Midterms (T/F)

Question 1

Preventive controls are passive techniques designed to reduce fraud.

True
False

Answer 1

True

Question 2

A key modifying assumption in internal control is that the internal control system is the responsibility of management.

True
False

Answer 2

True

Question 3

A qualified opinion on management’s assessment of internal controls is over the financial reporting system necessitates a qualified opinion on the financial statements.

True
False

Answer 3

False

Question 4

IT auditing is a small part of most external and internal audits.

True
False

Answer 4

False

Question 5

An IT auditor expresses an opinion on the fairness of the financial statements.

True
False

Answer 5

False

Question 6

Segregation of duties is an example of an internal control procedures.

True
False

Answer 6

True

Question 7

The same internal control objectives apply to manual and computer-based information systems.

True
False

Answer 7

True

Question 8

Corporate management (including the CEO) must certify monthly and annually their organization’s internal controls over financial reporting.

True
False

Answer 8

False

Question 9

Application controls apply to a wide range of exposures that threaten the integrity of all programs processed within the computer environment.

True
False

Answer 9

False

Question 10

To fulfill the segregation of duties control objective, computer processing/functions (like authorization of credit and billing) are separated.

True
False

Answer 10

False

Question 11

Distributed data processing places the control IT resources under end users.

True
False

Answer 11

True

Question 12

RAID is the use of parallel disks that contain redundant elements of data applications.

True
False

Answer 12

True

Question 13

A database administrator is responsible for the receipt, storage, retrieval, and custody of data files.

True
False

Answer 13

False

Question 14

Commodity IT assets include such things are network management.

True
False

Answer 14

True

Question 15

Transaction cost economics (TCE) theory suggests that firm should outsource specific non core IT assets.

True
False

Answer 15

False

Question 16

The database administrator should be separated from systems development.

True
False

Answer 16

True

Question 17

To ensure sound internal control, program coding and program processing should be separated.

True
False

Answer 17

True

Question 18

A disaster recovery plan is a comprehensive statement of all actions to be taken after a disaster.

True
False

Answer 18

True

Question 19

Test of controls determine whether the database contents fairly reflect the organization’s transactions.

True
False

Answer 19

False

Question 20

Commodity IT assets acquired in the marketplace should be outsourced under the core competency theory.

True
False

Answer 20

False