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exam 2 Flashcards

1
Q

A scheme where the perpetrator steals the cash or check that customer A mails in to pay its accounts receivable, then the perpetrator takes the funds from customer B to later cover that account. And so on with customer C.

A

Lapping

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2
Q

Which of the following creates an environment where computer fraud is less likely to occur?

A

Increase the penalties for committing fraud.

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3
Q

Kitting is a scheme in which:

A

Insufficient funds are covered up by deposits made at one bank by checks drawn at another bank.

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4
Q

Which of the following is not part of the fraud triangle?

A

All are part of the fraud triangle.

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5
Q

In order for an act to be legally considered fraud it must be all of the following except

A

No intent to deceive

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6
Q

According to Statement on Auditing Standards No. 99 (SAS 99) an auditor should do all of the following except:

A

Acquire malpractice insurance in case the auditor does not detect actual fraud during the audit.

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7
Q

According to the opportunity part of the fraud triangle, a person may do all of the following acts except:

A

Control the fraud.

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8
Q

Which of the following pressures are classified as Management Characteristics that can lead to financial statement fraud?

A

High management and/or employee turnover

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9
Q

All of the following are classifications of computer fraud except:

A

Reconciliation fraud.

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10
Q

Which of the following actions are used to reduce fraud loss after fraud occurs?

A

Maintain adequate insurance.

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11
Q

Which of the following is considered a financial pressure (as opposed to emotional or lifestyle pressures) that can lead to employee fraud?

A

Poor credit ratings

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12
Q

There are many threats to accounting information systems. Which of the following is an example of an Intentional Act?

A

Computer Fraud

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13
Q

A computer crime that involves attacking phone lines is:

A

phreaking.

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14
Q

Hackers use all of the following techniques except:

A

war driving.

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15
Q

Social engineering is most likely to facilitate what type of computer fraud?

A

identity theft

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16
Q

The computer crime of piggybacking

A

can involve the clandestine use of another user’s WIFI

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17
Q

A network of computers used in a denial-of-service (DoS) attack is called a(n):

A

botnet

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18
Q

Time bombs are most likely planted in an information system by:

A

disgruntled computer programmers

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19
Q

Spyware infections came from:

A

all of the above

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20
Q

Which of the following is not a characteristic of computer viruses?

A

They are easy to detect and destroy.

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21
Q

Which of the following is known as a zero-day attack?

A

an attack between the time a new software vulnerability is discovered and the time a patch for fixing the problem is released

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22
Q

Which of the following is a method used to embezzle money a small amount at a time from many different accounts?

A

Salami technique

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23
Q

Which of the following is not a method that is used for identity theft?

A

spamming

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24
Q

A computer fraud and abuse technique that steals information, trade secrets, and intellectual property.

A

economic espionage

25
Q

The Sarbanes Oxley Act is the most important business-oriented legislation in the past 80 years. Which of the following are elements of the Sarbanes Oxley Act?

A

All of the above

26
Q

After the Sarbanes Oxley Act (SOX) was passed, the Securities and Exchange Commission (SEC) required management to do which of the following:

A

report material internal control weaknesses

27
Q

Which of the following system(s) compares actual performance with planned performance?

A

diagnostic control system

28
Q

Which of the following is (are) a component(s) of COSO’s internal control model?

A

all of the above

29
Q

What is (are) a principle(s) behind enterprise risk management (ERM)?

A

all of the above

30
Q

General authorization is different from specific authorization. With general authorization an employee in the proper functional area can:

A

all of the above

31
Q

The ERM model includes an element called Risk Response. According to that element, which of the following is an appropriate way to respond to risk?

A

Share the risk with another

32
Q

What is an assumption underlying the valuation of internal controls?

A

The internal control should at least provide reasonable assurance that control problems do not develop

33
Q

Which functions should be segregated?

A

all of the above

34
Q

Which of the following is not a principle applicable to project development and acquisition controls?

A

network management

35
Q

According to sound internal control concepts, which of the following systems duties should be segregated?

A

Answers 1 and 2 are correct

36
Q

Which of the following are internal control functions?

A

all of the above are internal control functions

37
Q

Component 1

A

Control Environment

38
Q

The organization demonstrates a commitment to _____ and ______ _______.

A

integrity; ethical values

39
Q

The board of directors demonstrates ________ from management and ________ ________ of the development and performance of internal control.

A

independence; exercises oversight

40
Q

_________ establishes, with ______ oversight, structures, reporting lines, and appropriate authorities and responsibilities in the _______ __ _________.

A

Management; board; pursuit of objectives

41
Q

The organization demonstrates a commitment to attract, develop, and retain _______ ________ in alignment with objectives.

A

competent individuals

42
Q

The organization _______ ________ ________ for their internal control responsibilities in the pursuit of objectives.

A

holds individuals accountable

43
Q

Component 2

A

Risk Assessment

44
Q

The organization specifies _________ with ________ ________ to enable the identification and assessment of risks relating to objectives.

A

objectives; sufficient clarity

45
Q

The organization _______ _______ to the achievement of its objectives across the entity and ________ _____ as a basis for determining how the risks should be managed.

A

identifies risks; analyzes risks

46
Q

The organization considers the _______ ____ _______ in assessing risks to the achievement of objectives.

A

potential for fraud

47
Q

The organization _______ and _______ _______ that could significantly impact the system of internal control.

A

identifies; assesses changes

48
Q

Component 3

A

Control Activities

49
Q

The organization selects and develops _____ ______ that contribute to the mitigation of risks to the achievement of objectives to _______ ______.

A

control activities; acceptable levels

50
Q

The organization selects and develops general ______ _______ over _______ to support the achievement of objectives.

A

control activities; technology

51
Q

The organization deploys ______ _____ through _____ that establish what is expected and _____ that put policies into action.

A

control activities; policies; procedures

52
Q

Component 4

A

Information and Communication

53
Q

The organization obtains or generates and uses ______, _______ ________ to support the functioning of internal control.

A

relevant; quality information

54
Q

The organization _______ __________ _______, including objectives and responsibilities for internal control, necessary to support the functioning of internal control.

A

internally communicates information

55
Q

The organization ______ with _______ _______ regarding matters affecting the functioning of internal control.

A

communicates; external parties

56
Q

Component 5

A

Monitoring Activities

57
Q

The organization selects, develops, and performs ongoing and/or separate _______ to ascertain whether the _____ of internal control are present and functioning.

A

evaluations; components

58
Q

The organization _____ and ________ internal control ________ in a timely manner to those participants responsible for taking corrective action, including senior management and the board of directors, as appropriate.

A

evaluates; communicates; deficiencies

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