Business Process & Information Technology Flashcards
If an entity wants to implement a system in the business, what procedures should they follow?
design an optimal process and then align the software
What are the advantages of selecting implementing enterprise resource planning (ERP) Software
- Single database
- Timely information
- Unified systems multiple systems and business functions together in one system
- single database unify multiple systems and business functions under one database and facilitate timely reporting
What do decision Support System help do?
Helps provide the users an access to knowledge and models to support judgements and course of action
Accountants use this as tool to make assist them in making decisions such as revenue forecasting during budgeting process
What’s the main objective of Customer Relationship Management (CRM) ?
Customer Relationship Management automate sales, marketing processes, manage customer data, increase revenue and improve customer service
What’s the purpose of enterprise resource planning ERP?
to automate business processes and share common data
What would be the advantage of computer based system for transaction processing over a manual system?
Computer based system uses more codes and relies less on humans to interaction and computer coding for the process
What are the data Governance principals?
Auditability, integrity, transparency, accountability, standardization, stewardship, change in Management, and checks and balance
What is the goal of Data governance?
strategic goals, and objective through the management and control of IT acquisitions, deployment and use
balance risk versus return over IT and its process
What are IT governance objective vs management?
Evaluates IT strategic options and management is make sure those objective are achived and oversees
What type of computerized data processing system, would be most appropriate if a company opens a new retail location?
Real time processing because it allows companies inventory and sales to be updated as soon as the transactions are taken place
What is a unique concern for Software as a Service SAAS?
processed data and the high costs of migrating data
What transaction processing provides the most accurate and complete infor for decison making?
Online provide the most information on a timely manner
When an online order has been processed what advantage would online would have over batch sales order processing system?
Online system the journals entries and ledgers would be immediate and simultaneous. Also, when the order is processed online the they would know immediately when orders are received
When there is an issue on an employees checks, what batch financial would be used?
A payroll batch processing
What is a firewall?
Firewall is tool that prevents unauthorized users from accessing data on a network segment
also separates or isolates a network segment from the main network
If an accountant is using the “Batch processing method” How are the individual transactions are posted on the ledger?
They are posted into groups before they posted and each transaction has it’s own line of entry in the ledger
When a company rep mistakenly applied the customer payment to different customers account how can that be prevent?
If there is a situation where a company rep mistakenly processed the payment to different customers account they would need to complete a “Closed loop verification” that would prevent the issue from occuring in the future by entering the customers info and the info will display the data entry clerk to recognize and correct the mistake prior from occurring
What is the primary function of database management system?
has the abiility to create, modify, summarize information contained in an electronic
What is the primary function of Value Added Network (VAN)
links two different computers together so when that occurs we need to increased security over the data transmissions
When evaluating a cloud service data security a company should consider which risk factors?
- provided third party supliers
- multi tenant architecture
- cloud of cloud agreement
What is one way to detect computer based fraud?
By using a system access log where you can detect check the details of the login activity to detect irregularities attempts
AI Information systems that cannot learn from experience?
rule based expert systems
Purpose of ERP Enterprise Risk Planing
integrate data from various business units a single system with single database
If an employee obtains a blank check and make it payable to a fictitious company what internal control would not be able to prevent this?
Bank reconciliations
when you short the party that is being shorted
receiving shipments is in the long position
Disadvantage to private key to encrypt data?
both the sender and receiver must have the private key before this encryption method
Are internal controls important in EDI system?
Preventive controls are more important than segregation of duties because preventive controls help prevent frauds and errors which is highly critical in a system like EDI
What is EDI Electroic Data Interchange?
data from different companies are connected and that allows to ship products without using humans
Why does EDI needs Translation software?
in order to transform incoming and outgoing transmission from the standard protocol into the one used internally
What are the benefits of using EDI?
EDI make receiving payments easier and quicker also it shortern the business cycle and reduces the AVG receivable balances
reduce the likelhood of stock out of costs
What happens when Auditor are doing audits on EDI?
Lack of physical documents which causes auditors to conduct more testing and internal controls
What are the applications controls?
- Preventative controls - preventing the error or fraud from happening
- Detective Controls - detecting errors and fraud from occurring
- Corrective Controls - allows individuals users to follow up and detected errors and fraud
What are the three type of remote strategies?
Cold site is a recovery where the you need to install the equipment and transfer the data before the recovery process begins. Also the cheapest option and takes the most time since seting up the systems may take weeks to months
Hot Site is recovery site where all the equipment are ready to go for the recovery. Also the costliest to maintain
Warm sites recovery time hours to days and the equipment and software may need additional operations for data loading
What controls are used to ensure input controls used?
Input controls
What type of planning would a business select if they wanted to focus on a effective restore business disater?
Completing planning
What are some examples of preventative controls?
password management, software, encryption and digital certifications
What is the primary purpose of the disaster recovery plan?
Is to specify the steps required to resume operations. these steps would be key to know what to do if there was a recovery and are the necessary steps
What are the elements that represent the most complete disaster recovery plan?
Alternative processing site, backup and off site storage procedures, identification of critical applications, test of the plan
What input control would be able to prevent an incorrect state abbreviation?
Validity checks
What are the six system development life cycle?
analysis
design
development
implementation
testing
maintenance
A large multinational organization job responsibilities should be assigned to the network administrator?
Manage day to day operation remote access
What creates the strongest mechanism for monitoring controls in the new foreign venture?
An internal audit is being performed provides the strongest mechanism
Factors that has the greatest impact on the design of effective management reporting system?
types of decisions that needs to be made.
What attributes make management report greatest impact on management ability to make decisions?
the report needs to be relevant for it to make an impact on the reporting and making decisions
An internal audit manager will request infor in regards the type and amount of training that is being conducted for the IT department. The training records provide documentation for what priniple?
demostrates commitment to reain competent to alignment with objective
What is the benefits of having a computer based system for transaction processing over manual system?
A computer based system would be more efficient than a manual system
Key word to remember is “Efficient”
it would be more accurate cause both data entry are conducted by humans
What type of management reporting system has credit card international developed?
On-Line Analytical processing system
Which individuals reviews and approves long range plans and overseas information systems?
system steering committee
What is the primary goals of information techonology IT Governance?
balance risk over return over IT and it’s process
What are the data governance principals?
integrity, transparency, and auditability
the main purpose of these principals are making sure the data roles and responsibilities and obligations
In Business Information System the term “Stakeholder” is refers to which of the following?
Anyone in the organization that has a role in creating or using documents
What happens to detailed posting types in accounting when batch process system is used?
posting would be assigned into to groups and each transaction would have it’s own line entry in appropriate ledger
Tax shield formulas
Cash expense
Ex - salaries, utililties, and insurance
Formula
Expense x (1 - tax rate)
Noncash expense
Ex - Depreciation, losses, amortization
Formula
Expense x tax rate
if a company wanted to use a computerized data processing a new retail location?
Real time processing because allows updates as soon as transactions are taken in place
What can be discovered using a data mining process?
Previously unknown information
What features does XBRL have?
it’s online business reporting and it tag idenitify the report on the financial statements
In internal control in a electronic data interchange EDI System, What types of controls are most\ important?
Preventive controls are more important than detective controls in EDI systems
What is an advantage of using the internet for electronic commerce rather than a traditional value added network VAN?
since the internet isn’t a batch processing system it doesn’t posses the superior disaster recovery characteristics. Also in order to transact business over the internet the data must be converted to standard format
What is a digital signature used for primarily?
unaltered in transmission
A Value Added network (VAN) is a privately owned network that performs what kind of functions?
route data transaction trading partners
What type of Artifical system cannot learn from experience?
ruled based expected programed to not learn from prior experiences
What transactions provides the most accurate completed information for decision making?
Online
What advantages does Enterprise resource planning (ERP) have over multiple independent functional systems?
it increases the responsiveness, flexibility, and decision making
What step should business continuity plan should intiate first?
conducting a business impact analysis. BIA or business impact analysis assist critical business process where to ensure what would be the financial, legal, reputational and regulatory losses
The following isn’t a major reason for maintaining an audit trail for a computer system?
analytical procedures because this is where the auditor would compare the clients data and since the client data wouldn’t be significant
most effective restore business operations following disaster?
continuity planning because this is where this planning focuses on how can a business effectively restore and continue business operations following a disaster
A general control would be useful for an entity whose systems analyst left in the middle of a major project?
system documentation bc this allows users to understand and know what work has been completed and remains
