Question 1

Many companies use a public cloud computing model for software, data storage or both.Which of the following is an advantage to the public cloud computing model?

Accepted Answer

Public cloud computing offers expanded access to resources, cost savings due to shared infrastructure, and scalability that allows for easy expansion or reduction of resources as needed. Therefore, all of the above are advantages of the public cloud computing model.

Question 2

Internal controls over the input, processing, and output of accounting applications are called:

Accepted Answer

Internal controls over the input, processing, and output of accounting applications are called application controls.

Question 3

A company using public cloud computing has the ability to purchase new capacity from the cloud provider, instead of buyer servers or new data storage.This ability is referred to as:

Accepted Answer

Scalability refers to the ability for a company to easily increase or decrease the amount of resources they are using in the public cloud, such as purchasing new capacity from the cloud provider instead of buying new servers or data storage.

Question 4

Which of the following is NOT one of the types of input controls?

Accepted Answer

The three types of input controls are source document controls, programmed edit checks, and control totals and reconciliation. Confidentiality check is not a type of input control.

Question 5

The software that accomplishes end user tasks such as work processing, spreadsheets, and accounting functions is called:

Accepted Answer

Application software is designed to accomplish specific tasks that directly benefit the end user, such as word processing, spreadsheet applications, accounting software, and more. Operating software manages the computer's hardware and software resources and provides common services for the computer programs. Database software enables users to store, organize, retrieve, and manipulate data in a database. Management software helps users to manage and control various aspects of their business, such as project management, resource allocation, and more.

Question 6

The process where the details of individual transactions at each stage of the business process can be recreated in order to establish whether proper accounting procedures for the transaction were performed is called:

Accepted Answer

The process described is that of creating an audit trail, which is a record of individual transactions that can be traced back through the entire business process. This helps to ensure that proper accounting procedures are being followed at each stage. The other choices do not accurately describe this process.

Question 7

The data preparation procedures are to be well-defined so that employees will be sure of:

Accepted Answer

To ensure proper data preparation, employees must know which forms to use, when to use them, and where to route them. Therefore, all three choices (A, B, and C) are necessary for well-defined procedures, making D the correct answer.

Question 8

The procedures to collect and prepare source documents are termed:

Accepted Answer

The procedures to collect and prepare source documents are primarily concerned with data preparation procedures, as they involve collecting and organizing the necessary data before input validation, form authorization, or document retention can occur.

Question 9

To avoid the risks associated with a public cloud, many companies establish their own computing cloud structure.The cloud is developed, owned, maintained, and used by the user company.This cloud is referred to as:

Accepted Answer

A private cloud is a cloud infrastructure that is solely owned and operated by a single organization. It offers the same benefits as a public cloud, such as scalability, flexibility, and on-demand resource allocation, but it is not shared with other companies, which minimizes security risks. A private cloud is often used by companies that handle sensitive data or have specific regulatory requirements.

Question 10

Field check, limit check, range check and sequence check are all examples of:

Accepted Answer

Field check, limit check, range check and sequence check are all examples of input validation checks. These checks help ensure that data entered into a system is accurate, complete, and within the expected parameters. By performing these checks, errors can be detected and corrected before they have a chance to cause problems in the system, such as incorrect calculations or database corruption.

Question 11

This type of control is intended to help ensure the accuracy, completeness, and security of outputs that result from application processing:

Accepted Answer

Output Controls are designed to ensure that the output of a system is accurate, complete, and secure. These controls are put in place to verify that output is produced in accordance with established requirements and that any errors are identified and corrected before the final output is produced. Examples of output controls include error detection and correction procedures, logging and tracking of output, and the use of encryption to protect sensitive information.

Question 12

Which of the following items is not one of the source document controls?

Accepted Answer

The validity check is not one of the source document controls. The other options, form design, form authorization and control, and retention of source documents are all important controls for ensuring the accuracy and completeness of source documents. Validity checks are typically performed on data that has already been input into a system to detect any errors or inconsistencies.

Question 13

Companies who provide mobile devices for employees, normally have a policy that allows the company's IT professional to remove company data and applications from the mobile device.This process is referred to as:

Accepted Answer

The process of removing company data and applications from a mobile device is commonly known as remote wipe. This is a security measure that is implemented to ensure that sensitive company information is not compromised in the event that an employee loses their device or leaves the company. Remote wipe allows the company IT professional to erase all of the data and applications on the device remotely, without the need for physical access to the device.

Question 14

The paper form used to capture and record the original data of an accounting transaction is called a(n):

Accepted Answer

A source document is the original record of a transaction that provides proof of the transaction and is used to create the journal entry for recording it in the accounting system. The other options are not specifically related to the original source of the transaction data.

Question 15

The company-to-company transfer of standard business documents in electronic form is called:

Accepted Answer

The standard business document transfer in electronic form is called Electronic Data Interchange (EDI). Facsimile Transmission (A) is the transfer of physical or digitized copies of documents through fax machines or digital fax transmissions. PDF Interchange (B) is the transfer of documents in PDF format, which is commonly used for viewing and sharing documents, but not necessarily for standardized business transactions. Tele-transmission (D) is not a commonly used term in the context of business document transfer.

Question 16

Risks associated with public cloud computing include all of the following, except:

Accepted Answer

Scalability is actually a benefit of public cloud computing, not a risk. It allows organizations to easily scale up or down their resources as needed without investing in additional infrastructure. Therefore, the correct answer is D.

Question 17

This type of control is intended to ensure the accuracy and completeness of data input procedures and the resulting data:

Accepted Answer

Input controls are specifically designed to ensure that the data entered into a system is accurate and complete. This includes things like data validation checks, data verification processes, and automated error correction mechanisms. By implementing input controls, organizations can reduce the risk of data entry errors, enhance the integrity of their data, and improve the overall effectiveness of their information systems.

Question 18

The process of converting data from human readable form to computer readable form is referred to as:

Accepted Answer

Data input is the process of converting data from human-readable form to a form that can be processed by a computer.

Question 19

This type of input validation check examines a field to ensure that the data entry in the field is valid compared with a preexisting list of acceptable values.

Accepted Answer

This type of input validation check is called a validity check, as it validates that the data entered in the field is valid according to a preexisting list of acceptable values. Field check examines whether the data entered in the field is of the correct type, completeness check ensures that all necessary data is present, and range check validates that the data entered in the field is within a defined range of values.

Question 20

This type of control is intended to ensure the accuracy and completeness of processing that occurs in accounting applications:

Accepted Answer

Processing controls are designed to ensure that the processing of data in accounting applications is accurate and complete. This type of control may include things like data validation, error checking, and process monitoring to ensure that data is handled correctly throughout the system. Examples could include reconciliation processes, quality assurance checks, or auditing procedures that assess the accuracy and completeness of data processing in accounting applications.

Quiz 4: Internal Controls and Risks in IT Systems