Question 1

______________________________ is the possibility that an event will occur.

Accepted Answer

The answer of ______________________________ is the possibility that an event...

Question 2

______________________________ is a process,effected by an entity's board of directors,management and other personnel,applied in strategy settings 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.

Accepted Answer

The answer of ______________________________ is a process,effected by an entity's...

Question 3

_____________ control plans relate to a multitude of goals and processes.
A) Pervasive
B) IT general
C) Business process
D) Preventive

Accepted Answer

Pervasive control plans are designed to apply across an organization's operations and relate to a multitude of goals and processes. This includes controls related to financial reporting, IT security, human resources, and more. The other options are more specific types of control plans. IT general controls relate specifically to IT systems, business process controls relate specifically to business processes, and preventive controls relate specifically to minimizing risk and preventing errors or fraud.

Question 4

Discrepancies between data items recorded by a system and the underlying economic events or objects they represent are a violation of the control goal of:
A) ensure input validity
B) ensure input completeness
C) ensure input accuracy
D) ensure update completeness

Accepted Answer

The control goal of ensuring input accuracy is directly concerned with ensuring that the data accurately represents the underlying economic events or objects. Discrepancies between recorded data and actual events or objects would therefore be a violation of this control goal. Choices A, B, and D are also important control goals, but do not specifically address this issue.

Question 5

The business process objectives that an internal control system is designed to achieve are:
A) control goals
B) control plans
C) general controls
D) the control matrix

Accepted Answer

Internal control systems are designed to achieve control goals, which are specific objectives that aim to ensure the accuracy, completeness, reliability, and timeliness of financial and operational information, as well as the effectiveness and efficiency of business processes. Control plans are specific procedures and activities that are implemented to achieve these control goals, while general controls are the basic infrastructure, policies, and procedures that support the effective operation of the internal control system. The control matrix is a tool that helps to document and evaluate the design and effectiveness of internal controls.

Question 6

A process captures only authorized transactions but fails to record them only once.Which control goal does this fail to achieve?
A) validity
B) accuracy
C) completeness
D) effectiveness

Accepted Answer

The control goal that this process fails to achieve is completeness. Completeness means that all authorized transactions are recorded. If a transaction is captured but not recorded, it is not complete and the completeness control goal is not achieved.

Question 7

Automated business process controls contained within IT systems are called:
A) preventive controls
B) pervasive controls
C) application controls
D) management controls

Accepted Answer

Application controls are automated business process controls contained within IT systems. These controls are designed to ensure the accuracy, completeness, and validity of transactions and data processed by application systems. Preventive controls are designed to prevent errors or irregularities from occurring, while pervasive controls are broad controls that affect the entire organization. Management controls are controls implemented by management to ensure that business objectives are being achieved.

Question 8

A control that involves reprocessing transactions that are rejected during initial processing is an example of:
A) preventive controls
B) detective controls
C) corrective controls
D) programmed controls

Accepted Answer

Reprocessing rejected transactions is a corrective control because it addresses errors that have already occurred and aims to correct them. Preventive controls aim to prevent errors from occurring in the first place, while detective controls aim to detect errors that may have occurred. Programmed controls refer to automated controls built into the system.

Question 9

Control goals of operations processes include:
A) validity
B) the control environment
C) accuracy
D) security of resources

Accepted Answer

The answer of Control goals of operations processes include:
A) validity
B)...

Question 10

Assuring that the accounts receivable master data reflects all cash collections recorded in the cash receipts event data addresses the control goal of:
A) ensure input accuracy
B) ensure input completeness
C) ensure update accuracy
D) ensure update completeness

Accepted Answer

Ensuring that the accounts receivable master data reflects all cash collections recorded in the cash receipts event data pertains to updating completeness, which is the control goal of ensuring that all changes to master data are properly recorded and reflected.

Question 11

Controls that stop problems from occurring are called:
A) preventive controls
B) detective controls
C) corrective controls
D) programmed controls

Accepted Answer

Preventive controls are designed to stop problems from occurring in the first place.

Question 12

The third level of protection in the control hierarchy is:
A) the control environment
B) business process control plans
C) pervasive control plans
D) IT general controls

Accepted Answer

The third level of protection in the control hierarchy is business process control plans, which are designed to address specific risks within a particular business process. These controls operate at an application level and provide a more granular level of control than the control environment or IT general controls. Pervasive control plans are part of the second level of protection in the control hierarchy, along with the control environment and IT general controls.

Question 13

Which of the following is a control goal regarding master data?
A) ensure input validity
B) ensure update accuracy
C) ensure input accuracy
D) ensure input completeness

Accepted Answer

While all of these goals are important for ensuring the quality of master data, the specific control goal regarding master data is typically to ensure update accuracy. This involves creating processes and controls to ensure that changes to master data are made accurately and completely, without introducing errors or inconsistencies into the data.

Question 14

______________________________ is a process by which organizations select objectives,establish processes to achieve objectives,and monitor performance.

Accepted Answer

The answer of ______________________________ is a process by which organizations...

Question 15

____ relate to a specific AIS process,such as billing or cash receipts.
A) Control procedures
B) Information processing procedures
C) Business process control plans
D) Operations system control plans

Accepted Answer

Business process control plans relate specifically to controlling and monitoring specific AIS processes, such as billing or cash receipts. These plans are designed to ensure that transactions are processed accurately, completely, and in a timely manner. Control procedures are more general in nature and can apply to multiple processes, while information processing procedures and operations system control plans are not as specific to AIS processes.

Question 16

A programming error causes the sale of an inventory item to be added to the quantity on hand attribute in the inventory master data.Which control goal was not achieved?
A) ensure update completeness
B) ensure input accuracy
C) ensure update accuracy
D) ensure input completeness

Accepted Answer

The control goal of ensuring update accuracy was not achieved because the programming error caused an incorrect update to the quantity on hand attribute in the inventory master data.

Question 17

Assuring that cash collections recorded in the cash receipts event data are credited to the right customer in the accounts receivable master data addresses the control goal of:
A) ensure input accuracy
B) ensure input completeness
C) ensure update accuracy
D) ensure update completeness

Accepted Answer

Ensuring that cash collections recorded in the cash receipts event data are credited to the right customer in the accounts receivable master data is an example of the control goal of ensuring update accuracy. This control ensures that the accuracy of the customer's account balance is maintained and that the cash receipt is properly recorded in the system.

Question 18

Why is there usually no control goal called update validity?
A) Input and update completeness achieve update validity.
B) Input validity guarantees update validity.
C) Update accuracy guarantees update validity.
D) Input accuracy achieves update validity.

Accepted Answer

Update validity refers to the accuracy of updates made to a system. Input validity refers to the accuracy of the data entered into the system. By ensuring that input and update completeness are achieved, it can be assumed that the updated data is also accurate and valid. Therefore, there is usually no need for a separate control goal for update validity.

Question 19

A tool designed to assist you in evaluating the potential effectiveness of controls in a business process by matching control goals with relevant control plans is:
A) ERM
B) control plans
C) control matrix
D) internal controls

Accepted Answer

The tool described in the question is a control matrix, which is a table or chart that matches control goals with relevant control plans. ERM (Enterprise Risk Management) is a broader concept that encompasses risk management strategies throughout an organization, while control plans and internal controls are components of a control matrix. Therefore, the best choice is C.

Question 20

Strong antifraud controls include:
A) segregation of duties
B) job rotations
C) mandatory vacations
D) all of the above

Accepted Answer

All of the above choices are important components of strong antifraud controls. Segregation of duties helps ensure that no one person has complete control over a process or transaction, thereby reducing the risk of fraud. Job rotations can help prevent fraud by exposing employees to different roles and functions within the organization, making it more difficult for an individual to engage in fraudulent activities without being detected. Mandatory vacations can also help prevent fraud by ensuring that an employee's work is reviewed and scrutinized by someone else in their absence. By combining these controls, organizations can create a robust antifraud program that helps reduce the risk of fraud and protect against financial losses.

Quiz 7: Controlling Information Systems: Introduction to Enterprise Risk Management and Internal Control

______________________________ is the possibility that an event will occur.

_____________ control plans relate to a multitude of goals and processes.

Discrepancies between data items recorded by a system and the underlying economic events or objects they represent are a violation of the control goal of:

The business process objectives that an internal control system is designed to achieve are:

A process captures only authorized transactions but fails to record them only once.Which control goal does this fail to achieve?

Automated business process controls contained within IT systems are called:

A control that involves reprocessing transactions that are rejected during initial processing is an example of:

Control goals of operations processes include:

Assuring that the accounts receivable master data reflects all cash collections recorded in the cash receipts event data addresses the control goal of:

Controls that stop problems from occurring are called:

The third level of protection in the control hierarchy is:

Which of the following is a control goal regarding master data?

______________________________ is a process by which organizations select objectives,establish processes to achieve objectives,and monitor performance.

____ relate to a specific AIS process,such as billing or cash receipts.

A programming error causes the sale of an inventory item to be added to the quantity on hand attribute in the inventory master data.Which control goal was not achieved?

Assuring that cash collections recorded in the cash receipts event data are credited to the right customer in the accounts receivable master data addresses the control goal of:

Why is there usually no control goal called update validity?

A tool designed to assist you in evaluating the potential effectiveness of controls in a business process by matching control goals with relevant control plans is:

Strong antifraud controls include: