Accounting Information Systems 3rd International Edition Vernon Richardson - Solutions

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Explain vendor exploitation.
What is a reasonableness test?
The mailroom receives checks and remittance advices from customers in payment of their accounts receivable. The clerk reviews the documents for completeness and correctness, and manually prepares two copies of a remittance list for control purposes.The clerk sends the checks and one copy of the
A few days later, a hard-copy vendor’s invoice arrives at the AP department. The AP clerk accesses the purchases system from her terminal and reviews the digital purchase order and receiving report to ensure that the items ordered were received and that the bill is correct. The clerk then records
What is IT auditing?
Who initiates a fraud audit within the organization?
Name the tests that auditors perform to gather evidence.
What characteristic conceptually distinguishes internal and external auditing?
Name the two ways in which organizations acquire information systems.
What are the computer ethical issues regarding the environment?
An employee in the receiving department keyed in shipment from a remote terminal and inadvertently omitted the purchase order number. The best application control to detect this error would be a,a. Batch total.b. Missing data check.c. Completeness check.d. Reasonableness test.e. Compatibility test.
What name is given to computer programs that are used for checking the validity and accuracy of transaction data?a. Operating system programs.b. Edit programs.c. Compiler programs.d. Integrated test programs.e. Interrogation programs.
What is employee fraud?
Name the three fraud-motivating forces.
Which of the following is not an example of preventive control?a. Separation of responsibilities for the recording, custodial, and authorization functionsb. Sound personnel practicesc. Documentation of policies and proceduresd. Password authentication software and hardwaree. Source documents for
How are transactions in real-time processing systems edited?a. In a separate computer runb. In online mode as transactions are enteredc. During a backup procedured. Not edited due to time constraintse. Editing transactions in real-time is not necessary
Which of the following is NOT an element of the fraud triangle?a. Ethicsb. Justifiable reliancec. Situational pressured. Opportunitye. All the above are elements
Which statement is NOT true?a. Manufacturing firms have a conversion cycle but retail firms do not.b. The conversion cycle includes the task of determining raw materials requirements.c. A payroll check is an example of a product document of the payroll system.d. A general journal may be replaced by
Which of the following files is a temporary file?a. Reference fileb. Transaction filec. Master filed. None of the above
Why might an auditor use a program flow chart?
What is task-data dependency?
What is the database model?
What are the advantages of real-time data processing?
What are the advantages of real-time data collection?
What are the often-cited benefits of IT outsourcing?
Define commodity IT asset.
Define specific asset.
A manufacturing company has a sales force that works remotely visiting clients in their assigned sales area. The sales staff access the company’s central computer system via their laptops to submit sales invoices, access customer credit and sales data, and check e-mail.RequiredDescribe the types
Mary Scott has a master’s degree in computer science and experience as a network engineer. For the past two years, however, she has worked for Hoffman Inc. as an accounts payable clerk. She did not disclose her technology background on her resume when she applied for the clerk position. Early on,
What is an access token?
Which of the following is not an operating system objective?a. The operating system must protect itself from users.b. The operating system must protect users from themselves.c. The operating system must be protected from its environment.d. The operating system must protect users from each other.e.
Some relevant database tables and attributes are presented in the figure designated Problem 12 on the following page.Requireda. Create a database authorization table for an accounts payable clerk. Structure your response similar to the example below: Indicate the name of each table the AP
Distinguish between network-level and application-level firewalls.
What is DPI?
What is the flat-file model?
What is the most striking difference between the database model and the flat-file model?
A coding scheme in the form of acronyms and other combinations that convey meaning is a(n).a. Sequential code.b. Mnemonic code.c. Alphabetic code.d. Block code.
Using the flowchart structure presented in Figure 2- 25 in the text, prepare a system flowchart of the process outlined in Problem 3. Assume the following: Hard-copy timesheets are submitted by employees to department management. Managers submit the time sheet data digitally from their department
Which statement is NOT correct?a. Legacy systems do not process financially significant transactions.b. Mainframes are exclusive to legacy systems, while modern systems use only the client server model.c. Legacy systems may use database technology.d. All the above are true.
An invoice file would best be coded using a(n) coding _____________ scheme.a. Alphabeticb. Mnemonicc. Blockd. Sequential
A database deadlocka. Is a lock placed on a record to prevent it from being accessed by other processes.b. Occurs when two records are accidentally assigned the same primary key.c. Occurs when a unique record is accessed by several different processes simultaneously.d. Is none of the above.
A documentation tool used to represent the logical elements of a system is a(n)a. Data flow diagram.b. Programming flowchart.c. Entity relationship diagram.d. System flowchart.e. All of the above.
Which is the least appropriate type of transaction for a real-time system?a. Airline reservationsb. Point-of-sale transactionsc. Weekly processing of payroll checksd. Air traffic control systemse. All of the above are real-time systems
Which statement is NOT true? Batch processinga. Is subject to deadlocks when processing common accounts.b. Permits data to be edited in a separate computer run.c. Can use databases and flat files.d. Can be initiated from a terminal.
Briefly explain accounting independence.
What types of companies are potential customers for commercial software?
Why are custom systems more expensive than commercial systems?
What two roles are played by accountants with respect to the information system?
What is an ERP system?
Describe cloud computing and explain how it is similar to obtaining a commodity product.
Which statement best describes cloud computing?a. Cloud computing involves long-term contracts.b. Cloud computing is location-independent computing.c. Cloud computing involves an organization selling its IT resources to a vendor and leasing back IT services from the vendor.d. Cloud computing
Contrast centralized data processing with distributed data processing. How do the roles of end users differ between the two approaches?
Discuss why it is crucial that internal auditors report solely to the audit committee of the board of directors and answer to no other group.
What is feedback, and how is it useful in an information system?
Which of the following is least likely to be used as evidence by an external auditor?a. Substantive tests resultsb. Work performed by internal auditors who organizationally report to the controllerc. Tests of controls resultsd. Work performed by internal auditors who report to the audit committee
What are the levels of data hierarchy?
What rules govern data collection? What rules govern data collection?
Which of the following is NOT a characteristic of effective information?a. Relevanceb. Precisionc. Accuracyd. Summarization
What is discretionary reporting?
Classify the following as tasks performed by either: TPS—transaction processing system FRS—financial reporting system MRS—management reporting system a. Preparation of balance sheetb. Capture customer sales orderc. Preparation of variance reportsd. Preparation of budgetse.
Distinguish between AIS and MIS.
Which of the following are objectives of the data collection activity within the general model for AIS?a. Relevant and redundantb. Efficient and relevantc. Efficient and redundantd. Efficient and objective
Redraw the diagram presented in Problem 2. Label each element in the diagram and briefly describe its role and key features. The Information System PROBLEM 2
At what level of management is the long-range planning function most important?a. For staff functionsb. At top-management levelsc. At middle-management levelsd. At lower-management levelse. For line functions
An XBRL taxonomy isa. A classification scheme page.b. The final product (report).c. The document format used to produce web.d. A tag stored in each database record.
Hercules Inc. uses a performance reporting system that shows data for each subordinate employee who reports to a supervisor, the actual costs incurred during the period, the budgeted costs, and all variances from budget for that subordinate’s department. The name of this reporting system isa.
Discuss two internal threats to big data security.
What is an XBRL taxonomy?
Define small data analytics.
What is goal congruence?
Discuss the three Vs of big data analytics.
How are prescriptive and predictive analytics different from descriptive analytics?
Which of the following statements is most true?a. Journal vouchers authorize all GL postings in a real-time GLS.b. Adjusting and reversing entries to the GL do not require journal vouchers because these entries are not transactions.c. Batch processing of journal vouchers is common for large
Which of the following is NOT an output report of the financial reporting system?a. Tax returnb. Variance analysis reportc. Statement of cash flowsd. Comparative balance sheet
Which of the following statements is most true?a. The primary difference between big data and small data is size.b. Because an organization’s unstructured data are of little or no value to outsiders, security over big data analytics is not an issue.c. Big data outsourcing activities are not
An XBRL instance document isa. The document format used to produce web pages.b. The final product (report).c. A classification scheme.d. A tag stored in each database record.
Which of the following is not a data analytics security issue for?a. Internet intrusionb. Outsourcing to a service providerc. Employees with excessive access privilegesd. All of the above are security issuese. None of the above are security issues
Using the flowchart of a purchases system for Problem 8, identify six major physical control weaknesses in the system. Discuss the unmitigated risks associated with each weakness.In Problem 8 Vendor Purchase Order Invoice Check Purchases Inventory Control Purchasing Prepares Three Copies of
In 1989, Robert Smith opened a small fruit and vegetable market in Bethlehem, Pennsylvania. Originally, Smith sold only produce grown on his family farm and orchard. As the market’s popularity grew, however, he added bread, canned goods, fresh meats, and a limited supply of frozen goods. Today
Which of the following tasks should the cash disbursements clerk NOT perform?a. Approve the liabilityb. Review the supporting documents for completeness and accuracyc. Prepare checksd. Mark the supporting documents paid
Which of the following expenditure cycle tasks should not be separated?a. Purchasing inventory items and updating inventory subsidiary ledgerb. Storing inventory in the warehouse and updating inventory subsidiary ledgerc. Updating accounts payable records and posting to the cash disbursements
What is central to a successful EDI implementation?
Which one of the following departments does not use a copy of the receiving report?a. The warehouseb. Accounts payablec. General ledgerd. The purchasing department
Which document typically triggers the three-way match?a. Purchase requisitionb. Supplier’s invoicec. Purchase orderd. Receiving report
Which of the following represents incompatible tasks?a. Accounts payable is responsible for paying invoices.b. Cash disbursement maintains the check register.c. Accounts payable maintains the AP subsidiary ledger.d. Accounts payable is responsible for authorizing payment of invoices.
In the basic technology system, the inventory control clerk reviews the purchase requisition file to identify inventory needs. Explain how this file is created.
Posavek is a wholesale supplier of building supplies to building contractors, hardware stores, and home improvement centers in the Boston metropolitan area. Over the years, Po savek has expanded its operations to serve customers across the nation and now employs over 200 people as technical
Which of the following documents would most likely provide audit evidence of an unrecorded liability?a. Invoicesb. Receiving reportsc. Purchase ordersd. Purchase requisitions
How does the general control area of systems development and program change impact day to- day transaction processing?
Which ledger can be updated solely from the receiving report?a. General ledgerb. Standard cost inventory ledgerc. Actual cost inventory subsidiary ledgerd. Accounts payable subsidiary ledger
Which of the following describe incompatible duties?a. Authorizing payment and writing checksb. Matching purchase orders, receiving reports and invoices, and authorizing paymentc. Authorizing payment and maintaining the accounts payable subsidiary ledgerd. All the above are incompatible tasks
What is a three-way match?
Name a company that sells to a niche market customer segment. What are some characteristics of that company’s products?
Which of the following is a typical key performance indicator for the process perspective?a. Return on equityb. Employee skillsc. Market shared. Process cycle timee. Sales growth
Name a company that segments their customer segment. What are some characteristics of that company’s products?
Which of the following is a typical key performance indicator for the learning and growth perspective?a. Return on equityb. Market sharec. Process costd. Sales growthe. Employee skills
The COSO ERM 2017 framework codifies 20 principles associated with the five components of enterprise risk management. Match the following principles with the five components. COSO ERM Principles a. Report on risk, culture, and performance b. Review risk and performance c. Pursue improvement in
COBIT 2019 is a comprehensive framework for information and technology governance and management. This framework has five domains. Indicate the purpose of each domain. COBIT domains a. Align, plan, and organize b. Build, acquire, and implement c. Deliver, service, and support d. Evaluate, direct,
Which of the following is not a component in the COSO 2013 internal control framework?a. Effective operationsb. Control activitiesc. Risk assessmentd. Control environmente. Monitoring
Segregation of duties is an important internal control. What functions must be separated? If ideal segregation of duties is not economically feasible, what are some compensating controls that would help reduce the risk of fraud or error?

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Accounting Information Systems 3rd International Edition Vernon Richardson - Solutions

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