Chapter 1: Systems fundamentals

Question 1

Which of the following could be examples of controls in an airline’s online reservation system? (i) A message asking for confirmation of chosen flight dates, (ii) a link to a web page of an affiliated car rental company, (iii) a page seeking confirmation of payment details, (iv) a message informing the buyer that no flights are available at the chosen time, (v) a pop-up screen which appears once the transaction is completed, containing the buyer’s updated frequent flyer points balance.

a) i, ii, iii, iv
b) i, ii, iii, v
c) ii, iii, iv, v
d) i, iii, iv, v

Answer 1

Which of the following could be examples of controls in an airline’s online reservation system? (i) A message asking for confirmation of chosen flight dates, (ii) a link to a web page of an affiliated car rental company, (iii) a page seeking confirmation of payment details, (iv) a message informing the buyer that no flights are available at the chosen time, (v) a pop-up screen which appears once the transaction is completed, containing the buyer’s updated frequent flyer points balance.

a) i, ii, iii, iv
b) i, ii, iii, v
c) ii, iii, iv, v

d) i, iii, iv, v

Question 2

Which of the following activities is not part of the production cycle?

a. Managing raw materials.
b. Planning production.
c. Keeping the finished goods.
d. Handling variances for standard and actual costs of goods manufactured.

Answer 2

Which of the following activities is not part of the production cycle?

a. Managing raw materials.
b. Planning production.

*c. Keeping the finished goods.

d. Handling variances for standard and actual costs of goods manufactured.
* Correct answer: c*
* Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 3

What is information overload?

a. The situation where a computer has more information than is needed or is able to be processed in a meaningful way when a computer program is executed.
b. The situation where an individual has more information than is needed or is able to be processed in a meaningful way when working through a decision.
c. The situation where a computer has more information than is needed or is able to be processed when data storage is taking place.
d. The situation where the amount of information exceeds the storage capacity of the brain of a human being.

Answer 3

What is information overload?

a. The situation where a computer has more information than is needed or is able to be processed in a meaningful way when a computer program is executed.

*b. The situation where an individual has more information than is needed or is able to be processed in a meaningful way when working through a decision.

c. The situation where a computer has more information than is needed or is able to be processed when data storage is taking place.
d. The situation where the amount of information exceeds the storage capacity of the brain of a human being.
* Correct answer: b*
* Learning objective 1.2 – compare and contrast data and information.*

Question 4

What does ERP stand for?

a. Enterprise Resource Planning.
b. Enterprise Resource Package.
c. Electronic Resource Planning.
d. Electronic Resource Package.

Answer 4

What does ERP stand for?

*a. Enterprise Resource Planning.

b. Enterprise Resource Package.
c. Electronic Resource Planning.
d. Electronic Resource Package.
* Correct answer: a*
* Learning objective 1.1 – critically evaluate accounting practices, reflecting on how accounting information systems enrich and extend the role of the accountant.*

Question 5

Internal controls cannot:

a. prevent anomalous and undesirable occurrences.
b. detect anomalous and undesirable occurrences.
c. correct anomalous and undesirable occurrences.
d. reverse the effects brought about by anomalous and undesirable occurrences.

Answer 5

Internal controls cannot:

a. prevent anomalous and undesirable occurrences.
b. detect anomalous and undesirable occurrences.
c. correct anomalous and undesirable occurrences.

*d. reverse the effects brought about by anomalous and undesirable occurrences.

• Correct answer: d*
• Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 6

Which of the following statements regarding internal control is correct?

a. Internal controls provide a degree of assurance that the organisation and its systems are running normally.
b. Internal controls can prevent and detect anomalous and undesirable occurrences, but they cannot reverse the effects caused by such occurrences.
c. Internal controls do not concern about natural disasters and other catastrophic disruptions.
d. Internal controls are only implemented in the most important functions of an organisation.

Answer 6

Which of the following statements regarding internal control is correct?

*a. Internal controls provide a degree of assurance that the organisation and its systems are running normally.

b. Internal controls can prevent and detect anomalous and undesirable occurrences, but they cannot reverse the effects caused by such occurrences.
c. Internal controls do not concern about natural disasters and other catastrophic disruptions.
d. Internal controls are only implemented in the most important functions of an organisation.
* Correct answer: a*
* Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 7

Answer 7

Question 8

An example of an external factor affecting an expenditure system is:

a) how many suppliers the organisation uses.
b) the government’s requirement to record and pay Goods and Services Tax (GST) for some purchases.
c) a request by an employee for a new report to be added to the system.
d) a line employee requesting information about the current year’s expenditure.

Answer 8

An example of an external factor affecting an expenditure system is:

a) how many suppliers the organisation uses.

b) the government’s requirement to record and pay Goods and Services Tax (GST) for some purchases.

c) a request by an employee for a new report to be added to the system.
d) a line employee requesting information about the current year’s expenditure.

Question 9

A large company that provides supplies to the defence forces has just established a new accounting system. Which of the following is an example of a factor in the external environment that would impact on the design of this system:

a. the specification details gained from users.
b. the directive from the finance director about the system’s operation capacity.
c. the defence force requirement regarding e-commerce.
d. the accounting standards governing large companies.

Answer 9

A large company that provides supplies to the defence forces has just established a new accounting system. Which of the following is an example of a factor in the external environment that would impact on the design of this system:

a. the specification details gained from users.
b. the directive from the finance director about the system’s operation capacity.
c. the defence force requirement regarding e-commerce.

*d. the accounting standards governing large companies.

Question 10

Feedback:

a. always includes an error message.
b. is the method to indicate that a problem exists.
c. never includes an error message.
d. is the method for ensuring that the system is running as normal and that there are no problems or exceptional circumstances.

Answer 10

Feedback:

a. always includes an error message.
b. is the method to indicate that a problem exists.
c. never includes an error message.

*d. is the method for ensuring that the system is running as normal and that there are no problems or exceptional circumstances.

Question 11

Which of the following activities is NOT part of the general ledger and financial reporting cycle?

a. Preparing and updating journals and ledger accounts.
b. Preparing end-of-period adjusting entries and close the temporary accounts to profit and loss.
c. Preparing trial balances and producing financial reports.
d. Preparing cheque requisition.

Answer 11

Which of the following activities is NOT part of the general ledger and financial reporting cycle?

a. Preparing and updating journals and ledger accounts.
b. Preparing end-of-period adjusting entries and close the temporary accounts to profit and loss.
c. Preparing trial balances and producing financial reports.

*d. Preparing cheque requisition.

• Correct answer: d*
• Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 12

A system can be defined as:

a. activities that are performed on inputs.
b. any device used to capture data including manual keying and scanning.
c. any process that an accountant is involved in.
d. something that takes inputs, applies a set of rules or processes to the inputs and generates outputs.

Answer 12

A system can be defined as:

a. activities that are performed on inputs.
b. any device used to capture data including manual keying and scanning.
c. any process that an accountant is involved in.

*d. something that takes inputs, applies a set of rules or processes to the inputs and generates outputs.

Question 13

MICR technology offers benefits to organisations that:

a) want to ensure no fraudulent transactions occur.
b) need security in data processing.
c) make lots of payments by cheque.
d) are looking for an efficient means of processing data.

Answer 13

MICR technology offers benefits to organisations that:

a) want to ensure no fraudulent transactions occur.
b) need security in data processing.

c) make lots of payments by cheque.

d) are looking for an efficient means of processing data.

Question 14

Answer 14

Question 15

Which of the following statements regarding the auditing of accounting information systems is NOT true?

a. When conducting an audit, the auditors should consider legislative requirements.
b. When conducting an audit, the auditors should consider professional requirements.
c. When conducting an audit, the auditors should consider prescriptions of various accounting standards.
d. When conducting an audit, the auditors do not need to worry about the unique characteristics of an individual client.

Answer 15

Which of the following statements regarding the auditing of accounting information systems is NOT true?

a. When conducting an audit, the auditors should consider legislative requirements.
b. When conducting an audit, the auditors should consider professional requirements.
c. When conducting an audit, the auditors should consider prescriptions of various accounting standards.

*d. When conducting an audit, the auditors do not need to worry about the unique characteristics of an individual client.

• Correct answer: d*
• Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 16

Answer 16

Question 17

An ER diagram shows:

a. the logical design of the database from a top-down perspective.
b. the physical design of the database from a top-down perspective.
c. the logical design of the database from a bottom-up perspective.
d. the physical design of the database from a bottom-up perspective.

Answer 17

An ER diagram shows:

*a. the logical design of the database from a top-down perspective.

b. the physical design of the database from a top-down perspective.
c. the logical design of the database from a bottom-up perspective.
d. the physical design of the database from a bottom-up perspective.
* Correct answer: a*
* Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 18

Which of the following statements best indicates the difference between data and information:

a. information and data are the same.
b. information is less useful than data.
c. information is always useful whereas data is only sometimes useful.
d. information is data that has been processed and converted

Answer 18

Which of the following statements best indicates the difference between data and information:

a. information and data are the same.
b. information is less useful than data.
c. information is always useful whereas data is only sometimes useful.

*d. information is data that has been processed and converted

• Correct answer: d*
• Learning objective 1.2 – compare and contrast data and information.*

Question 19

Answer 19

Question 20

Answer 20

Question 21

Relational database approach:

a. looks for relationships between different business processes of logically connecting the different pieces of data.
b. looks for relationships between different pieces of data as a means of logically connecting the different pieces of data.
c. looks for relationships between different transactions as a means of logically connecting the different pieces of data.
d. looks for relationships between different business entities as a means of logically connecting the different pieces of data.

Answer 21

Relational database approach:

a. looks for relationships between different business processes of logically connecting the different pieces of data.

*b. looks for relationships between different pieces of data as a means of logically connecting the different pieces of data.

c. looks for relationships between different transactions as a means of logically connecting the different pieces of data.
d. looks for relationships between different business entities as a means of logically connecting the different pieces of data.
* Correct answer: b*
* Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 22

Internal controls do not control:

a. physical assets in an organisation.
b. information resources in an organisation.
c. human behaviours in an organisation.
d. business process efficiencies in an organisation.

Answer 22

Internal controls do not control:

a. physical assets in an organisation.
b. information resources in an organisation.
c. human behaviours in an organisation.

*d. business process efficiencies in an organisation.

• Correct answer: d*
• Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 23

Which are correct?

An accounting information system must (i) capture inputs, (ii) process data, (iii) prepare report outputs, (iv) be computerised, (v) store data, (vi) verify data inputs are correct.

a) i, ii, iii, iv
b) ii, iii, iv, v
c) i, ii, ii, iv, v, vi
d) i, ii, v, vi

Answer 23

Which are correct?

An accounting information system must (i) capture inputs, (ii) process data, (iii) prepare report outputs, (iv) be computerised, (v) store data, (vi) verify data inputs are correct.

a) i, ii, iii, iv
b) ii, iii, iv, v

c) i, ii, ii, iv, v, vi

d) i, ii, v, vi

Question 24

A database represents:

a. the culmination of hardware and software.
b. the culmination of hardware, software and data.
c. the culmination of procedures, hardware, software and data.
d. the culmination of people, procedures, hardware, software and data.

Answer 24

A database represents:

a. the culmination of hardware and software.
b. the culmination of hardware, software and data.
c. the culmination of procedures, hardware, software and data.

*d. the culmination of people, procedures, hardware, software and data.

• Correct answer: d*
• Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 25

Which of the following factors will impact on the way an auditor goes about the audit of an information system?

(i) Legislative requirements.
(ii) Professional requirements.
(iii) Prescription of the various auditing standards.
(iv) Unique characteristics of the individual client.
a. (i) (iii)
b. (i) (ii) (iii)
c. (i) (ii) (iv)
d. (i) (ii) (iii) (iv)

Answer 25

Which of the following factors will impact on the way an auditor goes about the audit of an information system?

(i) Legislative requirements.
(ii) Professional requirements.
(iii) Prescription of the various auditing standards.
(iv) Unique characteristics of the individual client.
a. (i) (iii)
b. (i) (ii) (iii)
c. (i) (ii) (iv)

*d. (i) (ii) (iii) (iv)

• Correct answer: d*
• Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 26

The ability to accurately ___ a system is an important skill for both accountants and auditors:

a. change
b. document
c. store
d. validate

Answer 26

The ability to accurately ___ a system is an important skill for both accountants and auditors:

a. change

*b. document

c. store
d. validate
* Correct answer: b*
* Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 27

The role of the accountant has changed in recent times because:

a. professional bodies have sought to redefine and reposition the accounting function.
b. computer systems have emerged to handle the classification and recording tasks traditionally associated with the accounting function.
c. the accounting cycle is too complex and involved to be performed solely by the accountant.
d. knowledge workers have increasingly replaced accountants in the performance of recording and classification tasks.

Answer 27

The role of the accountant has changed in recent times because:

a. professional bodies have sought to redefine and reposition the accounting function.

*b. computer systems have emerged to handle the classification and recording tasks traditionally associated with the accounting function.

c. the accounting cycle is too complex and involved to be performed solely by the accountant.
d. knowledge workers have increasingly replaced accountants in the performance of recording and classification tasks.

Question 28

Normalisation:

a. is a process that can now be eliminated in designing databases due to technology improvements.
b. ensures all the higher-level operational aspects are also included, as normalisation starts with the tables, forms and data of the organisation.
c. is a top-down process.
d. minimises potential anomalies that can emerge in a data management system.

Answer 28

Normalisation:

a. is a process that can now be eliminated in designing databases due to technology improvements.
b. ensures all the higher-level operational aspects are also included, as normalisation starts with the tables, forms and data of the organisation.
c. is a top-down process.

*d. minimises potential anomalies that can emerge in a data management system.

• Correct answer: d*
• Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 29

Which of the following activities is not part of the expenditure cycle?

a. Purchasing.
b. Updating the accounts payable.
c. Authorising payment.
d. Producing goods.

Answer 29

Which of the following activities is not part of the expenditure cycle?

a. Purchasing.
b. Updating the accounts payable.
c. Authorising payment.

*d. Producing goods.

• Correct answer: d*
• Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 30

The accounting function:

a) has never changed.
b) has typically become more involved with information systems.
c) has become less dependent on data storage and processing technologies, thus decreasing its reliance on information systems.
d) is typically no longer present within the organisation.

Answer 30

The accounting function:

a) has never changed.

b) has typically become more involved with information systems.

c) has become less dependent on data storage and processing technologies, thus decreasing its reliance on information systems.
d) is typically no longer present within the organisation.

Question 31

An accounting information system can best be defined as:

a. the application of technology to the capturing, storing, sorting and reporting of data.
b. the application of technology to the capturing, storing, sorting and reporting of information.
c. the application of technology to the capturing, verifying, storing, sorting and reporting of information relating to an organisation’s activities.
d. the application of technology to the capturing, verifying, storing, sorting and reporting of financial data relating to an organisation’s activities.

Answer 31

An accounting information system can best be defined as:

a. the application of technology to the capturing, storing, sorting and reporting of data.
b. the application of technology to the capturing, storing, sorting and reporting of information.
c. the application of technology to the capturing, verifying, storing, sorting and reporting of information relating to an organisation’s activities.

*d. the application of technology to the capturing, verifying, storing, sorting and reporting of financial data relating to an organisation’s activities.

Question 32

Answer 32

Question 33

Which of the following statements concerning working professionals is correct?

a. A working professional in the accounting domain will not be involved in system development.
b. A working professional in a domain extended beyond accounting is more likely to be involved in system development than their counterparts in the accounting domain.
c. A working professional in a domain extended beyond accounting is less likely to be involved in system development than their counterparts in the accounting domain.
d. System development will be part of the career of a working professional in the accounting domain.

Answer 33

Which of the following statements concerning working professionals is correct?

a. A working professional in the accounting domain will not be involved in system development.
b. A working professional in a domain extended beyond accounting is more likely to be involved in system development than their counterparts in the accounting domain.
c. A working professional in a domain extended beyond accounting is less likely to be involved in system development than their counterparts in the accounting domain.

*d. System development will be part of the career of a working professional in the accounting domain.

• Correct answer: d*
• Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 34

Systems development is unlikely to be driven by:

a. a change in the regulatory environment.
b. a change in the business environment.
c. a business need from within the organisation.
d. a change in the technology infrastructure, such as computer hardware.

Answer 34

Systems development is unlikely to be driven by:

a. a change in the regulatory environment.
b. a change in the business environment.
c. a business need from within the organisation.

*d. a change in the technology infrastructure, such as computer hardware.

• Correct answer: d*
• Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 35

Which of the following statements about the HR management and payroll cycle is NOT true?

a. The cycle involves recruiting employees.
b. The cycle involves managing and paying employees.
c. The cycle involves dealing with situations where employees leave the organisation.
d. Decisions about who to hire will not impact upon the way the other processes are executed.

Answer 35

Which of the following statements about the HR management and payroll cycle is NOT true?

a. The cycle involves recruiting employees.
b. The cycle involves managing and paying employees.
c. The cycle involves dealing with situations where employees leave the organisation.

*d. Decisions about who to hire will not impact upon the way the other processes are executed.

• Correct answer: d*
• Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 36

In general, system documentations cannot show:

a. how business processes are designed.
b. the data that moves through the processes.
c. the activities that occur within the processes.
d. all internal control mechanisms.

Answer 36

In general, system documentations cannot show:

a. how business processes are designed.
b. the data that moves through the processes.
c. the activities that occur within the processes.

*d. all internal control mechanisms.

• Correct answer: d*
• Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 37

Which of the following is unlikely to be the accounting’s role to an organisation?

a. Gather data about the organisation’s activities.
b. Provide a means for business data storage and processing.
c. Convert business data into useful information.
d. Exercise strategic decision-making according to accounting information.

Answer 37

Which of the following is unlikely to be the accounting’s role to an organisation?

a. Gather data about the organisation’s activities.
b. Provide a means for business data storage and processing.
c. Convert business data into useful information.

*d. Exercise strategic decision-making according to accounting information.

Question 38

Information is:

a) a summarised version of data about an organisation’s activities.
b) prepared through the application of processing rules and procedures.
c) meant to be useful for those who receive it.
d) all of the above.

Answer 38

Information is:

a) a summarised version of data about an organisation’s activities.
b) prepared through the application of processing rules and procedures.
c) meant to be useful for those who receive it.

d) all of the above.

Question 39

“Charlie & Dave’s Computer Store” is considering the best way to enter data about new customers that sign up as part of a new marketing campaign. Customers complete their details on a form and leave them at the store for further processing. The best method for capturing this data would be:

a. scanning through barcode technology.
b. optical mark readers.
c. manual keying.
d. scanning through image scanners.

Answer 39

“Charlie & Dave’s Computer Store” is considering the best way to enter data about new customers that sign up as part of a new marketing campaign. Customers complete their details on a form and leave them at the store for further processing. The best method for capturing this data would be:

a. scanning through barcode technology.
b. optical mark readers.

*c. manual keying.

d. scanning through image scanners.

Question 40

The following message box appears when entering a customer order into a sales system:

This is an example of:

a. input.
b. process.
c. output.
d. feedback.

Answer 40

The following message box appears when entering a customer order into a sales system:

This is an example of:

a. input.
b. process.
c. output.

*d. feedback.

• Correct answer: d*
• Learning objective 1.3 – critique and synthesise system concepts, giving examples.*

Question 41

Answer 41

Question 42

Which of the follow statements regarding ethics is false?

a. Ethics is concerned with how we act and how we make decisions.
b. Accountants are bound by professional ethics.
c. Most professional bodies have ethical standards that members must follow.
d. A casual bookkeeping employee, who is not a member of any professional association, need not adhere to professional accounting ethics.

Answer 42

Which of the follow statements regarding ethics is false?

a. Ethics is concerned with how we act and how we make decisions.
b. Accountants are bound by professional ethics.
c. Most professional bodies have ethical standards that members must follow.

*d. A casual bookkeeping employee, who is not a member of any professional association, need not adhere to professional accounting ethics.

• Correct answer: d*
• Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 43

Information is:

a. the same as data.
b. data that has been processed and converted.
c. less useful than data.
d. raw facts describing an event.

Answer 43

Information is:

a. the same as data.

*b. data that has been processed and converted.

c. less useful than data.
d. raw facts describing an event.
* Correct answer: b*
* Learning objective 1.2 – compare and contrast data and information.*

Question 44

The ICAA requires that its members should bring their analytic expertise to several fields. Which one of the following is NOT specified by the ICAA?

a. Strategic planning and change management.
b. Market analysis and compliance.
c. The use of information technology.
d. Human resource management.

Answer 44

The ICAA requires that its members should bring their analytic expertise to several fields. Which one of the following is NOT specified by the ICAA?

a. Strategic planning and change management.
b. Market analysis and compliance.
c. The use of information technology.

*d. Human resource management.

• Correct answer: d*
• Learning objective 1.1 – critically evaluate accounting practices, reflecting on how accounting information systems enrich and extend the role of the accountant.*

Question 45

Answer 45

Question 46

A system:

a) is the combination of inputs, processes, outputs and controls.
b) is only influenced by internal factors.
c) addresses a specific process.
d) can be used to carry out any activity.

Answer 46

A system:

a) is the combination of inputs, processes, outputs and controls.

b) is only influenced by internal factors.
c) addresses a specific process.
d) can be used to carry out any activity.

Question 47

An accounting information system is unlikely to help a firm to:

a. determine whether to approve a credit sale.
b. decide how much to purchase from suppliers.
c. determine the provision for bad debts.
d. eliminate financial fraud.

Answer 47

An accounting information system is unlikely to help a firm to:

a. determine whether to approve a credit sale.
b. decide how much to purchase from suppliers.
c. determine the provision for bad debts.

*d. eliminate financial fraud.

Question 48

Data Mining is:

a. a technology that is used by large multinational resource companies such as BHP, Rio Tinto and Xstrata.
b. declining in popularity with companies due to the emergence of newer technologies.
c. a technology that analyses small pools of internally generated data and identifies possible cost savings.
d. a technology that analyses large pools of data and identifies patterns in them that can then be used by organisations for decision making.

Answer 48

Data Mining is:

a. a technology that is used by large multinational resource companies such as BHP, Rio Tinto and Xstrata.
b. declining in popularity with companies due to the emergence of newer technologies.
c. a technology that analyses small pools of internally generated data and identifies possible cost savings.

*d. a technology that analyses large pools of data and identifies patterns in them that can then be used by organisations for decision making.

• Correct answer: d*
• Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 49

There are a few source documents that contain accounting data. An accounting clerk enters these data into an accounting program hosted in a computer. The computer displays an analysis report on the screen when the accounting program has finished processing the data.

In this scenario, the accounting information system consists of:

a. the accounting program.
b. source document and the accounting program.
c. source document, the accounting program, and the computer.
d. source document, the accounting clerk, the accounting program, and the computer.

Answer 49

There are a few source documents that contain accounting data. An accounting clerk enters these data into an accounting program hosted in a computer. The computer displays an analysis report on the screen when the accounting program has finished processing the data.

In this scenario, the accounting information system consists of:

a. the accounting program.
b. source document and the accounting program.
c. source document, the accounting program, and the computer.

*d. source document, the accounting clerk, the accounting program, and the computer.

Question 50

When it comes to capturing the underlying design and structure of a database, the term “ER diagram” refers to:

a. Enterprise Resource diagram.
b. Entity Relationship diagram.
c. Enterprise Relationship diagram.
d. Entity Resource diagram.

Answer 50

When it comes to capturing the underlying design and structure of a database, the term “ER diagram” refers to:

a. Enterprise Resource diagram.

*b. Entity Relationship diagram.

c. Enterprise Relationship diagram.
d. Entity Resource diagram.
* Correct answer: b*
* Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 51

The role of the accountant has changed in recent times because:

a. professional bodies have sought to redefine and reposition the accounting function.
b. computer systems have emerged to handle the classification and recording tasks traditionally associated with the accounting function.
c. the accounting cycle is too complex and involved to be performed solely by the accountant.
d. knowledge workers have increasingly replaced accountants in the performance of recording and classification tasks.

Answer 51

The role of the accountant has changed in recent times because:

a. professional bodies have sought to redefine and reposition the accounting function.

*b. computer systems have emerged to handle the classification and recording tasks traditionally associated with the accounting function.

c. the accounting cycle is too complex and involved to be performed solely by the accountant.
d. knowledge workers have increasingly replaced accountants in the performance of recording and classification tasks.
* Correct answer: b*
* Learning objective 1.1 – critically evaluate accounting practices, reflecting on how accounting information systems enrich and extend the role of the accountant.*

Question 52

Answer 52

Question 53

Answer 53

Question 54

As computer systems have been developed to perform the recording and classification tasks associated with business activities, the nature of accounting and the work of the accountant has also been pushed in a new direction. Increasingly, the role of the accountant is seen to be to:

a. use computer programs rather than manual journals.
b. ensure that businesses invest in new software.
c. add value and provide and interpret information for an organisation.
d. outsource accounting work to bookkeepers.

Answer 54

As computer systems have been developed to perform the recording and classification tasks associated with business activities, the nature of accounting and the work of the accountant has also been pushed in a new direction. Increasingly, the role of the accountant is seen to be to:

a. use computer programs rather than manual journals.
b. ensure that businesses invest in new software.

*c. add value and provide and interpret information for an organisation.

d. outsource accounting work to bookkeepers.

Question 55

Which of the following statements concerning ethics is correct?

a. Ethics is concerned with how we act and how we make decisions.
b. Electronic accounting information systems eliminate the need for ethical behaviour.
c. Professional bodies, such as CPA and ICAA, are placing less reliance on ethics and more on legal compliance.
d. Ethical issues and legal issues are the same.

Answer 55

Which of the following statements concerning ethics is correct?

*a. Ethics is concerned with how we act and how we make decisions.

b. Electronic accounting information systems eliminate the need for ethical behaviour.
c. Professional bodies, such as CPA and ICAA, are placing less reliance on ethics and more on legal compliance.
d. Ethical issues and legal issues are the same.
* Correct answer: a*
* Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 56

Over time, the relationship between accounting and information systems has seen:

a. accounting gain an increased role as the emphasis shifted from information systems to accounting.
b. information systems gain an increased role as the emphasis shifted from accounting to information systems.
c. information systems and accounting share the emphasis.
d. both accounting and information systems become part of a wider organisational IT function.

Answer 56

Over time, the relationship between accounting and information systems has seen:

a. accounting gain an increased role as the emphasis shifted from information systems to accounting.

*b. information systems gain an increased role as the emphasis shifted from accounting to information systems.

c. information systems and accounting share the emphasis.
d. both accounting and information systems become part of a wider organisational IT function.

Question 57

Inputs can include:

a. receipts and invoices that are given to customers.
b. data as well as other resources, that are the starting point for the system.
c. any process that an accountant is involved in.
d. computer reports that are analysed by accountants.

Answer 57

Inputs can include:

a. receipts and invoices that are given to customers.

*b. data as well as other resources, that are the starting point for the system.

c. any process that an accountant is involved in.
d. computer reports that are analysed by accountants.

Question 58

The domain that a system addresses is called:

a. system scope.
b. database.
c. external environment.
d. IPO model.

Answer 58

The domain that a system addresses is called:

*a. system scope.

b. database.
c. external environment.
d. IPO model.
* Correct answer: a*
* Learning objective 1.3 – critique and synthesise system concepts, giving examples.*

Question 59

Which process drives value throughout an organisation by enabling the alignment of information to best address business needs?

a. Data categorisation.
b. Data management.

c . Data classification.

d. Data validation.

Answer 59

Which process drives value throughout an organisation by enabling the alignment of information to best address business needs?

a. Data categorisation.
b. Data management.

*c . Data classification.

d. Data validation.
* Correct answer: c*
* Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 60

MICR is an input technology used:

a. on receipts and invoices that are given to customers.
b. on bank cheques.
c. in the processing of ATM receipts.
d. by many organisations to expedite the processing of accounts payable invoices.

Answer 60

MICR is an input technology used:

a. on receipts and invoices that are given to customers.

*b. on bank cheques.

c. in the processing of ATM receipts.
d. by many organisations to expedite the processing of accounts payable invoices.

Question 61

Which one of the following is often overlooked by businesses when it comes to internal control?

a. Fraud.
b. Theft of business data.
c. Disaster recovery.
d. Errors in data.

Answer 61

Which one of the following is often overlooked by businesses when it comes to internal control?

a. Fraud.
b. Theft of business data.

*c. Disaster recovery.

d. Errors in data.
* Correct answer: c*
* Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 62

Which of the following description of XBRL is true?

a. XBRL is a new technology that is yet to be made a practical reality.
b. XBRL adds meaning to data so that other applications know what the data represents and how it should be treated.
c. XBRL is fundamentally different from HTML.
d. A standard set of XBRL tags is not available yet.

Answer 62

Which of the following description of XBRL is true?

a. XBRL is a new technology that is yet to be made a practical reality.

*b. XBRL adds meaning to data so that other applications know what the data represents and how it should be treated.

c. XBRL is fundamentally different from HTML.
d. A standard set of XBRL tags is not available yet.
* Correct answer: b*
* Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 63

Which of the following statements regarding system documentation is correct?

a. Systems documentation is only useful for internal staff.
b. Systems documentation is increasingly being phased out of organisations due to newer technology.
c. Systems documentation is crucial for systems development and systems review.
d. Answers a and c are both correct.

Answer 63

Which of the following statements regarding system documentation is correct?

a. Systems documentation is only useful for internal staff.
b. Systems documentation is increasingly being phased out of organisations due to newer technology.

*c. Systems documentation is crucial for systems development and systems review.

d. Answers a and c are both correct.
* Correct answer: c*
* Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 64

Which of the following statements regarding business processes is correct?

a. Business processes represent the series of discrete activities that deliver something of value to external customers.
b. Business processes represent the series of discrete activities that deliver something of value to both internal and external customers.
c. Business processes represent the series of interlocking activities that deliver something of value to internal customers.
d. Business processes represent the series of interlocking activities that deliver something of value to both internal and external customers.

Answer 64

Which of the following statements regarding business processes is correct?

a. Business processes represent the series of discrete activities that deliver something of value to external customers.
b. Business processes represent the series of discrete activities that deliver something of value to both internal and external customers.
c. Business processes represent the series of interlocking activities that deliver something of value to internal customers.

*d. Business processes represent the series of interlocking activities that deliver something of value to both internal and external customers.

• Correct answer: d*
• Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 65

Which of the following statements is NOT a major reason of why accountants of the twenty-first century must be comfortable with information systems concepts?

a. Computer systems are playing an increasing part in the management and functioning of the organisation.
b. Accountants are increasingly exposed to and working with technology and information systems.
c. Accountants need to know how computers manage knowledge and its data resources.
d. Accountants need to lead and oversee the design of an accounting information system.

Answer 65

Which of the following statements is NOT a major reason of why accountants of the twenty-first century must be comfortable with information systems concepts?

a. Computer systems are playing an increasing part in the management and functioning of the organisation.
b. Accountants are increasingly exposed to and working with technology and information systems.
c. Accountants need to know how computers manage knowledge and its data resources.

*d. Accountants need to lead and oversee the design of an accounting information system.

• Correct answer: d*
• Learning objective 1.1 – critically evaluate accounting practices, reflecting on how accounting information systems enrich and extend the role of the accountant.*

Question 66

An example of an output from an accounting information system could be:

a. the screen for entering transactions.
b. the screen for selecting what report to produce.
c. the screen that lists updated and categorised account balances.
d. the screen for entering file saving locations.

Answer 66

An example of an output from an accounting information system could be:

a. the screen for entering transactions.
b. the screen for selecting what report to produce.

*c. the screen that lists updated and categorised account balances.

d. the screen for entering file saving locations.

Question 67

Which of the following activities is not part of the revenue cycle?

a. Receiving customer orders.
b. Checking credit history.
c. Packing and shipping goods to customers.
d. Ordering new goods from suppliers.

Answer 67

Which of the following activities is not part of the revenue cycle?

a. Receiving customer orders.
b. Checking credit history.
c. Packing and shipping goods to customers.

*d. Ordering new goods from suppliers.

• Correct answer: d*
• Learning objective 1.5 – justify and communicate the role of accounting information in supporting decision makers.*

Question 68

Data is:

a) useful for decision-making.
b) best captured using technology.
c) best used by an organisation when linked to the processes that generate or require them.
d) managed by data-mining technology.

Answer 68

Data is:

a) useful for decision-making.
b) best captured using technology.

c) best used by an organisation when linked to the processes that generate or require them.

d) managed by data-mining technology.