CHAPTER 1 Flashcards by Hannah Aileen Carpizo

What is the residual effect is that the increased use of technology has resulted in increased budgets, increased successes and failures, and better awareness of the need for control?

IT Environment

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IT Environment is the residual effect is that the increased use of technology has resulted in increased budgets, increased successes and failures, and better awareness of the need for?

CONTROL

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ERP stands for?

Enterprise Resource Planning

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It is a software that provides standard business functionality in an integrated IT environment system

Enterprise Resource Planning

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ERP reduces_________ and ________ and ________ of data from a single source

ERP reduces storage costs and increasing consistency and accuracy of data from a single source

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ISACA stands for?

Information Systems Audit and Control Association

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Cloud Computing > ISACA > PC Magazine > NIST

‘_’

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Who stated that Cloud Computing is the use of the Internet (versus one’s computer’s hard drive) to store and access data and programs?

PC Magazine

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NIST stands for?

National Institute of Standards and Technology

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a “model for enabling ubiquitous, convenient, on-demand network access to a shared pool of configurable computing resources

Cloud Computing

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a “model for enabling ubiquitous, convenient, on-demand network access to a shared pool of configurable computing resources, is stated by?

National Institute of Standards and Technology (NIST)

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MDM Stands for?

Mobile Device Management

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MDM is also known as?

EMM or Enterprise Mobility Management

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responsible for managing and administering mobile devices provided to employees as part of their work responsibilities.

Mobile Device Management (MDM)

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allowing direct access to corporate information always represents an ongoing risk, as well as raises security and compliance concerns for the organization.

Mobile Device Management (MDM)

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IoT stands for?

Internet of Things

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is a system that allows remote assets from “things” (e.g., devices, sensors, objects, etc.) to interact and communicate among them and with other network systems.

Internet of Things

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What is called the huge volumes of raw data or data sets?

Big Data

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Challenges of Big Data

analysis, capture, data curation, search, sharing, storage, transfer, visualization, querying, as well as updating.

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EY Center for Board Matters’ made its publication when?

September 2015

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EY stands for?

Ernst and Young

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Challenges for Auditors?

Limited access to audit data
Scarcity of available and qualified personnel
Timely analytics of audit

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Organizations that issued guidance, instructions, and supported studies and research in audit areas: (5)

ISACA (Information Systems Audit and Control Association)
AICPA (American Institute of Certified Public Accountants)
CICA (Canadian Institute of Chartered Accountants)
IIA (Institute of Internal Auditors)
ACFE (Association of Certified Fraud Examiners)

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AICPA stands for?

American Institute of CPA

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ISACA stands for

Information System Audit and Control Association

IIA

Institute of Internal Auditors

CICA stands for?

Canadian Institute of Chartered Accountants

ACFE Stands for

Association of Certified Fraud Examiners

Auditing Profession timeline:

1952 > 1973 > 2002 > 2008

Auditing Profession (1952)

Computers were commercialized

Auditing Profession (1973)

EFCA (Equity Funding Corporation of America) problems surfaced - Aud profession seriously looked at the lack of computer control on information system

Auditing Profession (2001)

The boom of Enron Case

Auditing Profession (2002)

Presence of WorldCom Fraud

Auditing Profession (2001 and 2002)

-Enron and WorldCom Fraud - Brought sketpicsm and downfall to the financial markets

Auditing Profession (2008)

- Unsound Mortgage strategies and poor risk management (US econ based)

In 1973 under the Auditing Profession, who declared bankruptcy and why?

EFCA or Equity Funding Corporation of America declared bankruptcy due to computer-assisted fraud, leaning to falsification of its records particularly the receivables and marketable securities, losing as much as $200M

What major national professional organization of certified public accountants gave response to EFCA?

AICPA ( American Institute of Certified Public Accountants)

In 1973, _____ appointed a special committee to study whether the auditing standards of the day were adequate in such situations

AICPA

In line with AICPA's response to EFCA, in 1975 the committee issued its?

findings

In line with AICPA's response to EFCA, in 1974 what happened?

AICPA created its first standards covering the area.

The issue of ________________ has come to the forefront of the audit community as a result of major U.S. financial scandals and poor management,

Due Professional Care

What are some of the major U.S Financial Scandals?

Waste Management (1998), Enron (2001), Worldcom (2002), American Insurance Group (2005), Lehman Brothers (2008), Bernard L. Madoff Securities LLC (2008), MF Global (2011), Anthem Inc. (2015), Wells Fargo (2016)

SOX stands for?

Sarbanes-Oxley Act

A famous act of 2002, vividly reminding about the due professional care.

Sarbanes-Oxley Act

FCPA stands for?

Foreign Corrupt Practices Act

package, mandating the most far-reaching changes Congress has imposed on the business world since the FCPA of 1977 and the Securities and Exchange Commission (SEC) Act of 1934.

Sarbanes-Oxley Act of 2002 (SOX)

What are the 2 example of significant changes brought by SOX?

1. PCAOB (Public Company Accounting Oversight Board) 2. increase of criminal penalties for violations of securities laws.

PCAOB stands for?

Public Company Accounting Oversight Board

This legislation mandated that companies whose securities were sold publicly be audited annually by a Certified Public Accountant (CPA)

Financial Auditing

The AICPA issued in 1993 a document called? to further define the importance of internal control in the attestation engagement.

“Reporting on an Entity’s Internal Control Structure over Financial Reporting

The AICPA issued in 1993 a document to further define the importance of ?

internal control in the attestation engagement.

GAAP stands for?

Generally Accepted Accounitng Standards

GAAS stands for?

Generally Accepted Auditing Standards

The present governing body

FASB (Financial Accounting Standards Boards)

What is the three categories of GAAS?

General Standards Standards of Fieldwork Standards of Reporting

Created by the International Accounting Standards Board (IASB) to respond to the increasing global business environment and address the need to compare financial statements prepared in different countries

IFRS (International Financial Reporting Standards)

set of accounting standards developed by the IASB that is becoming the global standard for preparing public company financial statements.

IFRS (International Financial Reporting Standards)

What is the two major accounting standard-setting efforts?

US GAAP and IFRS

independent, objective assurance and consulting activity designed to add value and improve an organization’s operations

Internal Audit Function

assess and enhance their risk management, control, and governance processes, as well as accomplish their goals and objectives.

Internal Audit Function

evaluates the reliability and the validity of systems controls in all forms.

External Audit Function

minimize the amount of substantial auditing or testing of transactions required to render an opinion on the financial statements.

External Audit Function

what is the 4 public accounting firms?

Deloitte Ernst & Young PricewaterhouseCoopers KPMG

what is the 3 composition of IS?

People Process Information Technology

what is the components of IT

Hardware Software Communication

Sub parts of IT

Input Store Process Transmit Output ... data

formal, independent, and objective examination of an organization’s IT infrastructure to determine whether the activities involved in gathering, processing, storing, distributing, and using information comply with guidelines, safeguard assets, maintain data integrity, and operate effectively and efficiently to achieve the organization’s objectives

Information Technology Auditing

TRUE OR FALSE. Provides absolute assurance

FALSE Provides REASONABLE assurance

CHAPTER 1 Flashcards

Quiz 1