Internal Controls and Accounting Systems
Textbook Exam Questions
Course Introduction
This course examines the principles and practices of internal control systems and their critical role in effective accounting operations. Students will explore frameworks for designing, implementing, and evaluating internal controls to safeguard assets, ensure the reliability of financial records, and achieve organizational objectives. Topics include risk assessment, control activities, information and communication processes, and monitoring activities. The course also covers compliance with regulatory requirements and the integration of accounting systems to enhance transparency and operational efficiency, providing students with practical skills to identify weaknesses and recommend improvements within various business environments.
Recommended Textbook
Accounting Information Systems 11th Edition by George H. Bodnar
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14 Chapters
1942 Verified Questions
1942 Flashcards
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Page 2
Chapter 1: Accounting Information Systems: An Overview
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161 Verified Questions
161 Flashcards
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Sample Questions
Q1) XBRL is a language that facilitates the exchange of financial statements over the Internet.
A)True
B)False
Answer: True
Q2) Material requirements planning software assists management in managing A) inventories.
B) overhead.
C) scheduling production.
D) both inventories and scheduling production.
Answer: D
Q3) Green IT is concerned with reducing ________ through recycling and reusing electronic products rather than discarding these products.
Answer: E-WASTE
Q4) The purpose of the ________ approach is to assist in the orderly development of effective systems.
Answer: systems
Q5) The IT benefits for AISs are ________,________,and ________.
Answer: automation,information organization,and communication
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Chapter 2: Systems Techniques and Documentation
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134 Verified Questions
134 Flashcards
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Sample Questions
Q1) The acronym for the organization responsible for standardizing flowchart symbols is A) FASB.
B) ANSI.
C) AICPA.
D) CMA.
Answer: B
Q2) The business process diagram focuses on the sequence of activities in a business process.
A)True
B)False
Answer: True
Q3) In an analytic flowchart,the symbol which could be used to indicate unclaimed payroll checks is the
A) connector symbol.
B) terminal symbol.
C) document symbol.
D) process symbol.
Answer: C
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Chapter 3: Ebusiness and Ecommerce
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119 Verified Questions
119 Flashcards
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Sample Questions
Q1) The enterprise architecture involves five enterprise architectural domains.
A)True
B)False
Answer: False
Q2) The relational data model is a three-dimensional structure similar in look to that of a cube.
A)True
B)False
Answer: False
Q3) In a relational database model,operations on data are performed by using A) EA.
B) Java.
C) SQL.
D) UML.
Answer: C
Q4) Whereas ________ signatures are relatively easy to forge,________ signatures are next to impossible to forge.
Answer: handwritten; digital
Q5) Digital IDs are issued by a(n)________ ________.
Answer: certifying authority
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Chapter 4: Transaction Processing and the Internal Control Process
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133 Verified Questions
133 Flashcards
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Sample Questions
Q1) The production cycle is defined as the events related to the distribution of goods and services to other entities and the collection of related payments.
A)True
B)False
Q2) Control is established in the budgeting process by comparing the results of activity to the budget for each activity.
A)True
B)False
Q3) Application controls are often classified as
A) general, processing, and specific.
B) basic, specific, and accounting.
C) general, application, and output.
D) input, processing, and output.
Q4) Some believe that every corporation has its own corporate culture,and it is such a culture that ultimately either promotes or hinders ethical behavior within the corporation.
A)True
B)False
Page 6
Q5) Fraud examination draws on the fields of ________,________,and ________.
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Chapter 5: Fraud Examination and Fraud Management
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132 Verified Questions
132 Flashcards
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Sample Questions
Q1) Roughly half of all financial statement frauds involve overstating ________.
Q2) Individuals who respond more to audio stimuli typically look down and to the right,or simply vertically to the right,when recalling information.
A)True
B)False
Q3) Tracing involves beginning with a source document and following the related transaction through the entire accounting cycle.
A)True
B)False
Q4) Data-driven fraud detection involves the formal analysis of small sets of data in search for fraud indicators.
A)True
B)False
Q5) Physical and document evidence include audio or video recordings of suspects' activities.
A)True
B)False
Q6) ________ ________ ________ can involve misappropriation of waste,scrap,and spoiled goods.
Page 7
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Chapter 6: Information Systems Security
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170 Verified Questions
170 Flashcards
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Sample Questions
Q1) Intruders who attack information systems for fun and challenge are known as hackers.
A)True
B)False
Q2) Passive threats include information systems fraud and computer sabotage.
A)True
B)False
Q3) In a denial of service attack,an intruder is denied access to an organization's Web site after the intruder attempts to break through its firewalls and proxy server countermeasures.
A)True
B)False
Q4) General security procedures are essential in Internet security.One especially important weakness that hackers may attempt to exploit in this area is to
A) guess at passwords.
B) rewrite computer source code.
C) alter log files to "cover their tracks."
D) steal the hard drives of personal computers used as Web servers.
Q5) The least common method used to commit computer fraud is ________
8
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Chapter 7: Electronic Data Processing Systems
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126 Verified Questions
126 Flashcards
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Sample Questions
Q1) The Internet has enhanced the real-time sales system by extending it to customers who are off-site.
A)True
B)False
Q2) ________ ________ input sales data into the computer system for processing immediately at the time and point of sale.
Q3) An electronic processing system can be used
A) only in a batch environment.
B) with real-time, on-line processing.
C) in either a batch or real-time, on-line processing environment.
D) in situations where documentation is not a priority.
Q4) Paid customer invoice records are retained on-line for a year and are available for inquiries.
A)True
B)False
Q5) A transmission acknowledgment reports in detail the items in the received message.
A)True
B)False
Q6) Users interactively input data in ________ ________ systems.
Page 9
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Chapter 8: Revenue Cycle Processes
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125 Verified Questions
125 Flashcards
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Sample Questions
Q1) Sarbanes-Oxley compliance requires companies maintain an adequate internal control structure over the business processes that support financial reporting.
A)True
B)False
Q2) The mail room prepares a(n)________ ________ that documents payments received.
Q3) The control of actual cash (as opposed to checks)received in the mail relies largely on direct supervision.
A)True
B)False
Q4) In the shipping step of the customer order business management process,the ERP may recheck the availability of goods to ensure that delivery is immediately possible.
A)True
B)False
Q5) Cash sales should be recorded in a cash register or other secure device that can provide immediate documentation of the sales.
A)True
B)False
Q6) SAP ERP features powerful database ________ capabilities.
Page 10
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Chapter 9: Procurement and Human Resources Business
Processes
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118 Verified Questions
118 Flashcards
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Sample Questions
Q1) For compliance with SOX,assessed risk for business processes must be clearly
A) tested and reported to FASB.
B) documented on form Circular E and submitted to the SEC.
C) tested and checked for material irregularities.
D) documented and controls selected for testing and evaluation.
Q2) An outline agreement detailing the total quantity of material to be ordered over a period of time is a
A) quantity contract.
B) value contract.
C) scheduling agreement.
D) subcontract.
Q3) In a negative timekeeping system only exceptions are recorded.
A)True
B)False
Q4) The department responsible for authorizing employee pay deductions is the A) payroll department.
B) personnel department.
C) independent paymaster.
D) production department (for factory workers).
Q5) SAP ERP contains the ________ and the ________ HR modules.
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Chapter 10: The Production Business Process
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127 Verified Questions
127 Flashcards
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Sample Questions
Q1) Which of the following is not a common internal accounting control procedure in a property business process?
A) Having physical inventories of property taken periodically under the supervision of staff who are responsible for the custody of the assets
B) Requiring authorization by an official or committee for expenditures over a certain amount
C) Reconciling detailed subsidiary property records with the control accounts at least annually
D) Having the property appraised periodically for insurance purposes
Q2) In a production planning system,output from the production planning program includes which of the following?
A) Production loading file
B) Routings
C) Completed production order file
D) Finished goods stock status report
Q3) EAN-13 is a bar coding standard which is a superset of the original 12-digit UPC system.
A)True
B)False
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Page 12
Chapter 11: Systems Planning, analysis, and Design
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161 Verified Questions
161 Flashcards
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Sample Questions
Q1) BPEL is supported by the internationally recognized and leading IT open standards organization called
A) OASIS.
B) OMG.
C) MDA.
D) QVT.
Q2) ________ diagrams are used to document objects (and classes of objects)and how they communicate with each other.
A) UML
B) ER
C) Conceptual
D) Data flow
Q3) It is important to design system reports that have appropriate titles and captions.
A)True
B)False
Q4) A small change in an area of weakness that may result in major improvements is called a(n)________.
Q5) What individuals should be involved in systems planning?
Q6) What are the differences between logical flow diagrams and analytic flowcharts?
Page 13
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Chapter 12: Systems Project Management, implementation,
operation, control
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133 Verified Questions
133 Flashcards
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Sample Questions
Q1) The operational principle behind factoring a project into phases and tasks is A) top-down design with successive refinement. B) to schedule all activities according to CPM methodology. C) that each specific task or phase should provide a deliverable at its completion. D) to use analytic flowcharts to factor a project into modules.
Q2) If data are input into the project accounting system that is both accurate and timely,it can produce revised cost estimates that are both accurate and timely.
A)True
B)False
Q3) Audits of information systems often focus on internal control. A)True B)False
Q4) The test data approach should not be designed to "break" the computer program. A)True B)False
Q5) The development of computer software without ________ is an almost worthless exercise.
Page 14
Q6) ________ is a successive refinement to the project plan.
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Chapter 13: Data Management Concepts
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143 Verified Questions
143 Flashcards
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Sample Questions
Q1) OLAP is a multidimensional generalization of the 2-dimensional ________ table.
Q2) When the entire database is loaded into computer-internal high-speed random access memory or other high speed electronic storage device,it is called ________ database.
Q3) A row in a relational database table is called a(n)________.
Q4) Fields associated with other fields in a logical grouping are known as A) elements.
B) records.
C) data items.
D) attributes.
Q5) A database has a hierarchical data structure.This is an example of defining database architecture at the A) physical level.
B) conceptual level.
C) sequential level.
D) logical level.
Q6) Database ________ permits upgrading or modifying the eBusiness application without changing data or database software.
Q7) Discuss the conceptual level of architecture relevant to databases and their management.
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Chapter 14: Auditing Information Technology
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124 Verified Questions
124 Flashcards
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Sample Questions
Q1) Information technology is used to perform some audit work that otherwise would be done manually.The use of information technology by auditors is
A) essential.
B) mandatory under AICPA Statements of Auditing Standards.
C) optional.
D) at the sole discretion of the manager in charge of the audit.
Q2) Documentation governing the design,development,and implementation of application systems is known as systems ________ ________.
Q3) Why are most audits now performed by auditing through and with the computer?
Q4) Which of the following procedures uses only auditor-prepared test transactions?
A) The test data approach
B) Integrated test facility
C) Parallel simulation
D) Embedded audit routines
Q5) IT governance has the objective of enhancing and ensuring the efficient application of IT resources as a critical success factor.
A)True
B)False
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