Question 1

Protecting the IT resources,ensuring the reliable and continuous operations and developing a disaster recovery plan are all aspects of:

Accepted Answer

IT governance is the framework of policies and procedures that ensure the effective and efficient use of IT resources. It includes the protection of IT resources, ensuring the reliable and continuous operations of IT systems, and developing a disaster recovery plan.

Question 2

Which of the following principle is not part of the principles for corporate governance identified by the ASX Corporate Governance Council?

Accepted Answer

Keeping disclosure of business information to a minimum is not a part of the principles for corporate governance identified by the ASX Corporate Governance Council. In fact, transparency and disclosure of relevant business information is an important principle of corporate governance.

Question 3

Organisational decisions about IT infrastructure does NOT necessarily include:

Accepted Answer

Decisions about IT infrastructure typically involve considerations about the type of processing required, where the processing will take place, and how different systems and processes will be integrated. The upgradability of the processing, while important, is more related to the specifics of the hardware and software choices rather than the broader strategic decisions about the overall IT infrastructure.

Question 4

In Australia,it is recommended that the board is made up of:

Accepted Answer

It is recommended that the board of directors in Australia should consist of a mixture of executive and independent directors. This ensures that the board has both inside knowledge of the company and perspectives from outside the company, promoting good governance and decision making. Full-time employees may not possess the necessary independence to make objective decisions, while external directors who are not involved in the business may not have enough insight on company operations. Accountants, auditors, and executive directors may have conflicts of interest that may affect their objectivity.

Question 5

In terms of IT governance,which of the following is NOT one of the five specific areas that need to be considered by those with the responsibility of managing IT?

Accepted Answer

The five specific areas that need to be considered by those with the responsibility of managing IT are matching IT to strategy, adding value, managing resources, managing risk, and measuring performance. Therefore, reducing costs is not one of these specific areas.

Question 6

What part of an organisation determines the corporate governance?

Accepted Answer

The board of directors is responsible for determining the corporate governance of an organization. They are elected by shareholders to oversee the management and direction of the company, including setting policies and procedures that guide decision-making and accountability. While shareholders do have a role in selecting board members, they do not typically dictate corporate governance. Employees and the government may have an impact on corporate governance through their actions and regulations, but it is ultimately the responsibility of the board.

Question 7

Which of the following is related to corporate governance? (i)Goal setting (ii)Risk management (iii)Performance measurement and management

Accepted Answer

All of the options (i)(ii)(iii) are related to corporate governance. Goal setting is important to align the strategy with the objectives of the organization. Risk management ensures that the risks are identified and appropriately managed or mitigated. Performance measurement and management tracks the progress, ensures accountability, and helps in continuous improvement of the organization. These are all key components of effective corporate governance.

Question 8

In the Australian Securities Exchange's definition of corporate governance,risks should be:

Accepted Answer

Risks should be monitored and assessed to ensure that they are properly managed and do not pose a threat to the company.

Question 9

The OECD's definition of corporate governance has specifically outlined the relationships between:

Accepted Answer

The correct definition of corporate governance according to the OECD includes the relationships between a company's management, its board, its shareholders, and other stakeholders. This definition acknowledges that corporate governance extends beyond the internal operations of a company and includes the interests of external stakeholders as well.

Question 10

To promote ethical and responsible decision making,an organisation should: (i)have clearly specified codes of conduct for employees and management (ii)have standards for dealing with various organisational stakeholders (iii)have procedures to be followed when investigating potential unethical activities within the organisation (iv)take legal actions immediately against unethical conducts.

Accepted Answer

Promoting ethical and responsible decision-making involves having clear codes of conduct (i), standards for dealing with stakeholders (ii), and procedures for investigating unethical activities (iii). Immediate legal action (iv) may not always promote ethical decision-making, as it could bypass internal resolution processes.

Question 11

What is the connection between the concept of accountability and corporate governance?

Accepted Answer

Accountability refers to the responsibility of an individual or entity to report and take ownership of its actions or decisions. Corporate governance, on the other hand, refers to the system of rules, practices, and processes by which a company is directed and controlled. In corporate governance, accountability is a key principle that ensures that those in charge are held responsible for their actions and decisions. The board of directors is ultimately accountable for the company's performance and is responsible for ensuring that the company is being run in the best interests of its shareholders. However, the board delegates decision making to employees but retains ultimate responsibility. Therefore, choice B is the best connection between the concept of accountability and corporate governance.

Question 12

The aspect referring to how IT is going to be used in the organisation and will be a general statement or specification about how IT will be positioned and the role it will play in the organisation as it embarks on meeting customer needs is:

Accepted Answer

IT principles are a set of general statements or specifications about how IT will be used in an organization and the role it will play in meeting customer needs. IT governance refers to the overall management framework for IT, while IT objectives are specific goals related to the use of IT within an organization. IT control refers to the processes and procedures used to ensure that IT resources are used effectively and efficiently.

Question 13

The current eight principles for corporate governance outlined by the ASX Corporate Governance Council do not include:

Accepted Answer

The correct principle related to risk as outlined by the ASX Corporate Governance Council is "Manage risk," not "Recognise and minimise risk."

Question 14

Which of the following is the objective(s)of a corporate governance system? (i)To ensure that minority shareholders receive reliable information about the value of firms and that a company's managers and large shareholders do not cheat them out of the value of their investments.(ii)To motivate managers to maximise firm value instead of pursuing personal objectives.(iii)To encourage companies to create value,through entrepreneurialism,innovation,development and exploration,and provide accountability and control systems commensurate with the risks involved.

Accepted Answer

The objective(s) of a corporate governance system are (i) to ensure that minority shareholders receive reliable information about the value of firms and that a company's managers and large shareholders do not cheat them out of the value of their investments, (ii) to motivate managers to maximize firm value instead of pursuing personal objectives, and (iii) to encourage companies to create value through entrepreneurialism, innovation, development, and exploration and provide accountability and control systems commensurate with the risks involved. Therefore, option D (i)(ii)(iii) is the best choice.

Question 15

Corporate governance is about: (i)the many relationships in which an organisation is involved and how these relationships are managed (ii)putting in place policies that allow for the various relationships of the organisation to be successfully managed (iii)putting in place structures that allow for the various relationships of the organisation to be successfully managed.

Accepted Answer

Corporate governance encompasses the relationships an organization has and how these are managed, as well as the policies and structures put in place to ensure these relationships are managed successfully.

Question 16

What could be the result of poor corporate governance in an organisation?

Accepted Answer

Poor corporate governance can lead to mismanagement of resources and financial misconduct, ultimately resulting in company failure. This can have a ripple effect on the economy, as seen in the case of Enron and Lehman Brothers.

Answer: A and D 
 Poor corporate governance can result in managers prioritizing their own self-interests over the well-being of the company, leading to poor decision-making and ultimately lower returns on investment for minority shareholders. This can also result in unethical practices and behavior that can harm the reputation of the company.

Question 17

In corporate governance principles,remunerate fairly and responsibly means:

Accepted Answer

Remunerating fairly and responsibly in corporate governance principles refers to the link between company performance and executive remuneration. The organization should be able to demonstrate how the pay of top executives is tied to the performance of the company, ensuring that their pay is fair and responsible. Option A and B are incorrect because fair and responsible remuneration refers only to executives and board members, not all employees. Option D is also incorrect because it focuses solely on employee performance, whereas the question is about remuneration principles for executives.

Question 18

The current eight principles for corporate governance outlined by the ASX Corporate Governance Council do not include:

Accepted Answer

The current eight principles for corporate governance outlined by the ASX Corporate Governance Council include all of the choices except for "Respect the rights of customers." The actual eighth principle is "Recognise and manage risk."

Question 19

The basis that the firm's information system rests upon is called:

Accepted Answer

IT infrastructure is the foundation or basis that the firm's information system rests upon.

Question 20

Which of the following is not part of the four main objectives of IT governance?

Accepted Answer

The four main objectives of IT governance are ensuring appropriate management strategies for IT related risks, ensuring consistency with organisational goals, responsible use of IT resources, and ensuring IT alignment with business strategies. Option D goes beyond the scope of governance objectives and focuses on using IT for business opportunities and benefits.

Quiz 7: Internal Controls I

Protecting the IT resources,ensuring the reliable and continuous operations and developing a disaster recovery plan are all aspects of:

Which of the following principle is not part of the principles for corporate governance identified by the ASX Corporate Governance Council?

Organisational decisions about IT infrastructure does NOT necessarily include:

In Australia,it is recommended that the board is made up of:

In terms of IT governance,which of the following is NOT one of the five specific areas that need to be considered by those with the responsibility of managing IT?

What part of an organisation determines the corporate governance?

Which of the following is related to corporate governance? (i) Goal setting (ii) Risk management (iii) Performance measurement and management

In the Australian Securities Exchange's definition of corporate governance,risks should be:

The OECD's definition of corporate governance has specifically outlined the relationships between:

What is the connection between the concept of accountability and corporate governance?

The aspect referring to how IT is going to be used in the organisation and will be a general statement or specification about how IT will be positioned and the role it will play in the organisation as it embarks on meeting customer needs is:

The current eight principles for corporate governance outlined by the ASX Corporate Governance Council do not include:

What could be the result of poor corporate governance in an organisation?

In corporate governance principles,remunerate fairly and responsibly means:

The current eight principles for corporate governance outlined by the ASX Corporate Governance Council do not include:

The basis that the firm's information system rests upon is called:

Which of the following is not part of the four main objectives of IT governance?