Audit and Assurance Services
Question Bank
Course Introduction
Audit and Assurance Services explores the theoretical foundations and practical applications of auditing within the context of financial reporting and corporate governance. The course covers key principles of audit planning, evidence gathering, risk assessment, and evaluation of internal controls, as well as ethical considerations and professional standards governing auditors. Students examine the different types of assurance services, including statutory audits and other attestation engagements, analyzing their role in enhancing the credibility of information provided to stakeholders. Case studies, real-world scenarios, and contemporary issues further develop students' ability to exercise professional judgment and apply relevant standards in diverse business environments.
Recommended Textbook
Information Technology Auditing 4th Edition by James Hall
Available Study Resources on Quizplus 12 Chapters
1122 Verified Questions
1122 Flashcards
Source URL: https://quizplus.com/study-set/1104
Page 2
Chapter 1: Auditing and Internal Control
Available Study Resources on Quizplus for this Chatper
100 Verified Questions
100 Flashcards
Source URL: https://quizplus.com/quiz/21726
Sample Questions
Q1) A physical inventory count is an example of a
A) preventive control
B) detective control
C) corrective control
D) Feed-forward control
Answer: B
Q2) Explain the purpose of the PCAOB
Answer: The PCAOB is empowered to set auditing, quality control, and ethics standards; to inspect registered accounting firms; to conduct investigations; and to take disciplinary actions.
Q3) Advisory services is an emerging field that goes beyond the auditor's traditional attestation function.
A)True
B)False
Answer: True
Q4) COSO identifies two broad groupings of information system controls. What are they?
Answer: general; application
Q5) Locking petty cash in a safe is an example of __________________________.
Answer: access controls
To view all questions and flashcards with answers, click on the resource link above. Page 3
Chapter 2: Auditing IT Governance Controls
Available Study Resources on Quizplus for this Chatper
91 Verified Questions
91 Flashcards
Source URL: https://quizplus.com/quiz/21727
Sample Questions
Q1) Segregation of duties in the computer-based information system includes
A) separating the programmer from the computer operator
B) preventing management override
C) separating the inventory process from the billing process
D) performing independent verifications by the computer operator
Answer: A
Q2) Fault tolerance is the ability of the system to continue operation when part of the system fails due to hardware failure, application program error, or operator error.
A)True
B)False
Answer: True
Q3) The database administrator should be separated from systems development.
A)True
B)False
Answer: True
Q4) What is the purpose of a data library?
Answer: A data libray is a room adjacent to the computer center that provides safe storage for the off-line data files. The files could be backups or current data files.
To view all questions and flashcards with answers, click on the resource link above. Page 4
Chapter 3: Auditing Operating Systems and Networks
Available Study Resources on Quizplus for this Chatper
105 Verified Questions
105 Flashcards
Source URL: https://quizplus.com/quiz/21728
Sample Questions
Q1) The audit trail for electronic data interchange transactions is stored on magnetic media.
A)True
B)False
Answer: True
Q2) IP spoofing
A) combines the messages of multiple users into a "spoofing packet" where the IP addresses are interchanged and the messages are then distributes randomly among the targeted users.
B) is a form of masquerading to gain unauthorized access to a web server.
C) is used to establish temporary connections between network devices with different IP addresses for the duration of a communication session.
D) is a temporary phenomenon that disrupts transaction processing. It will resolve itself when the primary computer completes processing its transaction and releases the IP address needed by other users.
Answer: B
To view all questions and flashcards with answers, click on the resource link above.
5
Chapter 4: Auditing Database Systems
Available Study Resources on Quizplus for this Chatper
100 Verified Questions
100 Flashcards
Source URL: https://quizplus.com/quiz/21729
Sample Questions
Q1) What is a database authorization table?
Q2) The textbook refers to four interrelated components of the database concept. Which of the following is not one of the components?
A) the database management system
B) the database administrator
C) the physical database
D) the conceptual database
Q3) Why are the hierarchical and network models called navigational databases?
Q4) What are the four primary elements of the database approach?
Q5) The ____________________ allows users to retrieve and modify data easily.
Q6) Contrast the navigational databases with relational databases. What is the primary advantage of the relational model?
Q7) Distinguish between a database lockout and a deadlock.
Q8) In the relational database model all of the following are true except
A) data is presented to users as tables
B) data can be extracted from specified rows from specified tables
C) a new table can be built by joining two tables
D) only one-to-many relationships can be supported
Q9) The __________________________ describes every data element in the database. Page 6
To view all questions and flashcards with answers, click on the resource link above.
Page 7
Chapter 5: Systems Development and Program Change
Activities
Available Study Resources on Quizplus for this Chatper
94 Verified Questions
94 Flashcards
Source URL: https://quizplus.com/quiz/21730
Sample Questions
Q1) Which test of controls will provide evidence that the system as originally implemented was free from material errors and free from fraud? Review of the documentation indicates that
A) a cost-benefit analysis was conducted
B) the detailed design was an appropriate solution to the user's problem
C) tests were conducted at the individual module and total system levels prior to implementation
D) problems detected during the conversion period were corrected in the maintenance phase
Q2) Discuss the three groups that participate in systems development.
Q3) The systems analysis report does not
A) identify user needs
B) specify requirements for the new system
C) formally state the goals and objectives of the system
D) specify the system processing methods
Q4) A tangible benefit
A) can be measured and expressed in financial terms
B) might increase revenues
C) might decrease costs
D) all of the above
To view all questions and flashcards with answers, click on the resource link above. Page 8
Chapter 6: Transaction Processing and Financial Reporting
Systems Overview
Available Study Resources on Quizplus for this Chatper
98 Verified Questions
98 Flashcards
Source URL: https://quizplus.com/quiz/21731
Sample Questions
Q1) If an organization processes large numbers of transactions that use common data records, what type of system would work best (all else being equal)?
Q2) Why is the audit trail necessary?
Q3) The order of the entries made in the general journal is by
A) date
B) account number
C) user
D) customer number
Q4) Batch processing systems can store data on direct access storage devices.
A)True
B)False
Q5) The box symbol represents a temporary file.
A)True
B)False
Q6) Which of the following is a turn-around document?
A) remittance advice
B) sales order
C) purchase order
D) payroll check
Q7) What is XML? Page 9
To view all questions and flashcards with answers, click on the resource link above.
Page 10
Chapter 7: Computer Assisted Audit Tools and Techniques
Available Study Resources on Quizplus for this Chatper
82 Verified Questions
82 Flashcards
Source URL: https://quizplus.com/quiz/21732
Sample Questions
Q1) The firm allows no more than 10 hours of overtime a week. An employee entered "15" in the field. Which control will detect this error?
Q2) Describe parallel simulation.
Q3) The base case system evaluation is a variation of the test data method.
A)True
B)False
Q4) A salami fraud affects a large number of victims, but the harm to each appears to be very small.
A)True
B)False
Q5) If input and processing controls are adequate, why are output controls needed?
Q6) When using the test data method, the presence of multiple error messages indicates a flaw in the preparation of test transactions.
A)True
B)False
Q7) A __________________________ fraud affects a large number of victims but the harm to each appears to be very small.
Q8) What are the three categories of processing control?
Q9) Describe and contrast the test data method with the integrated test facility.
To view all questions and flashcards with answers, click on the resource link above. Page 11
Chapter 8: Data Structures and Caatts for Data Extraction
Available Study Resources on Quizplus for this Chatper
81 Verified Questions
81 Flashcards
Source URL: https://quizplus.com/quiz/21733
Sample Questions
Q1) Explain how linkages between relational tables are accomplished.
Q2) A table is in first normal form when it is
A) free of repeating group data
B) free of transitive dependencies
C) free of partial dependencies
D) free of update anomalies
E) none of the above
Q3) Which of the following statements is not true?
A) Indexed random files are dispersed throughout the storage device without regard for physical proximity with related records.
B) Indexed random files use disk storage space efficiently.
C) Indexed random files are efficient when processing a large portion of a file at one time.
D) Indexed random files are easy to maintain in terms of adding records.
Q4) Give three examples that illustrate how cardinality reflects an organization's underlying business rules.
Q5) What are the two fundamental components of data structures?
Q6) How can a poorly designed database result in unintentional loss of critical records?
To view all questions and flashcards with answers, click on the resource link above. Page 12
Chapter 9: Auditing the Revenue Cycle
Available Study Resources on Quizplus for this Chatper
97 Verified Questions
97 Flashcards
Source URL: https://quizplus.com/quiz/21734
Sample Questions
Q1) The printer ran out of preprinted sales invoice forms and several sales invoices were not printed. The best internal control to detect this error is
A) a batch total of sales invoices to be prepared compared to the actual number of sales invoices prepared
B) sequentially numbered sales invoices
C) visual verification that all sales invoices were prepared
D) none of the above will detect this error
Q2) What is the purpose of the credit memo?
Q3) Which document is NOT prepared by the sales department?
A) packing slip
B) shipping notice
C) bill of lading
D) stock release
Q4) In a manual system, the billing department is responsible for recording the sale in the sales journal.
A)True
B)False
Q5) What makes point-of-sale systems different from revenue cycles of manufacturing firms?
To view all questions and flashcards with answers, click on the resource link above. Page 13
Chapter 10: Auditing the Expenditure Cycle
Available Study Resources on Quizplus for this Chatper
100 Verified Questions
100 Flashcards
Source URL: https://quizplus.com/quiz/21735
Sample Questions
Q1) If a company uses an actual cost system, inventory records can first be updated from the
A) vendor invoice
B) purchase order
C) receiving report
D) purchase requisition
Q2) Payroll processing can be automated easily because accounting for payroll is very simple.
A)True
B)False
Q3) Most payroll systems for mid-size firms use real-time data processing.
A)True
B)False
Q4) Differentiate between a purchase requisition and a purchase order.
Q5) The personnel department authorizes changes in employee pay rates.
A)True
B)False
Q6) Which internally generated documents should be compared to the supplier's invoice to: (1) verify the price of an item and (2) verify the quantity being billed for?
Page 14
To view all questions and flashcards with answers, click on the resource link above.
Chapter 11: Enterprise Resource Planning Systems
Available Study Resources on Quizplus for this Chatper
90 Verified Questions
90 Flashcards
Source URL: https://quizplus.com/quiz/21736
Sample Questions
Q1) The client/server model is a form of network topology in which user computers, called clients, access ERP programs and data via a host computer called a server.
A)True
B)False
Q2) Slicing and dicing permits the disaggregation of data to reveal underlying details.
A)True
B)False
Q3) In a two-tier architecture approach is used primarily for wide area network (WAN) applications.
A)True
B)False
Q4) Goals of ERP include all of the following except
A) improved customer service
B) improvements of legacy systems
C) reduced production time
D) increased production
Q5) How are OLTP and OLAP different? Give examples of their use.
Q6) Why do ERP systems need bolt-on software? Give an example.
To view all questions and flashcards with answers, click on the resource link above. Page 15
Chapter 12: Business Ethics, Fraud, and Fraud Detection
Available Study Resources on Quizplus for this Chatper
84 Verified Questions
84 Flashcards
Source URL: https://quizplus.com/quiz/21737
Sample Questions
Q1) Why are the computer ethics issues of privacy, security, and property ownership of interest to accountants?
Q2) When certain customers made cash payments to reduce their accounts receivable, the bookkeeper embezzled the cash and wrote off the accounts as uncollectible. Which control procedure would most likely prevent this irregularity?
A) segregation of duties
B) accounting records
C) accounting system
D) access controls
Q3) Cash larceny involves
A) stealing cash from an organization before it is recorded.
B) stealing cash from an organization after it has been recorded.
C) manufacturing false purchase orders, receiving reports, and invoices.
D) a clerk paying a vendor twice for the same products and cashing the reimbursement check issued by the vendor.
Q4) Opportunity involves direct access to assets and/or access to information that controls assets.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 16