Accounting Information Systems
10th Edition
ISBN: 9781337619202
Author: Hall, James A.
Publisher: Cengage Learning,
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Chapter 16, Problem 10MCQ
To determine
Identify the statement which is not correct about the ITF technique for testing.
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Auditors of ERP systemsa. need not be concerned about segregation of duties because these systems possess strong computer controls.b. focus on output controls such as independent verification to reconcile batch totals.c. are concerned that managers fail to exercise adequate care in assigning permissions.d. do not see the data warehouse as an audit or control issue at all because financial records are not stored there.e. need not review access levels granted to users because these are determined when the system is configured and never change.
When an auditor tests the internal controls of a computerized accounting system, which of the following is true of the test data approach?
A. Test data are coded to a dummy subsidiary so they can be extracted from the system under actual operating conditions.
B. Test data programs need NOT be tailor-made by the auditor for each client's computer applications.
C. Test data programs usually consist of all possible valid and invalid conditions reguarding compliance with internal controls.
D. Test data are processed with the client's computer and the results are compared with the auditor's predetermined results.
Among the client electronic data processing (EDP) systems listed below, which one can typically undergo an audit without the need for examining or directly testing the EDP computer programs of the system?
Select one:
a.
A system that updates a few essential master files and produces no printed output other than final balances.
b.
A system that affects a number of essential master files and produces a limited output.
c.
A system that performs relatively uncomplicated processes and produces detailed output.
d.
A system that performs relatively complicated processing and produces very little detailed output.
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Chapter 16 Solutions
Accounting Information Systems
Ch. 16 - Prob. 1RQCh. 16 - Prob. 2RQCh. 16 - Prob. 3RQCh. 16 - Prob. 4RQCh. 16 - Prob. 5RQCh. 16 - Prob. 6RQCh. 16 - Prob. 7RQCh. 16 - What is the importance of the SPL?Ch. 16 - Prob. 9RQCh. 16 - Prob. 10RQ
Ch. 16 - Prob. 11RQCh. 16 - Prob. 12RQCh. 16 - What tests may be conducted for identifying...Ch. 16 - Prob. 14RQCh. 16 - Prob. 15RQCh. 16 - Prob. 16RQCh. 16 - Prob. 17RQCh. 16 - Prob. 18RQCh. 16 - Prob. 19RQCh. 16 - Prob. 20RQCh. 16 - Prob. 1DQCh. 16 - Prob. 2DQCh. 16 - Prob. 3DQCh. 16 - What are rounding error routines, and why are they...Ch. 16 - Prob. 5DQCh. 16 - Prob. 6DQCh. 16 - Prob. 7DQCh. 16 - Prob. 8DQCh. 16 - The systems development life cycle is a...Ch. 16 - Prob. 10DQCh. 16 - Prob. 11DQCh. 16 - Compare and contrast the following techniques...Ch. 16 - Prob. 13DQCh. 16 - Prob. 1MCQCh. 16 - Prob. 2MCQCh. 16 - Which of the following is NOT an SDLC controllable...Ch. 16 - Prob. 4MCQCh. 16 - Which of the following statements is NOT correct?...Ch. 16 - Prob. 6MCQCh. 16 - Prob. 7MCQCh. 16 - Prob. 8MCQCh. 16 - Prob. 9MCQCh. 16 - Prob. 10MCQCh. 16 - Prob. 1PCh. 16 - Prob. 2PCh. 16 - Prob. 3PCh. 16 - Prob. 4PCh. 16 - Prob. 5PCh. 16 - Prob. 6PCh. 16 - Prob. 7PCh. 16 - Prob. 8PCh. 16 - Prob. 9PCh. 16 - The Balcar Companys external auditors are...Ch. 16 - Prob. 11PCh. 16 - Prob. 12PCh. 16 - Prob. 13PCh. 16 - Prob. 14PCh. 16 - Prob. 15PCh. 16 - Prob. 16PCh. 16 - Prob. 17PCh. 16 - Prob. 18P
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- Which of the following statements is NOT correct? a. EAMs capture transactions during processing without removing the application from service. b. EAMs support continuous monitoring of controls. c. EAMs have the potential to corrupt corporate databases d. EAMs decrease operational performance. e. All of the above are correct statements.arrow_forwardWhich of the following statements is most accurate? a. ERP systems are commercial software packages that are sometimes called turnkey systems because they can be implemented by the user with little or no modification. b. Substantive tests provide evidence focused on the system controls. c. Public accounting firms that provide attest services are not allowed under SOX to offer IT advisory services. d. Both small and large firms that have standardized information needs are potential customers for commercial software. e. External auditors may rely on the work of internal auditors only if they report to the controller or the CEO of the client company.arrow_forwardAmong the client electronic data processing (EDP) systems listed below, which one can typically undergo an audit without the need for examining or directly testing the EDP computer programs of the system?Select one: a. A system that updates a few essential master files and produces no printed output other than final balances. b. A system that affects a number of essential master files and produces a limited output. c. A system that performs relatively uncomplicated processes and produces detailed output. d. A system that performs relatively complicated processing and produces very little detailed output.arrow_forward
- 1. If detective controls signal error flags, why shouldn’t these types of controls automatically make a correction in the identified error? Why are corrective controls necessary? 2. Discuss the nonaccounting services that external auditors are no longer permitted to render to audit clients. 3. Discuss whether a firm with fewer employees than there are incompatible tasks should rely more heavily on general authority than specific authority. 4. According to SAS 78/COSO, the proper segregation of functions is an effective internal control procedure. Please Discuss. PLEASE NO PLAGIARSIM. THANK YOU!!arrow_forwardA primary advantage of using generalized audit software packages to audit the financial statements of a client that uses a computer system is that the auditor may: a.Access information stored on computer files while having a limited understanding of the client’s hardware and software features. b.Consider increasing the use of substantive tests of transactions in place of analytical procedures. c.Substantiate the accuracy of data through selfchecking digits and hash totals. d.Reduce the level of required tests of controls to a relatively small amount.arrow_forwardWhen using test data, why are audit teams required to prepare only one transaction to test each IT control?a. The speed and efficiency of the computer results in reduced sample sizes.b. The risk of misstatement is typically lower in an IT environment.c. Audit teams generally perform more extensive substantive testing in an IT environment, resulting in less need to test processing controls.d. In an IT environment, each transaction is handled in an identical manner.arrow_forward
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