Information Accounting Systems, 7eTest Bank, Chapter 15 Chapter 15IT Controls Part I: Sarbanes-Oxley and IT Governance TRUE/FALSE 1.

Corporate management (including the CEO) must certify monthly and annually their organizations internal controls over financial reporting. ANS: F PTS: 1 2. Both the SEC and the PCAOB require management to use the COBIT framework for assessing internal control adequacy. ANS: F PTS: 1 3. Both the SEC and the PCAOB require management to use the COSO framework for assessing internal control adequacy. ANS: F PTS: 1 4. A qualified opinion on managements assessment of internal controls over the financial reporting system necessitates a qualified opinion on the financial statements? ANS: F PTS: 1 5. The same internal control objectives apply to manual and computer-based information systems. ANS: T PTS: 1 6. To fulfill the segregation of duties control objective, computer processing functions (like authorization of credit and billing) are separated. ANS: F PTS: 1 7. To ensure sound internal control, program coding and program processing should be separated. ANS: T PTS: 1 8. Some systems professionals have unrestricted access to the organization's programs and data. ANS: T PTS: 1 9. Application controls apply to a wide range of exposures that threaten the integrity of all programs processed within the computer environment. ANS: F PTS: 1 10. The database administrator should be separated from systems development. ANS: T PTS: 1 11. A disaster recovery plan is a comprehensive statement of all actions to be taken after a disaster. ANS: T PTS: 1 12. IT auditing is a small part of most external and internal audits. ANS: F PTS: 1 13. Assurance services is an emerging field that goes beyond the auditors traditional attestation function. ANS: T PTS: 1 14. An IT auditor expresses an opinion on the fairness of the financial statements. ANS: F PTS: 1 15. External auditing is an independent appraisal function established within an organization to examine and evaluate its activities as a service to the organization. ANS: F PTS: 1 16. 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. ANS: T PTS: 1 17. Tests of controls determine whether the database contents fairly reflect the organization's transactions. ANS: F PTS: 1 18. Audit risk is the probability that the auditor will render an unqualified opinion on financial statements that are materially misstated. ANS: T PTS: 1 19. A strong internal control system will reduce the amount of substantive testing that must be performed. ANS: T PTS: 1 20. Substantive testing techniques provide information about the accuracy and completeness of an application's processes. ANS: F PTS: 1 21. The most common access point for perpetrating computer fraud is at the data collection stage. ANS: T PTS: 1 22. 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. ANS: T PTS: 1 23. Scavenging is a form of fraud in which the perpetrator uses a computer program to search for key terms in a database and then steal the data. ANS: F PTS: 1 24. Transaction cost economics (TCE) theory suggests that firms should outsource specific non core IT assets ANS: F PTS: 1

25. Commodity IT assets easily acquired in the marketplace and should be outsourced under the core competency theory. ANS: F PTS: 1 MULTIPLE CHOICE 1. Which of the following is NOT an implication of section 302 of the Sarbanes-Oxley Act? a. Auditors must determine, whether changes in internal control has, or is likely to, materially affect internal control over financial reporting. b. Auditors must interview management regarding significant changes in the design or operation of internal control that occurred since the last audit. c. Corporate management (including the CEO) must certify monthly and annually their organizations internal controls over financial reporting. d. Management must disclose any material changes in the companys internal controls that have occurred during the most recent fiscal quarter. ANS: C PTS: 1 2. Which of the following is NOT a requirement in managements report on the effectiveness of internal controls over financial reporting? a. A statement of managements responsibility for establishing and maintaining adequate internal control user satisfaction. b. A statement that the organizations internal auditors has issued an attestation report on managements assessment of the companies internal controls. c. A statement identifying the framework used by management to conduct their assessment of internal controls. d. An explicit written conclusion as to the effectiveness of internal control over financial reporting. ANS: B PTS: 1 3. In a computer-based information system, which of the following duties needs to be separated? a. program coding from program operations b. program operations from program maintenance c. program maintenance from program coding d. all of the above duties should be separated ANS: D PTS: 1 4.Supervision in a computerized environment is more complex than in a manual environment for all of the following reasons except a. rapid turnover of systems professionals complicates management's task of assessing the competence and honesty of prospective employees b. many systems professionals have direct and unrestricted access to the organization's programs and data c. rapid changes in technology make staffing the systems environment challenging d. systems professionals and their supervisors work at the same physical location ANS: D PTS: 1 5.Adequate backups will protect against all of the following except a. natural disasters such as fires b. unauthorized access c. data corruption caused by program errors d. system crashes ANS: B PTS: 1 6. Which is the most critical segregation of duties in the centralized computer services function? a. systems development from data processing b. data operations from data librarian c. data preparation from data control d. data control from data librarian ANS: A PTS: 1

7. Systems development is separated from data processing activities because failure to do so a. weakens database access security b. allows programmers access to make unauthorized changes to applications during execution c. results in inadequate documentation d. results in master files being inadvertently erased ANS: B PTS: 1 8. Which organizational structure is most likely to result in good documentation procedures? a. separate systems development from systems maintenance b. separate systems analysis from application programming c. separate systems development from data processing d. separate database administrator from data processing ANS: A PTS: 1 9. All of the following are control risks associated with the distributed data processing structure except a. lack of separation of duties b. system incompatibilities c. system interdependency d. lack of documentation standards ANS: C PTS: 1 10. Which of the following is not an essential feature of a disaster recovery plan? a. off-site storage of backups b. computer services function c. second site backup d. critical applications identified ANS: B PTS: 1 11. A cold site backup approach is also known as a. internally provided backup b. recovery operations center c. empty shell d. mutual aid pact ANS: C PTS: 1 12. The major disadvantage of an empty shell solution as a second site backup is a. the host site may be unwilling to disrupt its processing needs to process the critical applications of the disaster stricken company b. intense competition for shell resources during a widespread disaster c. maintenance of excess hardware capacity d. the control of the shell site is an administrative drain on the company ANS: B PTS: 1 13. An advantage of a recovery operations center is that a. this is an inexpensive solution b. the initial recovery period is very quick c. the company has sole control over the administration of the center d. none of the above are advantages of the recovery operations center ANS: B PTS: 1 14. For most companies, which of the following is the least critical application for disaster recovery purposes? a. month-end adjustments b. accounts receivable c. accounts payable d. order entry/billing

ANS: A PTS: 1 15.The least important item to store off-site in case of an emergency is a. backups of systems software b. backups of application software c. documentation and blank forms d. results of the latest test of the disaster recovery program ANS: D PTS: 1 16. Some companies separate systems analysis from programming/program maintenance. All of the following are control weaknesses that may occur with this organizational structure except a. systems documentation is inadequate because of pressures to begin coding a new program before documenting the current program b. illegal lines of code are hidden among legitimate code and a fraud is covered up for a long period of time c. a new systems analyst has difficulty in understanding the logic of the program d. inadequate systems documentation is prepared because this provides a sense of job security to the programmer ANS: C PTS: 1 17. All of the following are recommended features of a fire protection system for a computer center except a. clearly marked exits b. an elaborate water sprinkler system c. manual fire extinguishers in strategic locations d. automatic and manual alarms in strategic locations ANS: B PTS: 1 18. Which concept is not an integral part of an audit? a. evaluating internal controls b. preparing financial statements c. expressing an opinion d. analyzing financial data ANS: B PTS: 1 19. Which statement is not true? a. Auditors must maintain independence. b. IT auditors attest to the integrity of the computer system. c. IT auditing is independent of the general financial audit. d. IT auditing can be performed by both external and internal auditors. ANS: C PTS: 1 20. Typically, internal auditors perform all of the following tasks except a. IT audits b. evaluation of operational efficiency c. review of compliance with legal obligations d. internal auditors perform all of the above tasks ANS: D PTS: 1 21. The fundamental difference between internal and external auditing is that a. internal auditors represent the interests of the organization and external auditors represent outsiders b. internal auditors perform IT audits and external auditors perform financial statement audits c. internal auditors focus on financial statement audits and external auditors focus on operational audits and financial statement audits d. external auditors assist internal auditors but internal auditors cannot assist external auditors ANS: A PTS: 1

22. Internal auditors assist external auditors with financial audits to a. reduce audit fees b. ensure independence c. represent the interests of management d. the statement is not true; internal auditors are not permitted to assist external auditors with financial audits ANS: A PTS: 1 23. Which statement is not correct? a. Auditors gather evidence using tests of controls and substantive tests. b. The most important element in determining the level of materiality is the mathematical formula. c. Auditors express an opinion in their audit report. d. Auditors compare evidence to established criteria. ANS: B PTS: 1 24. All of the following are steps in an IT audit except a. substantive testing b. tests of controls c. post-audit testing d. audit planning ANS: C PTS: 1 25. When planning the audit, information is gathered by all of the following methods except a. completing questionnaires b. interviewing management c. observing activities d. confirming accounts receivable ANS: D PTS: 1 26. Substantive tests include a. examining the safety deposit box for stock certificates b. reviewing systems documentation c. completing questionnaires d. observation ANS: A PTS: 1 27. Tests of controls include a. confirming accounts receivable b. counting inventory c. completing questionnaires d. counting cash ANS: C PTS: 1 28. All of the following are components of audit risk except a. control risk b. legal risk c. detection risk d. inherent risk ANS: B PTS: 1 29. Control risk is a. the probability that the auditor will render an unqualified opinion on financial statements that are materially misstated b. associated with the unique characteristics of the business or industry of the client c. the likelihood that the control structure is flawed because controls are either absent or inadequate to prevent or detect errors in the accounts d. the risk that auditors are willing to take that errors not detected or prevented by the control

structure will also not be detected by the auditor ANS: C PTS: 1 30. All of the following tests of controls will provide evidence about the physical security of the computer center except 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 ANS: C PTS: 1 31. All of the following tests of controls will provide evidence about the adequacy of the disaster recovery plan except a. inspection of the second site backup b. analysis of the fire detection system at the primary site c. review of the critical applications list d. composition of the disaster recovery team ANS: B PTS: 1 32. Which of the following is true? a. In the CBIS environment, auditors gather evidence relating only to the contents of databases, not the reliability of the computer system. b. Conducting an audit is a systematic and logical process that applies to all forms of information systems. c. Substantive tests establish whether internal controls are functioning properly. d. IT auditors prepare the audit report if the system is computerized. ANS: B PTS: 1 33. Inherent risk a. exists because all control structures are flawed in some ways. b. is the likelihood that material misstatements exist in the financial statements of the firm. c. is associated with the unique characteristics of the business or industry of the client. d. is the likelihood that the auditor will not find material misstatements. ANS: C PTS: 1 34. Attestation services require all of the following except a. written assertions and a practitioners written report b. the engagement is designed to conduct risk assessment of the clients systems to verify their degree of SOX compliance c. the formal establishment of measurements criteria d. the engagement is limited to examination, review, and application of agreed-upon procedures ANS: B PTS: 1 35. The financial statements of an organization reflect a set of management assertions about the financial health of the business. All of the following describe types of assertions except a. that all of the assets and equities on the balance sheet exist b. that all employees are properly trained to carry out their assigned duties c. that all transactions on the income statement actually occurred d. that all allocated amounts such as depreciation are calculated on a systematic and rational basis ANS: B 36. PTS: 1 All of the following are issues of computer security except a. releasing incorrect data to authorized individuals b. permitting computer operators unlimited access to the computer room c. permitting access to data by unauthorized individuals d. providing correct data to unauthorized individuals ANS: B PTS: 1 37 . Operations fraud includes

a. altering program logic to cause the application to process data incorrectly b. misusing the firms computer resources c. destroying or corrupting a programs logic using a computer virus d. creating illegal programs that can access data files to alter, delete, or insert values ANS: B PTS: 1 38.Segregation of duties in the computer-based information system includes a. separating the programmer from the computer operator b. preventing management override c. separating the inventory process from the billing process d. performing independent verifications by the computer operator ANS: A PTS: 1 39.Computer fraud can take on many forms, including each of the following except a. theft or illegal use of computer-readable information b. theft, misuse, or misappropriation of computer equipment c. theft, misuse, or misappropriation of assets by altering computer-readable records and files d. theft, misuse, or misappropriation of printer supplies ANS: D 40. The following are examples of commodity assets except a. network management b. systems operations c. systems development d. server maintenance ANS: C 41. The following are examples of specific assets except a. b. c. d. application maintenance data warehousing highly skilled employees server maintenance ANS: D 42. Which of the following is true? a. Core competency theory argues that an organization should outsource specific core assets. b. Core competency theory argues that an organization should focus exclusively on its core business competencies c. Core competency theory argues that an organization should not outsource specific commodity assets. d. Core competency theory argues that an organization should retain certain specific non core assets in-house. ANS: B 43. Which of the following is not true? a. Large-scale IT outsourcing involves transferring specific assets to a vendor b. Specific assets, while valuable to the client, are of little value to the vendor c. Once an organization outsources its specific assets, it may not be able to return to its pre-outsource state. d. Specific assets are of value to vendors because, once acquired, vendors can achieve economies of scale by employing them with other clients ANS: D 44. Which of the following is not true? a. When management outsources their organizations IT functions, they also outsource responsibility for internal control. b. Once a client firm has outsourced specific IT assets, its performance becomes linked to the vendors performance. c. IT outsourcing may affect incongruence between a firms IT strategic planning and its business planning functions. d. The financial justification for IT outsourcing depends upon the vendor achieving economies of scale.

ANS: A 45. Which of the following is not true? a. Management may outsource their organizations IT functions, but they cannot outsource their management responsibilities for internal control. b. section 404 requires the explicit testing of outsourced controls. c. The SAS 70 report, which is prepared by the outsourcers auditor, attests to the adequacy of the vendors internal controls. d. Auditors issue two types of SAS 70 reports: SAS 70 Type I report and SAS 70 Type II report. ANS: C

Chap5/6?? CIS Information Accounting Systems, 7eTest Bank, Chapter 17 Chapter 17IT Controls Part III: Systems Development, Program Changes, and Application Controls TRUE/FALSE 1. Programs in their compiled state are very susceptible to the threat of unauthorized modification. ANS: F 2. Maintenance access to systems increases the risk that logic will be corrupted either by the accident or intent to defraud. ANS: T 3. Source program library controls should prevent and detect unauthorized access to application programs. ANS: T 4. A check digit is a method of detecting data coding errors. ANS: T 5. Input controls are intended to detect errors in transaction data after processing. ANS: F 6. The black box approach to testing computer applications allows the auditor to explicitly review program logic. ANS: F 7. The user test and acceptance procedure is the last point at which the user can determine the systems acceptability prior to it going into service. ANS: T 8. A run-to-run control is an example of an output control. ANS: F 9. Shredding computer printouts is an example of an output control. ANS: T 10. In a computerized environment, all input controls are implemented after data is input. ANS: F 11. Achieving batch control objectives requires grouping similar types of input transactions (such as sales orders) together in batches and then controlling the batches throughout data processing. ANS: T 12. The white box tests of program controls are also known as auditing through the computer. ANS: T 13. The presence of a SPLMS effectively guarantees program integrity. ANS: F 14. When using the test data method, the presence of multiple error messages indicates a flaw in the preparation of test transactions. ANS: F 15. The base case system evaluation is a variation of the test data method. ANS: T 16. Tracing is a method used to verify the logical operations executed by a computer application. ANS: T 17. Generalized audit software packages are used to assist the auditor in performing substantive tests. ANS: T 18. The results of a parallel simulation are compared to the results of a production run in order to judge the quality of the application processes and controls. ANS: T

19. Firms with an independent internal audit staff may conduct tests of the system development life cycle on an ongoing basis. ANS: T 20. The programmers authority table will specify the libraries a programmer may access. ANS: T 21. Use of the integrated test facility poses no threat to organizational data files. ANS: F 22. Spooling is a form of processing control. ANS: F 23. A salami fraud affects a large number of victims, but the harm to each appears to be very small. ANS: T 24. An input control that tests time card records to verify than no employee has worked more 50 hours in a pay period is an example of a range test. ANS: F 25. The black box approach to testing computer program controls is also known as auditing around the computer. ANS: T MULTIPLE CHOICE 1. Which statement is not correct? The audit trail in a computerized environment a. consists of records that are stored sequentially in an audit file b. traces transactions from their source to their final disposition c. is a function of the quality and integrity of the application programs d. may take the form of pointers, indexes, and embedded keys ANS: A 2. Which control is not associated with new systems development activities? a. reconciling program version numbers b. program testing c. user involvement d. internal audit participation ANS: A 3. Routine maintenance activities require all of the following controls except a. documentation updates b. testing c. formal authorization d. internal audit approval 2011 ANS: D 4. Which statement is correct? a. compiled programs are very susceptible to unauthorized modification b. the source program library stores application programs in source code form c. modifications are made to programs in machine code language d. the source program library management system increases operating efficiency ANS: B 5. Which control is not a part of the source program library management system? a. using passwords to limit access to application programs b. assigning a test name to all programs undergoing maintenance c. combining access to the development and maintenance test libraries d. assigning version numbers to programs to record program modifications ANS: C 6. Which control ensures that production files cannot be accessed without specific permission? a. Database Management System b. Recovery Operations Function c. Source Program Library Management System d. Computer Services Function ANS: C 7. Program testing

a. involves individual modules only, not the full system b. requires creation of meaningful test data c. need not be repeated once the system is implemented d. is primarily concerned with usability ANS: B 8. The correct purchase order number,is123456. All of the following are transcription errors except a. 1234567 b. 12345 c. 124356 d. 123454 ANS: C 9. Which of the following is correct? a. check digits should be used for all data codes b. check digits are always placed at the end of a data code c. check digits do not affect processing efficiency d. check digits are designed to detect transcription and transposition errors ANS: D 10. Which statement is not correct? The goal of batch controls is to ensure that during processing a. transactions are not omitted b. transactions are not added c. transactions are free from clerical errors d. an audit trail is created ANS: C 11. An example of a hash total is a. total payroll checks$12,315 b. total number of employees10 c. sum of the social security numbers12,555,437,251 d. none of the above ANS: C 12. Which statement is not true? A batch control record a. contains a transaction code b. records the record count c. contains a hash total d. control figures in the record may be adjusted during processing e. All the above are true ANS: E 13. Which of the following is not an example of a processing control? a. hash total. b. record count. c. batch total. d. check digit ANS: D 14. Which of the following is an example of input control test? a. sequence check b. zero value check c. spooling check d. range check ANS: D 15. Which input control check would detect a payment made to a nonexistent vendor? a. missing data check b. numeric/alphabetic check c. range check d. validity check

ANS: D 16. Which input control check would detect a posting to the wrong customer account? a. missing data check b. check digit c. reasonableness check d. validity check ANS: B 17. The employee entered "40" in the "hours worked per day" field. Which check would detect this unintentional error? a. numeric/alphabetic data check b. sign check c. limit check d. missing data check ANS: C 18. An inventory record indicates that 12 items of a specific product are on hand. A customer purchased two of the items, but when recording the order, the data entry clerk mistakenly entered 20 items sold. Which check could detect this error? a. numeric/alphabetic data checks b. limit check c. range check d. reasonableness check ANS: B 19. Which check is not an input control? a. reasonableness check b. validity check. c. spooling check d. missing data check ANS: C 20. A computer operator was in a hurry and accidentally used the wrong master file to process a transaction file. As a result, the accounts receivable master file was erased. Which control would prevent this from happening? a. header label check b. expiration date check c. version check d. validity check ANS: A 21. Run-to-run control totals can be used for all of the following except a. to ensure that all data input is validated b. to ensure that only transactions of a similar type are being processed c. to ensure the records are in sequence and are not missing d. to ensure that no transaction is omitted ANS: A 22. Methods used to maintain an audit trail in a computerized environment include all of the following except a. transaction logs b. Transaction Listings. c. data encryption d. log of automatic transactions ANS: C 23. Risk exposures associated with creating an output file as an intermediate step in the printing process (spooling) include all of the following actions by a computer criminal except a. gaining access to the output file and changing critical data values b. using a remote printer and incurring operating inefficiencies c. making a copy of the output file and using the copy to produce illegal output reports d. printing an extra hardcopy of the output file ANS: B

24. Which statement is not correct? a. only successful transactions are recorded on a transaction log b. unsuccessful transactions are recorded in an error file c. a transaction log is a temporary file d. a hardcopy transaction listing is provided to users ANS: C 25. Input controls include all of the following except a. check digits b. Limit check. c. spooling check d. missing data check ANS: C 26. Which of the following is an example of an input error correction technique? a. immediate correction b. rejection of batch c. creation of error file d. all are examples of input error correction techniques ANS: D 27. Which test of controls will provide evidence that the system as originally implemented was free from material errors and free from fraud? Review of the documentation indicates that a. a cost-benefit analysis was conducted b. the detailed design was an appropriate solution to the user's problem c. tests were conducted at the individual module and total system levels prior to implementation d. problems detected during the conversion period were corrected in the maintenance phase ANS: C 28. Which statement is not true? a. An audit objective for systems maintenance is to detect unauthorized access to application databases. b. An audit objective for systems maintenance is to ensure that applications are free from errors. c. An audit objective for systems maintenance is to verify that user requests for maintenance reconcile to program version numbers. d. An audit objective for systems maintenance is to ensure that the production libraries are protected from unauthorized access. ANS: A 29. When the auditor reconciles the program version numbers, which audit objective is being tested? a. protect applications from unauthorized changes b. ensure applications are free from error c. protect production libraries from unauthorized access d. ensure incompatible functions have been identified and segregated ANS: A 30. When auditors do not rely on a detailed knowledge of the application's internal logic, they are performing a. black box tests of program controls b. white box tests of program controls c. substantive testing d. intuitive testing ANS: A 31. All of the following concepts are associated with the black box approach to auditing computer applications except a. the application need not be removed from service and tested directly b. auditors do not rely on a detailed knowledge of the application's internal logic c. the auditor reconciles previously produced output results with production input transactions d. this approach is used for complex transactions that receive input from many sources ANS: D 32. Which test is not an example of a white box test? a. determining the fair value of inventory b. ensuring that passwords are valid

c. verifying that all pay rates are within a specified range d. reconciling control totals ANS: A 33. When analyzing the results of the test data method, the auditor would spend the least amount of time reviewing a. the test transactions b. error reports c. updated master files d. output reports ANS: A 34. All of the following are advantages of the test data technique except a. auditors need minimal computer expertise to use this method b. this method causes minimal disruption to the firm's operations c. the test data is easily compiled d. the auditor obtains explicit evidence concerning application functions ANS: C 35. All of the following are disadvantages of the test data technique except a. the test data technique requires extensive computer expertise on the part of the auditor b. the auditor cannot be sure that the application being tested is a copy of the current application used by computer services personnel c. the auditor cannot be sure that the application being tested is the same application used throughout the entire year d. preparation of the test data is time-consuming ANS: A 36. All of the following statements are true about the integrated test facility (ITF) except a. production reports are affected by ITF transactions b. ITF databases contain "dummy" records integrated with legitimate records c. ITF permits ongoing application auditing d. ITF does not disrupt operations or require the intervention of computer services personnel ANS: A 37. Which statement is not true? Embedded audit modules a. can be turned on and off by the auditor. b. reduce operating efficiency. c. may lose their viability in an environment where programs are modified frequently. d. identify transactions to be analyzed using white box tests. ANS: D 38. Generalized audit software packages perform all of the following tasks except a. recalculate data fields b. compare files and identify differences c. stratify statistical samples d. analyze results and form opinions ANS: D 39. Which of the following is not an input control? a. Range check b. Limit check c. Spooling check d. Validity check e. They are all input controls ANS: C 40. Which of the following is an input control? a. Reasonableness check b. Run-to-run check c. Spooling check d. Batch check e. None are input controls ANS: A

Chap 3/4?? CIS Information Accounting Systems, 7eTest Bank, Chapter 16 Chapter 16IT Controls Part II: Security and Access TRUE/FALSE 1. In a computerized environment, the audit trail log must be printed onto paper documents. ANS: F 2. Disguising message packets to look as if they came from another user and to gain access to the hosts network is called spooling. ANS: F 3. A formal log-on procedure is the operating systems last line of defense against unauthorized access. ANS: F 4. Computer viruses usually spread throughout the system before being detected. ANS: T 5. A worm is software program that replicates itself in areas of idle memory until the system fails. ANS: T 6. Viruses rarely attach themselves to executable files. ANS: F 7. Subschemas are used to authorize user access privileges to specific data elements. ANS: F 8. A recovery module suspends all data processing while the system reconciles its journal files against the database. ANS: F 9. The database management system controls access to program files. ANS: F 10. Operating system controls are of interest to system professionals but should not concern accountants and auditors. ANS: F 11. The most frequent victims of program viruses are microcomputers. ANS: T 12. Access controls protect databases against destruction, loss or misuse through unauthorized access. ANS: T 13. Operating system integrity is not of concern to accountants because only hardware risks are involved. ANS: F 14. Audit trails in computerized systems are comprised of two types of audit logs: detailed logs of individual keystrokes and event-oriented logs. ANS: T 15. In a telecommunications environment, line errors can be detected by using an echo check. ANS: T 16. Firewalls are special materials used to insulate computer facilities ANS: F 17. The message authentication code is calculated by the sender and the receiver of a data transmission. ANS: T 18. The request-response technique should detect if a data communication transmission has been diverted. ANS: T 19. Electronic data interchange translation software interfaces with the sending firm and the value added network. ANS: F 20. A value added network can detect and reject transactions by unauthorized trading partners. ANS: T 21. Electronic data interchange customers may be given access to the vendor's data files. ANS: T 22. The audit trail for electronic data interchange transactions is stored on magnetic media. ANS: T 23. A firewall is a hardware partition designed to protect networks from power surges. ANS: F

24. To preserve audit trails in a computerized environment, transaction logs are permanent records of transactions. ANS: T 25. Examining programmer authority tables for information about who has access to Data Definition Language commands will provide evidence about who is responsible for creating subschemas. ANS: T MULTIPLE CHOICE 1. The operating system performs all of the following tasks except a. translates third-generation languages into machine language b. assigns memory to applications c. authorizes user access d. schedules job processing ANS: C 2. Which of the following is considered an unintentional threat to the integrity of the operating system? a. a hacker gaining access to the system because of a security flaw b. a hardware flaw that causes the system to crash c. a virus that formats the hard drive d. the systems programmer accessing individual user files ANS: B 3. A software program that replicates itself in areas of idle memory until the system fails is called a a. Trojan horse b. worm c. logic bomb d. none of the above ANS: B 4. A software program that allows access to a system without going through the normal logon procedures is called a a. logic bomb b. Trojan horse c. worm d. back door ANS: D 5. All of the following will reduce the exposure to computer viruses except a. install antivirus software b. install factory-sealed application software c. assign and control user passwords d. install public-domain software from reputable bulletin boards ANS: D 6. Which backup technique is most appropriate for sequential batch systems? a. grandparent-parent-child approach b. staggered backup approach c. direct backup d. remote site, intermittent backup ANS: A 7. When creating and controlling backups for a sequential batch system, a. the number of backup versions retained depends on the amount of data in the file b. off-site backups are not required c. backup files can never be used for scratch files d. the more significant the data, the greater the number of backup versions ANS: D

8. Hackers can disguise their message packets to look as if they came from an authorized user and gain access to the hosts network using a technique called a. spoofing. b. spooling. c. dual-homed. d. screening. ANS: A 9. In a direct access file system a. backups are created using the grandfather-father-son approach b. processing a transaction file against a maser file creates a backup file c. files are backed up immediately before an update run d. if the master file is destroyed, it cannot be reconstructed ANS: C 10. Which of the following is not an access control in a database system? a. antivirus software b. database authorization table c. passwords d. voice prints ANS: A 11. Which is not a biometric device? a. password b. retina prints c. voice prints d. signature characteristics ANS: A 12. Which of the following is not a basic database backup and recovery feature? a. checkpoint b. backup database c. transaction log d. database authority table ANS: D 13. All of the following are objectives of operating system control except a. protecting the OS from users b. protesting users from each other c. protecting users from themselves d. protecting the environment from users ANS: D 14. Passwords are secret codes that users enter to gain access to systems. Security can be compromised by all of the following except a. failure to change passwords on a regular basis b. using obscure passwords unknown to others c. recording passwords in obvious places d. selecting passwords that can be easily detected by computer criminals ANS: B 15. Audit trails cannot be used to a. detect unauthorized access to systems b. facilitate reconstruction of events

c. reduce the need for other forms of security d. promote personal accountability ANS: C 16. Which control will not reduce the likelihood of data loss due to a line error? a. echo check b. encryption c. vertical parity bit d. horizontal parity bit ANS: B 17. Which method will render useless data captured by unauthorized receivers? a. echo check b. parity bit c. public key encryption d. message sequencing ANS: C 18. Which method is most likely to detect unauthorized access to the system? a. message transaction log b. data encryption standard c. vertical parity check d. request-response technique ANS: A 19. All of the following techniques are used to validate electronic data interchange transactions except a. value added networks can compare passwords to a valid customer file before message transmission b. prior to converting the message, the translation software of the receiving company can compare the password against a validation file in the firm's database c. the recipient's application software can validate the password prior to processing d. the recipient's application software can validate the password after the transaction has been processed ANS: D 20. In an electronic data interchange environment, customers routinely access a. the vendor's price list file b. the vendor's accounts payable file c. the vendor's open purchase order file d. none of the above ANS: A 21. All of the following tests of controls will provide evidence that adequate computer virus control techniques are in place and functioning except a. verifying that only authorized software is used on company computers b. reviewing system maintenance records c. confirming that antivirus software is in use d. examining the password policy including a review of the authority table ANS: B 22. Audit objectives for the database management system include all of the following except a. verifying that the security group monitors and reports on fault tolerance violations b. confirming that backup procedures are adequate c. ensuring that authorized users access only those files they need to perform their duties d. verifying that unauthorized users cannot access data files ANS: A

23. All of the following tests of controls will provide evidence that access to the data files is limited except a. inspecting biometric controls b. reconciling program version numbers c. comparing job descriptions with access privileges stored in the authority table d. attempting to retrieve unauthorized data via inference queries ANS: B 24. Audit objectives for communications controls include all of the following except a. detection and correction of message loss due to equipment failure b. prevention and detection of illegal access to communication channels c. procedures that render intercepted messages useless d. all of the above ANS: D 25. When auditors examine and test the call-back feature, they are testing which audit objective? a. incompatible functions have been segregated b. application programs are protected from unauthorized access c. physical security measures are adequate to protect the organization from natural disaster d. illegal access to the system is prevented and detected ANS: D 26. In an electronic data interchange (EDI) environment, when the auditor compares the terms of the trading partner agreement against the access privileges stated in the database authority table, the auditor is testing which audit objective? a. all EDI transactions are authorized b. unauthorized trading partners cannot gain access to database records c. authorized trading partners have access only to approved data d. a complete audit trail is maintained ANS: C 27. Audit objectives in the electronic data interchange (EDI) environment include all of the following except a. all EDI transactions are authorized b. unauthorized trading partners cannot gain access to database records c. a complete audit trail of EDI transactions is maintained d. backup procedures are in place and functioning properly ANS: D 28. In determining whether a system is adequately protected from attacks by computer viruses, all of the following policies are relevant except a. the policy on the purchase of software only from reputable vendors b. the policy that all software upgrades are checked for viruses before they are implemented c. the policy that current versions of antivirus software should be available to all users d. the policy that permits users to take files home to work on them ANS: D 29. Which of the following is not a test of access controls? a. biometric controls b. encryption controls c. backup controls d. inference controls ANS: C 30. In an electronic data interchange environment, customers routinely a. access the vendor's accounts receivable file with read/write authority b. access the vendor's price list file with read/write authority c. access the vendor's inventory file with read-only authority

d. access the vendor's open purchase order file with read-only authority ANS: C 31. In an electronic data interchange environment, the audit trail a. is a printout of all incoming and outgoing transactions b. is an electronic log of all transactions received, translated, and processed by the system c. is a computer resource authority table d. consists of pointers and indexes within the database ANS: B 32. All of the following are designed to control exposures from subversive threats except a. firewalls b. one-time passwords c. field interrogation d. data encryption ANS: C 33. Many techniques exist to reduce the likelihood and effects of data communication hardware failure. One of these is a. hardware access procedures b. antivirus software c. parity checks d. data encryption ANS: C 34. Which of the following deal with transaction legitimacy? a. transaction authorization and validation b. access controls c. EDI audit trail d. all of the above ANS: D 35. Firewalls are a. special materials used to insulate computer facilities b. a system that enforces access control between two networks c. special software used to screen Internet access d. none of the above ANS: B 36. The database attributes that individual users have permission to access are defined in a. operating system. b. user manual. c. database schema. d. user view. e. application listing. ANS: D 37. An integrated group of programs that supports the applications and facilitates their access to specified resources is called a (an) a. operating system. b. database management system. c. utility system d. facility system. e. object system. ANS: A

38. Transmitting numerous SYN packets to a targeted receiver, but NOT responding to an ACK, is a. a smurf attack. b. IP Spoofing. c. an ACK echo attack d. a ping attack. e. none of the above ANS: E 39. Which of the following is true? a. Deep Packet Inspection uses a variety of analytical and statistical techniques to evaluate the contents of message packets. b. An Intrusion prevention system works in parallel with a firewall at the perimeter of the network to act as a filer that removes malicious packets from the flow before they can affect servers and networks. c. A distributed denial of service attack is so named because it is capable of attacking many victims simultaneously who are distributed across the internet. d. None of the above are true statements. ANS: A 40. Advance encryption standard (AES) is a. a 64 -bit private key encryption technique b. a 128-bit private key encryption technique c. a 128-bit public key encryption technique d. a 256-bit public encryption technique that has become a U.S. government standard ANS: B