Accounting Data Analytics
Exam Answer Key
Course Introduction
Accounting Data Analytics explores the integration of data analysis techniques within the field of accounting to support decision-making and enhance business outcomes. The course introduces students to key topics such as data collection, cleaning, visualization, and interpretation using real-world accounting data. Emphasis is placed on utilizing popular software and analytical tools to identify trends, detect anomalies, and provide actionable insights for financial reporting, auditing, and managerial accounting. Through case studies, hands-on projects, and practical applications, students learn to bridge the gap between traditional accounting functions and the evolving landscape of data-driven analysis.
Recommended Textbook
Accounting Information Systems 14th GLOBAL Edition by Marshall B. Romney
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Chapter 1: Conceptual Foundations of Accounting Information Systems
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Sample Questions
Q1) When properly deployed,accounting information systems can provide firms with a competitive advantage.
A)True
B)False
Answer: True
Q2) Which of the following is not one of the three basic types of data about a specific sales transaction that should be captured by an Accounting Information System?
A)name of the employee who completed the sale
B)daily sales quota
C)product sold
D)date
Answer: B
Q3) An AIS that makes information more easily accessible and more widely available is likely to increase pressure for
A)centralization and defined procedures.
B)centralization and autonomy.
C)decentralization and defined procedures.
D)decentralization and autonomy.
Answer: D
Page 3
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Chapter 2: Overview of Transaction Processing and Enterprise Resource Planning Systems
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Sample Questions
Q1) What is a turnaround document? Provide at least one example of a turnaround document.
Answer: Turnaround documents are company output sent to an external party,who often adds data to the document,and then are returned to the company as an input document.Students answer may vary based on the examples they provide.
Q2) What is the purpose of source documents? What controls are embedded in source documents? Give two examples of source documents.
Answer: The primary purpose of source documents is to record data about business activities.Source documents standardize data collection procedures for an organization and provide better control and accuracy.Source documents are generally pre-numbered,which helps to verify that all transactions have been recorded and there is no missing document; if a document is missing,then which one(s)can be determined.Proper design of source documents ensures which information to collect,preprints standard information such as addresses,and provides directions for completing the form.Examples include: invoices,timecards,sales orders,and purchase orders.
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Chapter 3: Systems Documentation Techniques
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Sample Questions
Q1) What does the Sarbanes-Oxley Act require that is relevant to documentation tools?
Answer: The Sarbanes-Oxley Act requires that independent auditors understand the automated and manual procedures an entity uses.One of the best ways to gain this understanding is to use the flowcharts to document the internal control system,as weaknesses and strengths are more easily spotted from such graphic portrayals.
Q2) Discuss the ways in which information professionals interact with documentation tools and the various levels of understanding necessary.
Answer: At a minimum,a professional should be able to read documentation.A professional may also be called upon to evaluate internal control system documentation in order to identify control strengths and weaknesses or recommend improvements.A professional may be engaged to prepare documentation,which requires the greatest amount of skill and understanding of a particular system.
Q3) The Sarbanes-Oxley Act requires auditors to create flowcharts to document business processes.
A)True
B)False
Answer: False
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Chapter 4: Relational Databases
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Sample Questions
Q1) Abby Burke has created custom statues made out of scrap metal for over ten years.Abby has kept detailed records of every statue she has ever created.For every sale,she obtains the customer's name and address,a description of the statue,and a picture of the statue sold to the customer.Her unique style has recently attracted the attention of several celebrities.Ready to take her business to the next level,Abby has hired you to construct an accounting information system,which she wants modeled after her paper records.As you look over her records,you notice that some customer last names have different first names in different records.For example,R.Framington Farnsworth,Bob Farnsworth,and Sam Farnsworth all seem to be the same person.You explain to Abby that every customer must be identified by a unique customer number in the AIS.You are referring to the
A)entity integrity rule.
B)referential integrity rule.
C)update anomaly.
D)insert anomaly.
Q2) The physical view of a database system refers to
A)how a user or programmer conceptually organizes and understands the data.
B)how the DBMS accesses data for a certain application program.
C)how and where the data are physically arranged and stored.
D)how master files store data values used by more than one application program.
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Page 6
Chapter 5: Computer Fraud
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Sample Questions
Q1) What agency did the United States create to use cyber weapons and to defend against cyber attacks?
A)U.S. Cyber Command
B)Department of Network Security
C)Department of Cyber Defense
D)Department of Technology Strategy
Q2) The activist hacker group called Anonymous played Santa Claus one Christmas,indicating they were "granting wishes to people who are less fortunate than most." They were inundated with requests for iPads,iPhones,pizzas,and hundreds of other things.They hacked into banks and sent over $1 million worth of virtual credit cards to people.
A)True
B)False
Q3) Which situation below makes it easy for someone to commit a fraud?
A)Placing excessive trust in key employees.
B)Inadequate staffing within the organization.
C)Unclear company policies.
D)All of the above situations make it easy for someone to commit a fraud.
Q4) Explain the impact of SAS No.99 on auditors' responsibilities.
Q5) Describe some of the most frequent fraudulent financial reporting schemes.
Page 7
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Chapter 6: Computer Fraud and Abuse Techniques
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Sample Questions
Q1) Gaining control of somebody's computer without their knowledge and using it to carry out illicit activities is known as A)hacking.
B)spamming.
C)posing.
D)hijacking.
Q2) Jerry Schneider was able to amass operating manuals and enough technical data to steal $1 million of electronic equipment by A)scavenging.
B)skimming.
C)Internet auction fraud.
D)cyber extortion.
Q3) Computer fraud perpetrators that modify programs during systems development,allowing access into the system that bypasses normal system controls are using
A)a Trojan horse.
B)a trap door.
C)the salami technique.
D)superzapping.
Q4) Describe ways to help minimize social engineering.
Page 8
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Chapter 7: Control and Accounting Information Systems
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Sample Questions
Q1) Explain how a company could safeguard its assets,records,and data.
Q2) COSO requires that any internal deficiencies identified through monitoring be reported to whom?
A)The external auditor.
B)The company's management.
C)The board of directors.
D)The audit committee.
Q3) According to the COSO Enterprise Risk Management Framework,the risk assessment process incorporates all of the following components except
A)reporting potential risks to auditors.
B)identifying events that could impact the enterprise.
C)evaluating the impact of potential events on achievement of objectives.
D)establishing objectives for the enterprise.
Q4) The primary purpose of the Foreign Corrupt Practices Act of 1977 was
A)to require corporations to maintain a good system of internal control.
B)to prevent the bribery of foreign officials by American companies.
C)to require the reporting of any material fraud by a business.
D)All of the above are required by the act.
Q5) Describe the reasons organizations have not adequately protected data.
Q6) Why are most fraud not being reported or prosecuted?
Page 9
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Chapter 8: Controls for Information Security
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Sample Questions
Q1) ________ is/are an example of a detective control.
A)Physical access controls
B)Encryption
C)Emergency response teams
D)Log analysis
Q2) An access control matrix
A)is the process of restricting access of authenticated users to specific portions of the system and limiting what actions they are permitted to perform.
B)is used to implement authentication controls.
C)matches the user's authentication credentials to his authorization.
D)is a table specifying which portions of the system users are permitted to access.
Q3) Identify the primary means of protecting data stored in a cloud from unauthorized access.
A)authentication
B)authorization
C)virtualization
D)securitization
Q4) Describe what information security process the term hardening refers to.
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Chapter 9: Confidentiality and Privacy Controls
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Sample Questions
Q1) Information rights management software can do all of the following except
A)limiting access to specific files.
B)limit action privileges to a specific time period.
C)authenticate individuals accessing information.
D)specify the actions individuals granted access to information can perform.
Q2) Encryption is one of the many ways to protect information in transit over the internet.
A)True
B)False
Q3) Describe some steps you can take to minimize your risk of identity theft.
Q4) Encryption has a remarkably long and varied history.The invention of writing was apparently soon followed by a desire to conceal messages.One of the methods,was the simple substitution of numbers for letters,for example A = 1,B = 2,etc.This is an example of A)a hashing algorithm.
B)symmetric key encryption.
C)asymmetric key encryption.
D)a public key.
Q5) Discuss the most important control for protecting confidentiality.
Q6) Compare the advantages and disadvantage of symmetric and asymmetric encryption.
Page 11
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Chapter 10: Processing Integrity and Availability Controls
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Sample Questions
Q1) A ________ determines if all required data items have been entered.
A)completeness check
B)field check
C)limit check
D)range check
Q2) A ________ determines the correctness of the logical relationship between two data items.
A)field check
B)alpha-numeric check
C)range check
D)reasonableness test
Q3) A copy of a database,master file,or software that will be retained indefinitely as a historical record is known as a(n)
A)archive.
B)cloud computing.
C)differential backup.
D)incremental backup.
Q4) Best practice requires backups be retained indefinitely.
A)True
B)False
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Chapter 11: Auditing Computer-Based Information Systems
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Sample Questions
Q1) Which of the following is not one of the types of internal audits?
A)A review of the corporate organizational structure and reporting hierarchies.
B)An examination of procedures for reporting and disposing of hazardous waste.
C)A review of source documents and general ledger accounts to determine integrity of recorded transactions.
D)A comparison of estimates and analysis made before purchase of a major capital asset to actual numbers and results achieved.
Q2) With regards to an accounting information system,a financial audit is most concerned with
A)the system's output.
B)the system's input.
C)the system's processing.
D)the system's storage.
Q3) The ________ audit examines the reliability and integrity of accounting records.
A)financial
B)informational
C)information systems
D)operational
Q4) Describe some of the important uses of CAATs.
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Chapter 12: The Revenue Cycle: Sales to Cash Collections
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Q1) An ________ is an arrangement where a bank receives customer payments and transmits payment data to the organization.
A)e-commerce
B)electronic funds transfer (EFT)
C)electronic lockbox
D)electronic data interchange (EDI)
Q2) Identify a useful tool for monitoring accounts receivable.
A)ERP exception report
B)accounts receivable aging report
C)accounts receivable tolerance report
D)customer credit limit report
Q3) The ________ should always be included with a merchandise shipment to a customer.
A)picking ticket
B)packing slip
C)sales invoice
D)remittance advice
Q4) What is QR codes and can companies use them to improve interactions with their customers?
Q5) Describe typical credit approval procedures.
Page 14
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Chapter 13: The Expenditure Cycle: Purchasing to Cash
Disbursements
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Sample Questions
Q1) Identify the department below that should not be able to submit a purchase requisition.
A)Marketing
B)Production
C)Inventory Control
D)None of the above
Q2) Once a purchase request is approved,what is the next step?
A)The system creates a purchase order.
B)The accounts payable department approves the purchase request, creating a purchase order.
C)The inventory master file is accessed to find the preferred supplier(s).
D)The department that created the purchase request may buy the requested item(s).
Q3) In a supplier audit,what are some of the red flags that could indicate potential supplier's problems?
Q4) The EOQ approach to managing inventory has been gaining popularity in recent years.
A)True
B)False
Q5) Define and describe the EOQ approach to inventory management.
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Chapter 14: The Production Cycle
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Q1) Which of the following is not proposed to be an advantage of activity-based costing?
A)Better product mix decisions.
B)Better product pricing decisions.
C)Less complex than traditional cost systems.
D)Better decision.
Q2) What issue did Airbus encounter when using CAD software to help design the A380 Superjumbo airliner?
A)The actual A380 was heavier than the CAD model.
B)The actual A380 was not able to carry as much weight as the CAD model.
C)Design teams used different versions of the same CAD software, resulting in key information loss.
D)The CAD software was not advanced enough to help design the A380.
Q3) Identify one control that can be used to mitigate the threat of poor product design that results in excess costs.
A)production planning systems
B)analysis of warranty and repair costs
C)encryption
D)insurance
Q4) Identify and discuss the two common methods of production planning.
Page 16
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Chapter 15: The Human Resources Management and Payroll Cycle
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Q1) A growing number of companies require some of their upper level executives to spend time performing job duties of rank-and-file employees.When the vice president of DaVita Inc.,a major provider of dialysis treatment,spent three days working in one of the company's clinics,she understood
A)that the company's polyester uniform caused her to sweat a great deal.
B)evidence of fraud in several clinic locations.
C)how the need to respond to life-threatening emergencies can result in delays in completing corporate-mandated reports.
D)situations where employees were treating customers properly.
Q2) Payroll deductions fall into the broad categories of ________ and ________.
A)payroll tax withholdings; voluntary deductions
B)unemployment; social security taxes
C)unemployment taxes; income taxes
D)voluntary deductions; income taxes
Q3) Companies that specialize in processing payroll are known as
A)paycheck distribution companies.
B)payroll service bureaus.
C)professional employer organizations.
D)semi-governmental organizations.
Page 17
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Chapter 16: General Ledger and Reporting System
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Sample Questions
Q1) Identify the year the SEC will require American companies to switch from U.S.-based GAAP to IFRS as the basis for preparing financial statements.
A)2016
B)2018
C)2020
D)At this point it is unclear when the SEC will require American companies to implement IFRS, though the SEC remains committed to requiring U.S. companies use IFRS at some point.
Q2) What is responsibility accounting?
Q3) Who should provide the adjusting entries in a well-designed general ledger and reporting system?
A)Various user departments.
B)The treasurer department.
C)Anyone who has access to the other major AIS subsystems.
D)The controller office.
Q4) Periodic account reconciliations are a control that can be used to reduce the risk of employees creating unauthorized adjusting entries.
A)True
B)False
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Chapter 17: Database Design Using the Rea Data Model
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Q1) Which is a true statement about the REA data model?
A)The REA data model classifies entities into three distinct categories.
B)The term REA is an acronym that stands for resources, entities, and agents.
C)Using an REA data model is not helpful when creating an R-E diagram.
D)The term REA is an acronym that stands for resources, entities, and activities.
Q2) Assume that you are looking at a REA diagram that depicts only one event.Which of the following must be on the REA diagram?
A)An external agent.
B)An internal agent.
C)both A and B
D)neither A nor B
Q3) Describe what is a E-R diagram and provide an example.
Q4) In which stage(s)of the database design process does data modeling occur?
A)During the systems analysis stage.
B)During the design stage.
C)During both the systems analysis and design stages.
D)After the design stage.
Q5) What is Cardinalities?
Q6) Describe the possible relationships between entities,in terms of cardinalities.
Page 19
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Chapter 18: Implementing an Rea Model in a Relational Database
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Sample Questions
Q1) A query that extracts,for a given time period,all purchases for which there is no corresponding disburse cash event will yield
A)a cash account ledger.
B)a credit sales journal.
C)an accounts receivable ledger.
D)an accounts payable journal.
Q2) Identify the attribute below that would not make a good primary key.
A)Birthdate.
B)Social security number.
C)A unique number automatically generated by the system.
D)Cell phone number.
Q3) Which of the following attributes would typically be included in the table that stores data about the Customer entity in a relational database?
A)Invoice number.
B)Credit limit.
C)Product code.
D)Backorder.
Q4) Explain a completeness check.
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Q5) What are the advantages of the REA data model over the traditional AIS model?
Chapter 19: Special Topics in Rea Modeling
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Q1) Supplier number is most likely to be a foreign key in
A)Inventory-Request_Inventory.
B)Receive Inventory.
C)Supplier.
D)Warehouse.
Q2) Relationships between resources and agents,such as Inventory and Supplier,reflect the best practice of identifying preferred and alternative suppliers for specific inventory items.Similar relationships between resources and employees can be used to model ________ and ________.
A)cost; revenue
B)performance; behavior
C)responsibility; accountability
D)segregation of duties; internal control
Q3) Sales order number is most likely to be a primary key in which entity of an expanded revenue cycle REA diagram?
A)Call on Customers.
B)Fill Customer Order.
C)Ship Order.
D)Take Customer Order.
Q4) What are the benefits of an integrated enterprise-wide data model?
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Chapter 20: Introduction to Systems Development and Systems Analysis
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Q1) Identify the form of user resistance that occurs when the new system is blamed for any unpleasant occurrence.
A)Passive-aggression.
B)Persistent.
C)Protest.
D)Projection.
Q2) Which of the following statements about systems development is true?
A)Planning throughout the systems development life cycle promotes coordination between systems and strategic plans.
B)Organizations should conduct systems development activities at least once every five years.
C)The systems development steps are critical for profit-oriented businesses, but are too expensive and time consuming for most not-for-profit organizations.
D)Diligently following the steps and suggestions in the systems development life cycle ensures the final system will meet user needs and be implemented at or below the budgeted cost.
Q3) Describe guidelines that an organization can follow to prevent behavioral problems when implementing a system.
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Chapter 21: Ais Development Strategies
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Q1) Which of the following is a method for comparing alternative vendor proposals for development of an accounting information system when the vendors differ with regard to their ability to meet the project criteria?
A)Point scoring.
B)Resource clearing.
C)Requirements costing.
D)Multi-objective optimization.
Q2) ________ are one example of a cloud computing solution.
A)Application service providers
B)Turnkey vendors
C)SDLC implementations
D)Canned software providers
Q3) What guidelines should be followed when contracting with an outside developer to create custom software?
Q4) Why does Pepsi create most of the software it uses in business operations?
A)Pepsi does not trust canned software.
B)Using canned software actually cost Pepsi more than using custom software.
C)Pepsi could not find canned software sophisticated enough to meet its needs.
D)There is no canned software available in Pepsi's industry.
Q5) Describe the advantages and disadvantages of outsourcing.
Page 23
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Chapter 22: Systems Design, implementation, and Operation
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Q1) What are the purposes of a conceptual systems design report?
Q2) Which of the following is the most costly and least risky method of converting from one system to another?
A)Direct conversion.
B)Parallel conversion.
C)Pilot conversion.
D)Phase-in conversion.
Q3) The hidden cost of inadequate training is that users turn for help to coworkers who have mastered the system,decreasing the productivity of coworkers and increasing company costs.
A)True
B)False
Q4) ________ is a process used to uncover and eliminate program errors.
A)Black box testing
B)Debugging
C)Desk checking
D)White box testing
Q5) Describe at least four considerations during controls design.
Q7) Describe the approaches to system conversion. Page 24
Q6) How can accountants help in the systems development life cycle (SDLC)process?
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