question

A prescribed sequence of work steps performed in order to produce a desired result for the organization is called a(n):

answer

Business Process

question

The process that must identify the transactions to be recorded, capture all the important details of the transactions, properly process the transaction details, and provide reports is termed the:

answer

Accounting Information System

question

The proper order of activity in an accounting information system would be as follows:

answer

Capture, Record, Process, Report

question

Work steps that are internal controls within the business process would include:

answer

Reconciling a cash register at the end of each day.

question

The entities, processes, and information flows that involve the movement of materials, funds, and related information through the full logistics process, from the acquisition of raw materials to the delivery of the finished products to the end user is a set of linked activities referred to as:

answer

Supply Chain

question

The organization and control of all materials, funds, and related information in the logistics process, from the acquisition of raw materials to the delivery of finished products to the end user is referred to as:

answer

Supply Chain Management

question

When discussing the supply chain:

answer

An entity may not be able to directly control all interrelated activities within the supply chain.

question

Using IT systems to enhance efficiency and effectiveness of internal or supply chain processes is called:

answer

Information Technology Enablement

question

The purposeful and organized changing of business processes to make them more efficient is referred to as:

answer

Business Process Reengineering

question

The use of BPR (Business Process Reengineering) is two fold: (1) Aligns business processes with the IT systems used to record processes and, (2):

answer

Improves the efficiency and effectiveness of these processes.

question

The smallest unit of information in a computer system can have only two values, zero or one, and is referred to as a(n):

answer

Bit

question

A unit of storage that represents one character is referred to as a:

answer

Byte

question

A set of related fields is referred to as a:

answer

Record

question

A collection of data stored on a computer in a form that allows the data to be easily accessed, retrieved, manipulated, and stored is referred to as a(n):

answer

Database

question

Accounting software traditionally uses two different types of files. The file type that is relatively permanent and used to maintain the detailed data for each major process is a(n):

answer

Master File

question

Accounting software traditionally uses two different types of files. The file type that is the set of relatively temporary records that will be processed to update the permanent file is referred to as a(n):

answer

Transaction File

question

Two or more computers linked together to share information and/or resources is referred to as a(n):

answer

Computer Network

question

This type of computer network is one that spans a relatively small area - often confined to a single building or group of buildings, and are intended to connect computers within an organization.

answer

Local Area Network (LAN)

question

The global computer network, or "information super highway," is the:

answer

Internet

question

A company's private network, accessible only to the employees of that company is the:

answer

Intranet

question

A contemporary type of computer infrastructure that is used by an increasing number of companies involves the use of shared services, software, and/or data stored on servers in a remote location, which are accessible over a network, is referred to as:

answer

Cloud Computing

question

The intercompany, computer-to-computer transfer of business documents in a standard business format is called:

answer

Electronic Data Interchange

question

This term refers to a system of hardware and software that captures retail sales transactions by standard bar coding.

answer

Point of Sale System

question

A system of computer hardware and software in which the software matches an invoice to its related purchase order and receiving report is called:

answer

Automated Matching

question

An invoice-less system in which computer hardware and software complete an invoice-less match that is a comparison of the purchase order with the goods received is termed:

answer

Evaluated Receipt System

question

A multi-module software system designed to manage all aspects of an enterprise usually broken down into modules such as financials, sales, human resources, and manufacturing is referred to as a(n):

answer

Enterprise Resource Planning

question

Management has the responsibility, and the ability, to take action to reduce risks or to lessen the impact at nearly all risks an organization faces. The steps taken by management to lessen the risk or reduce the impact of the risk, are referred to as:

answer

Controls

question

Which of the following groups of professionals within an organization have a history of designing and implementing the controls to lessen risks?

answer

Accountants

question

A comprehensive report on enterprise risk management was issued by this organization.

answer

Committee on Sponsoring Organizations

question

A process, enacted by an entity's board of directors, management and other personnel, applied in strategy setting and across the enterprise, designed to identify potential events that may affect the entity, and manage risk to be within its risk appetite, to provide reasonable assurance regarding the achievement of entity objectives is referred to as:

answer

Entity Risk Management

question

In order to achieve the objective of managing risk, management should establish control structures that include, at a minimum:

answer

IT Controls, IT Governance, Corporate Governance, and Accounting Internal Controls

question

The company's development and adherence to this should reduce the opportunities for management or employees to conduct fraud.

answer

Code of Ethics

question

The COSO report, Internal Controls - Integrated Framework, identified interrelated components of internal control. Which of the following is NOT one of those components?

answer

Enterprise Risk Management

question

The purpose of this 2002 act was to improve financial reporting and reinforce the importance of corporate ethics.

answer

Sarbanes-Oxley Act

question

Which of the following is not one of the corporate functions interrelated within the corporate governance system?

answer

Risk Assessment

question

The proper management, control, and use of IT systems are known as:

answer

IT Governance

question

When a company receives returned goods from a customer, the business process to accept the return would most likely be a(n):

answer

Revenue Process

question

Which of the following is least likely to be an output of the accounting information system:

answer

A Bar Code

question

Which of the following is not true of the supply chain?

answer

The supply chain excludes customers

question

Which of the following is not an objective of IT enablement?

answer

Reduced security problems

question

The correct order of the computer data hierarchy is:

answer

Bit, byte, field, record, file, database

question

The process of searching for identifiable patterns in data is called:

answer

Data mining

question

An IT enabled system for purchasing that is an "invoice-less" system is called a(n):

answer

Evaluated Receipt System

question

The COSO report written for the purpose of assisting managers in the challenge of managing risk in their organization is entitled:

answer

"Enterprise Risk Management-Integrated Framework"

question

Accountants have some form of use of the AIS in all but which role?

answer

Programmer

question

Which of the following is not true of unethical behavior?

answer

The only category of unethical behavior for accountants is inflating revenue

question

A prescribed sequence of work steps completed in order to produce a desired result for an organization is the definition of:

answer

Business Process

question

Which of the following correctly states the order of steps in a manual accounting system?

answer

Source documents, journals, ledgers, reports

question

The choice of accounting information systems will depend on all of the following except:

answer

The ability of the company to capture information

question

In order to organize the study of accounting information systems, the authors divided the systems in place into three categories. Which of the following is NOT one of those categories?

answer

Client-Server Systems

question

A source document serves important functions in the accounting system. Which of the following is not one of those functions?

answer

Provides the output data for financial reports

question

An output of the accounting system that can be used as an input in a different part of the accounting system is referred to as:

answer

Turnaround Document

question

Many of the accounting software systems consist of modules. Which of the following statements is false related to these modules?

answer

Are referred to as special purpose systems

question

An existing system within the organization that uses older technology is called a(n):

answer

Legacy System

question

A set of processes, software and hardware tools, methodologies, and technologies to integrate software systems is referred to as:

answer

Enterprise-application integration

question

A use of enterprise application integration would include:

answer

All listed items would be included: Bridge the legacy systems to the new hardware and software; intended to consolidate, connect, and organize all of the computer applications, data, and business processes; allow real-time exchange and management of all the critical information

question

Which of the following statements is false?

answer

New programs sold by software development companies are not as user friendly as the legacy systems

question

This type of computing means that there are two types of computers networked together to accomplish the application processing:

answer

Client-server computing

question

Which of the following is not a main component of client-server system?

answer

The client does not participate in the processing or data manipulation

question

Which of the following is not an example of cloud computing?

answer

Purchasing songs from iTunes and downloading those songs onto your computer

question

Which of the following is not an advantage to a cloud model of e-mail?

answer

Costs associated with maintaining are higher but are more controllable.

question

There are a number of advantages to cloud computing. Which of the following is one of those advantages?

answer

All of the above: As a company grows, it can easily purchase new capacity from the cloud provider; once the software and data are stored in the cloud, it can be accessed by multiple devices from multiple locations; the company has reduced need for servers and data storage

question

There were four market segments identified by the authors in Chapter 2. Which of the following is not one of those segments?

answer

Legacy Company Systems

question

A printed code consisting of a series of vertical, machine readable, rectangular bars and spaces, that vary in width and are arranged in specific ways to represent letters and numbers are referred to as:

answer

Bar Coding

question

A method of using hardware and software that captures retail sales transactions by standard bar coding is referred to as:

answer

Point of Sale System

question

The major difference between EDI and e-business is:

answer

EDI uses dedicated networks and e-business uses the internet

question

After the accounting information has been input into the accounting system, it must be processed. Process accounting data involves:

answer

Calculations, classification, and summarization

question

When all similar transactions are grouped together for a specified time and then processed together as a group, the process is referred to as:

answer

Batch Processing

question

The processing system where transactions are processed immediately and where output is available immediately is referred to as:

answer

Real-time Processing

question

The advantages to real-time processing include:

answer

All of the above: as data is entered, the system checks for input errors - therefore, errors can be corrected immediately; information is provided to users on a timely basis; all files are constantly up to date

question

The disadvantages to real-time processing include:

answer

The single database that is shared is more susceptible to unauthorized access

question

Documentation of the accounting system allows:

answer

The accountant to analyze and understand the procedures and business process and the systems that capture and record the accounting data

question

A pictoral representation of business processes in which the actual flow and sequence of events in the process are presented in the diagram form - the start of the process, the steps within the process, and the finish of the process is referred to as:

answer

Process Map

question

This method of system documentation is intended to show the entire system, including inputs manual and computerized processes, and outputs.

answer

System Flowcharting

question

Which of the following statements is not true regarding business processes?

answer

Business processes categorized as expenditure processes are intended to be processes that serve customers

question

In a manual system, an adjusting entry would most likely be initially recorded in a:

answer

General journal

question

Which of the following is not a disadvantage of maintaining legacy systems?

answer

They contain invaluable historical data that may be difficult to integrate into newer systems

question

Which of the following is a disadvantage of purchased accounting software, compared with software developed in-house?

answer

It is custom-designed for that company

question

Which of the following is not a method of updating legacy systems?

answer

Backoffice ware

question

When categorizing the accounting software market, a company with revenue of $8 million would most likely purchase software from which segment?

answer

Midmarket

question

An IT system that uses touch-screen cash registers as an input method is called:

answer

Point of Sale System

question

When similar transactions are grouped together for a specific time for processing, it is called:

answer

Batch Processing

question

Which of the following is not correct regarding the ways that real-time systems differ from batch systems?

answer

Processing cho9ices are menu-driven

question

In documenting systems, which pictorial method is described as a method that diagrams the actual flow and sequence of events?

answer

Process Map

question

Each of the following companies was involved in fraudulent financial reporting during 2001 and 2002, except:

answer

Microsoft Corporation

question

In addition to ethical practices, management has an obligation to maintain a set of processes and procedures to assure accurate financial reporting and protection of company assets. This obligation arises because:

answer

All of the above: Many groups have expectations of management; management has a stewardship obligation to its investors; management has an obligation to provide accurate reports to non-investors

question

The careful and responsible oversight and use of the assets entrusted to management is referred to as:

answer

Stewardship

question

If an organization's IT systems are not properly controlled, they may become exposed to the risks of:

answer

All of the above: unauthorized access; erroneous processing; service interruption

question

Which individual or group has the responsibility to establish, enforce, and exemplify the principles of ethical conduct within an organization?

answer

Management

question

The theft, concealment, and conversion of personal gain of another's money, physical assets, or information is termed:

answer

Fraud

question

The theft of any item of value is referred to as:

answer

Misappropriation of Assets

question

Financial pressures, market pressures, job-related failures, and addictive behaviors are all examples of which condition of the Fraud Triangle?

answer

Incentive

question

Circumstances that provide access to the assets or records that are the objects of the fraudulent activity describes which condition of the Fraud Triangle?

answer

Opportunity

question

Fraudsters typically try to justify their behavior by telling themselves that they intend to repay the amount stolen or that they believe the organization owes them the amount stolen. This justification is referred to as:

answer

Rationalization

question

Which of the following is the most common method of detecting occupational fraud?

answer

Tip from an employee, customer, or vendor

question

The falsification of accounting reports is referred to as:

answer

Earnings Management

question

Management circumvention of systems or internal controls that are in place is termed:

answer

Management Override

question

When two or more people work together to commit a fraud, it is called:

answer

Collusion

question

Jamie Stark, a sales employee, stole merchandise from her employer, and Frank Adams, the accounting clerk, covered it up by altering the inventory records. This is an example of:

answer

Collusion

question

The theft of proprietary company information is called:

answer

Espionage

question

This type of external computer fraud is intended to overwhelm an intended target computer system with so much bogus network traffic so that the system is unable to respond to valid traffic:

answer

DoS Attack

question

The Sarbanes-Oxley act was passed in 2002 as Congress's response to the many situations of fraudulent financial reporting discovered during 2001. The intention of the Act was:

answer

Reform accounting, financial reporting, and auditing functions of companies that are publicly traded

question

The COSO report is also known as:

answer

Internal Control Integrated Framework

question

One of the components of internal control identified by COSO required that management must be considering threats and the potential for risks, and stand ready to respond should these events occur. This component is referred to as:

answer

Risk Assessment

question

The process of risk assessment would include all of the following actions, except:

answer

Report the risks to the audit committee

question

The COSO report identified a component of internal control as the policies and procedures that help ensure that management directives are carried out and that management directives are achieved. The component is:

answer

Control Activities

question

If an accounting supervisor were allowed to hire employees, approve the hours worked, prepare the paychecks, and deliver the paychecks, which of the categories of control activities would be violated?

answer

Segregation of Duties

question

This activity serves as a method to confirm the accuracy and completeness of data in the accounting system:

answer

Independent Checks

question

Which of the following was NOT listed as a procedure to accomplish independent checks?

answer

Review of Auditing Procedures

question

The ongoing review and evaluation of a system of internal control is referred to as:

answer

Monitoring

question

This level of assurance means that controls achieve a sensible balance of reducing risk when compared with the cost of control:

answer

Reasonable Assurance

question

In order to have the segregation of duties by COSO, it would be necessary for a small organization to hire two additional individuals. At this time, there is not enough work for the one office employee to stay busy. The reason for not hiring the additional people would have to do with:

answer

Cost versus Benefit

question

The Trust Services Principles document divided the risks and controls in IT into five categories. Which of the following is NOT one of those categories?

answer

Certification

question

The main risk related to this category of Trust Services Principles is unauthorized access:

answer

Security

question

The risk related to this category of Trust Services Principles could be inaccurate, incomplete, or improperly authorized information:

answer

Process Integrity

question

The risk related to this category of Trust Services Principles is that personal information about customers may be used inappropriately or accessed by those either inside or outside the company:

answer

Online Privacy

question

The careful and responsible oversight and use of the assets entrusted to management is called:

answer

Stewardship

question

Which of the following is NOT a condition of the Fraud Triangle?

answer

Conversion

question

There are many possible indirect benefits to management when management fraud occurs. Which of the following is NOT an indirect benefit of management fraud?

answer

Delayed exercise of stock options

question

Which of the following is NOT an example of employee fraud?

answer

Earnings Management

question

Which of the following is NOT a common form of employee fraud?

answer

Refund Fraud

question

Segregation of duties is a fundamental concept in an effective system of internal controls. Nevertheless, the effectiveness of this control can be compromised through which situation?

answer

Collusion among employees

question

The most difficult type of misstatement to discover is fraud that is concealed by:

answer

Nonrecorded Transactions

question

The review of amounts charged to the company from a seller that it purchased from is called a:

answer

Vendor Audit

question

Which of the following is generally an external computer fraud, rather than an internal computer fraud?

answer

Spoofing

question

Which control activity is intended to serve as a method to confirm the accuracy or completeness of data in the accounting system?

answer

Independent Checks and Reconciliations

question

COSO describes five components of internal control. Which of the following terms is best described as "policies and procedures that help ensure management directives are carried out and management objectives are achieved?"

answer

Control Activities

question

Proper segregation of duties calls for separation of the functions of:

answer

Authorization, Recording, and Custody

question

The AICPA Trust Services Principles identify five categories of risks and controls. Which category is best described by the statement, "Information processes could be inaccurate, incomplete, or not properly authorized?"

answer

Processing Integrity

question

A company's cash custody function should be separated from the related cash record-keeping function in order to:

answer

Minimize opportunities for misappropriations of cash

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