Question 1

Which of the following are likely indicators of ineffective change management?

1. IT management is unable to predict how a change will impact interdependent systems or business processes.

2. There have been significant increases in trouble calls or in support hours logged by programmers.

3. There is a lack of turnover in the systems support and business analyst development groups.

4. Emergency changes that bypass the normal control process frequently are deemed necessary.

Options :

A : 1 and 3 only

B : 2 and 4 only

C : 1, 2, and 4 only

D : 1, 2, 3, and 4

Answer: C

Question 2

Which of the following statements is true regarding reversing entries in an accounting cycled

Options :

A : Reversing all previous closing adjustments is a mandatory step in the accounting cycle

B : Reversing entries should be completed at the end of the next accounting period after recording regular transactions of the period

C : Reversing entries are identical to the adjusting entries made in the previous period.

D : Reversing entries are the exact opposite of the adjustments made in the previous period.

Answer: D

Question 3

When forming an opinion on the adequacy of management's systems of internal control, which of the following findings would provide the most reliable assurance to the chief audit executive?

* During an audit of the hiring process in a law firm, it was discovered that potential employees' credentials were not always confirmed sufficiently. This process remained unchanged at the following audit.

* During an audit of the accounts payable department, auditors calculated that two percent of accounts were paid past due. This condition persisted at a follow up audit.

* During an audit of the vehicle fleet of a rental agency, it was determined that at any given time, eight percent of the vehicles were not operational. During the next audit, this figure had increased.

* During an audit of the cash handling process in a casino, internal audit discovered control deficiencies in the transfer process between the slot machines and the cash counting are

a. It was corrected immediately.

Options :

A : 1 and 3 only

B : 1 and 4 only

C : 2 and 3 only

D : 2 and 4 only

Answer: B

Question 4

Which of the following responsibilities would fall under the role of the chief audit executive, rather than internal audit staff or the audit manager?

Options :

A : Manage and support a quality assurance and improvement program.

B : Maintain industry-specific knowledge appropriate to the audit engagements

C : Set clear performance standards for internal auditors and the internal audit activity.

D : Apply problem-solving techniques for routine situations.

Answer: C

Question 5

Which of the following is a characteristic of just-in-time inventory management systems?

Options :

A : Users determine the optimal level of safety stocks.

B : They are applicable only to large organizations.

C : They do not really increase overall economic efficiency because they merely shift inventory levels further up the supply chain.

D : They rely heavily on high quality materials.

Answer: D

Confidently Practice Online with Free IIA-ACCA Exam Cram

Buying Options: