Chapter 5

Question 1

4 types of AIS threats

Answer 1

1. Natural and political disasters
2. Software errors
3. Unintentional acts
4. Intentional Acts

Question 2

fires, floods, earthquakes, hurricanes, tornadoes, blizzards, wars, and attacks by terrorists-can destroy an information system and cause many companies to fail

Answer 2

Natural and political disasters

Question 3

operating system crashes, hardware failures, power outages and fluctuations, and undetected data transmission errors constitute a second type of threat.

Answer 3

Software errors

Question 4

accidents or innocent errors an omissions, the greatest risk to information systems and causes the greatest dollar losses.

Answer 4

unintentional acts

Question 5

a computer crime, a fraud, or sabotage, which is deliberate destruction or harm to a system

Answer 5

intentional acts

Question 6

an intentional act where the intent is to destroy a system or some of its components

Answer 6

sabotage

Question 7

a text file by a website and stored on a visitor’s hard drive. Cookies store information about who the user is and what the user has done on the site

Answer 7

cookie

Question 8

any and all means a person uses to gain an unfair advantage over another person

Answer 8

fraud

Question 9

typically businesspeople who commit fraud. white-collar criminals usually resort to trickery or cunning, and their crimes usually involve a violation of trust or confidence

Answer 9

white collar criminals

Question 10

dishonest conduct by those in power which often involves actions that are illegitimate, immoral, or incompatible with ethicals standards. Examples include bribery and bid rigging

Answer 10

corruption

Question 11

misrepresenting or leaving out facts in order to promote an investment that promises fantastic profits with little or no risk. Examples include Ponzi schemes and securities fraud

Answer 11

investment fraud

Question 12

theft of company assets by employees

Answer 12

misappropriation of assets

Question 13

reporting intentional or reckless conduct, whether by act or omission that results in materially misleading financial statements

Answer 13

fraudulent financial reporting

Question 14

a person’s incentive or motivation for committing fraud

Answer 14

pressure

Question 15

the condition or situation that allows a person or organization to commit and conceal a dishonest act and convert it to personal gain

Answer 15

opportunity

Question 16

concealing the theft of cash by means of a series of delays in posting collections to accounts receivable

Answer 16

lapping

Question 17

creating cash using the lag between the time a check is deposited and the time it clears the bank

Answer 17

check kiting

Question 18

the excuse that fraud perpetrators use to justify their illegal behavior

Answer 18

rationalization

Question 19

three elements of the opportunity triangle

Answer 19

commit the fraud, conceal the fraud, convert the theft or misrepresentation to person gain

Question 20

auditors are required to

Answer 20

understand fraud, discuss the risks of material fraudulent misstatements, obtain information, identity asses and respond to risk

Question 21

any type of fraud that requires computer technology to perpetrate

Answer 21

computer fraud

Question 22

the simplest and most common way to commit a computer fraud is to

Answer 22

alter or falsify computer input (input fraud)

Question 23

includes unauthorized system use, including the theft of computer time and services

Answer 23

processor fraud

Question 24

includes tampering with company software, coping software illegally , using software in an unauthorized manner, and developing software to carry out an unauthorized activity

Answer 24

computer instructions fraud

Question 25

illegally using, copying, browsing, searching, or harming company data constitutes

Answer 25

data fraud