Ch9 Practise Q's - Internal Controls II Flashcards
Internal controls are necessary in all businesses because:(LO1)
A business processes do not always go to plan.
B employees are basically corrupt.
C financial statements only contain assertions.
D external auditors insist on them.
A business processes do not always go to plan
Information processing controls are those that are put in place within the organisation to work towards the _______, _______ and _______ of transactions.(LO2)
A efficiency, effectiveness, and accuracy
B timeliness, efficiency, and completeness
C accuracy, completeness, and authorisation
D authorisation, processing, accuracy
C accuracy, completeness, and authorisation
The system documentation tool that is most useful for documenting controls is:(LO9)
A process map.
B structured narrative.
C logical data flow diagram.
D system flowchart.
D system flowchart.
An antivirus program scans and monitors files in a computer continuously for viruses. This is an example of:(LO2)
A preventive control.
B detective control.
C corrective control.
D application control.
B detective control.
A company wants all sales orders over $1000 to be authorised by the sales manager. Are the procedures covering this an example of computer or human controls?(LO8)
A Human.
B Computer.
C Human followed by computer.
D Computer followed by human.
D Computer followed by human.
COBIT5.0 is a framework for the governance and management of enterprise IT (information technology). There are six (6) COBIT 5.0 application controls (AC). AC3 covers accuracy, completeness and authenticity checks. The following are examples of such controls at the data input stage:(LO3)
A limit checks and system access controls.
B edit checks and batch totals.
C range checks and data file maintenance.
D all of the above.
B edit checks and batch totals.
In a small company the sales manager agrees to allow a regular customer to make a purchase that would exceed their credit limit. The customer fails to pay. Of what category of limitation of controls is this an example?(LO10)
A Conflicting signals.
B Management override.
C Collusion.
D Judgement error.
D Judgement error.
COBIT5.0 is a framework for the governance and management of enterprise IT (information technology). There are six (6) COBIT 5.0 application controls (AC). AC4 covers processing integrity and validity. The following are examples of controls to ensure integrity at the data processing stage:(LO3)
A sequence checks and range checks.
B batch totals and limit checks.
C sequence checks and run-to-run totals.
D all of the above.
C sequence checks and run-to-run totals.
Which of the following is NOT a major aim of a computerised accounting information system?(LO4)
A Proper authorisation.
B Timeliness.
C Proper recording.
D User friendly.
D User friendly.
Segregation of duties is a principle that applies to which sections of an organisation?(LO5)
A Throughout the organisation including office staff, accountants and IT workers.
B Accountants.
C Office staff who have to deal with money matters.
D Programmers and computer support staff who could interfere with the accounting information system.
A Throughout the organisation including office staff, accountants and IT workers.
Purchasing goods over the Internet would fit into which of the following categories of processing?(LO4)
A Batch.
B Online real-time.
C Online data collection batched for later processing.
D Shopping basket.
C Online data collection batched for later processing.
Which of the following is NOT a form of physical control?(LO5)
A Servers are placed in a locked room.
B A username and a password are needed to log into a computer.
C Security cameras are put in place.
D A swipe card system for controlling access to computer labs.
B A username and a password are needed to log into a computer.
This would be authorisations.
Which of the following controls will best help detect inventory input accuracy concerns when entering credit sales into a system?
(LO6)
A A batch total of the number of sales invoices in the batch.
B A hash total of the number of inventory items ordered across all invoices.
C A hash total of customer numbers from all sales invoices.
D A sequence check on sales invoice numbers.
B A hash total of the number of inventory items ordered across all invoices.
Which control would best help achieve the aim of correct valuation for purchase transactions entered into a system?(LO6)
A Range checks – checking the quantity ordered against acceptable ranges.
B Validity checks – checking the supplier is listed in our supplier master file.
C Sequence check – ensuring the purchase order number is the next number in the sequence.
D Authorisation – getting a manager to approve all purchases.
A Range checks – checking the quantity ordered against acceptable ranges.
In terms of disaster recovery, organisations’ reaction to the threat of disaster can be:(LO7)
A detective or preventive.
B preventive or corrective.
C detective or corrective.
D preventive, detective and corrective.
B preventive or corrective.
