framework?
A) Monitoring
102) Which of the following statements about REA modeling and REA diagrams is true?
A) REA is an acronym for Resources, Events, and Agents.
72) Which of the following is a control related to design and use of documents and records?
A) Sequentially prenumbering sales invoices
78) Accountants must try to protect the AIS from threats. Which of the following would be a measure that should be taken?
A) Take a proactive approach to eliminate threats. B) Detect threats that do occur. C) Correct and recover from threats that do occur. D) All of the above are proper measures for the accountant to take. Answer: D
101) The REA data model is so named because it classifies entities into three distinct categories. These categories include all of the following except: A) The Entities that are identified for a business B) The Resources the organization acquires and uses C) The Events that are the business activities in which the organization engages D) The Agents participating in these events Answer: A
A) The Entities that are identified for a business
69) A computer operator is allowed to work as a programmer on a new payroll software project. Does this create a potential internal control problem?
A) Yes, the computer operator could alter the payroll program to increase her salary.
67) Which of the following is an example of a preventive control?
A) approving customer credit prior to approving a sales order
71) According to The Sarbanes-Oxley Act of 2002, the audit committee of the board of directors is directly responsible for
A) hiring and firing the external auditors.
93) The COSO Enterprise Risk Management Integrated Framework identifies four objectives necessary to achieve corporate goals. Objectives specifically identified include all of the following except
A) implementation of newest technologies.
29) A typical source document could be
A) in some paper form. B) a computer data entry screen. D) both A and B Answer: D
70) One of the objectives of the segregation of duties is to
A) make sure that different people handle different parts of the same transaction.
66) A control procedure designed so that the employee that records cash received from customers does not also have access to the cash itself is an example of a(n)
A) preventive control.
99) According to the COSO Enterprise Risk Management Framework, the risk assessment process incorporates all of the following components except
A) reporting potential risks to auditors.
91) The COSO Enterprise Risk Management Integrated Framework stresses that
A) risk management activities are an inherent part of all business operations and should be considered during strategy setting.
26) An ERP system might facilitate the purchase of direct materials by all of the following except
A) selecting the best supplier by comparing bids.
96) When undertaking risk assessment, the expected loss is calculated like this.
B) Impact times likelihood
115) Instead of using the SDLC to develop a new system "in-house," a company may choose to purchase an "Off-the-Shelf" (OTS) system from a software company. This situation means:
B) The OTS will need to be configured (set up) so it can effectively support the business C) Any data in the legacy system that will be loaded into the OTS may need to be converted so that the data can be processed in the new OTS D) Both B and C Answer: D
25) What usually initiates data input into a system?
B) The performance of some business activity generally serves as the trigger for data input.
106) On an entity-relationship (E-R) diagram, anything about which an organization wants to collect and store information is called
B) an entity.
97) The Sarbanes-Oxley Act (SOX) applies to
D) all publicly held companies.
79) The process that a business uses to safeguard assets, provide accurate and reliable information, and promote and improve operational efficiency is known as
B) internal control.
77) One reason why many organizations do not adequately protect their systems is because
B) productivity and cost cutting cause management to forgo implementing and maintaining internal controls.
110) You define a relationship between the Sales Order (Child) table and the Customer (parent) table using a 1-to-many link between
B) the Foreign Key in the Sales Order Table and the Primary Key in the Customer table
84) The primary purpose of the Foreign Corrupt Practices Act of 1977 was
B) to prevent the bribery of foreign officials by American companies.
Block Code, 30
Blcoks of numbers that are reserved for specific categories of data, there by helping to organize the data. EX. A chart of accounts.
108) In a relational database, the relationship between tables (entities) is always
C) 1-to-many
114) An example of a detective control that a new system implementation team may introduce during the physical design phase of a SDLC for implementing a new ERP system for discrete manufacturing is:
C) A report that shown any zero cost parts.
88) This control framework's intent includes helping the organization to provide reasonable assurance that objectives are achieved and problems are minimized, and to avoid adverse publicity and damage to the organization's reputation.
C) COSO's enterprise risk management framework
94) Which attribute below is not an aspect of the COSO ERM Framework internal environment?
C) Restricting access to assets
85) Congress passed this federal law for the purpose of preventing financial statement fraud, to make financial reports more transparent and to strengthen the internal control of public companies.
C) The Sarbanes-Oxley Act of 2002
111) When you define a relationship between the Customer Number in the Sales Order (Child) Table and the Customer Number in the Customer (Parent) Table using a 1-to-many link, setting the Referential Integrity control on the relationship means:
C) You cannot use a Customer Number in entering a new Sales Order that does not already exist in the Customer Table
89) The COSO Enterprise Risk Management Framework includes eight components. Which of the following is not one of them?
C) compliance with federal, state, or local laws
105) A(n) ________ diagram graphically depicts a database's contents by showing entities and relationships.
C) entity-relationship
104) In which stage(s) of the database design process does data modeling occur?
C) in both the systems analysis and design stages
80) Internal control is often referred to as a(n) ________, because it permeates an organization's operating activities and is an integral part of management activities.
C) process
112) What is the correct sequence of the phases in the systems development life cycle?
C) system analysis, conceptual design, physical design, implementation and conversion, and operations and maintenance
Control and Accounting Information Systems
Control and Accounting Information Systems
100) Change management refers to
D) controls designed to ensure that updates in information technology do not have negative consequences.
98) Global Economic Strategies, L.L.D., has been diligent in ensuring that their operations meet modern control standards. Recently, they have extended their control compliance system by incorporating policies and procedures that require the specification of company objectives, uncertainties associated with objectives, and contingency plans. They are transitioning from a ________ to a ________ control framework.
D) COSO-Integrated Framework; COSO-ERM
74) With a limited work force and a desire to maintain strong internal control, which combination of duties would result in the lowest risk exposure?
D) Entering payments to vendors in the cash disbursements journal and entering cash received from customers in the cash receipts journal
90) Which of the following is not one of the eight interrelated risk and control components of COSO Enterprise Risk Management Framework?
D) Event assessment
113) In developing new systems using the SDLC,
D) It is best to analyze, design, test and implement IT controls at the same time that you analyze, design, test and implement non-control functionality.
86) Which of the following is not one of the important aspects of the Sarbanes-Oxley Act?
D) New rules for information systems development
Database Design Using the REA Data Model
Database Design Using the REA Data Model
Source Documents, 28
Documents used to capture transaction data at its source - when the tranaction takes place . Ex. sales orders, purchase orders, and employee time cards.
Use the following information to answer 113 and 114
During the first two phases of the SDLC, systems analysis and conceptual design, control requirements are considered. During the third phase of SDLC, the physical design stage, input, output, and database attributes are designed, as well as specific controls. Programs and procedures are developed during this stage as well. A final part of this stage is the delivery of the developed system, which will be further enhanced during the implementation and conversion stage of the SDLC.
Introduction to Systems Development and Systems Analysis
Introduction to Systems Development and Systems Analysis
Sequence Codes, 30
Items are numbered consecutively so that gaps in the sequence code indicate missing items that should be investigated. EX. prenumbered checks, invoices, and purchase orders.
Mnemonic Code, 30
Letters and numbers that are interspersed to identify an items. The mnemonic code is dervied from the description of the items & is usually easy to memorize.
Turnaround Document, 28
Records of company data sent to an external party & then returned to the systems as input. Turn-around documents are in machine-readable form to facilitate their subsequent processing as input records. EX. Utility bill.
5. Which of the following documents is most likely to be used in the expenditure cycle? a. Sales orders b. credit memo c. receiving report d. job time ticket
Soln: (C) Receiving Report - This is an expenditure cycle document that is used to record the receipt of goods from suppliers. Companies pay their suppliers based on the goods received and recorded on the receiving report.
7. How does the chart of accounts list general ledger accounts? a. alphabetical order b. chronological order c. size order d. the order in which they appear in financial statements
Soln: (D) The order in which they appear in financial statements.
2. All of the information (name, GPA, major, etc) about a particular student is stored in the same.... a. file b. record c. attribute d. field
Soln: (b) record: should include all information maintained by the system about a particular entity , such as a student.
4. Which of the following is most likely to be a general ledger control account? a. accounts receivable b. petty cash c. prepaid rent d. retained earnings
Soln:(A) Accounts Receivable - typically made of many individual customer accounts maintained in a subsidiary ledger. The total of all individual customer accounts in the subsidiary ledger is maintained in the AR control account in the GL.
Report, 36
Systems output, organized in a meaningful fashion, that is used by employees to control operational activities, by managers to make decisions, and design strategies, and by investors and creditors to understand a company's business activities.
Data Processing Cycle, 28
The 4 operations (data input, datea storage, data processing & information output) performed on data to generate meaningful & relevant information.
Data Value, 34
The actual value stored in a field. It describes a particular attribute of an entity. EX. the customer name field would contain "ZYX Company" if that company was a customer.
Entity, 34
The items about which information is stored in a record, EX. an employee, an inventory items, a customer.
Field, 34
The portion of a data record where the data value for a particular attribute is stored. Ex. In a spreadsheet each row might represent a customer and each column is an attribute of the customer. Each cell in a spreadsheet is a field.
Attibutes, 34
The properties identifying numbers, and characteristics of interest of an entity that is stored in a database. EX. employee number, pay rate, name, address.
Group Code, 30
Two or more subgroups of digits that are used to code an item. A group code is often used in conjunction with a block code.