CPA Auditing and Attestation (AUD) : IT Controls 

Study concepts, example questions & explanations for CPA Auditing and Attestation (AUD)

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Example Questions

Example Question #1 : It Controls 

Logical Checks include:

Possible Answers:

Check Digits

All of the above

Validity checks

Limit Tests

Correct answer:

All of the above

Explanation:

Logical checks include:  validity checks, limit checks and check digits

Example Question #2 : It Controls 

Test Data

Possible Answers:

all of the above

data used to check management for fraud

includes erroneous information

data used to test the sample size

Correct answer:

includes erroneous information

Explanation:

Test data will include erroneous data. The purpose of using erroneous data is to assess the system capability of validating data. It uses erroneous data to locate and identify the source of the error.

Example Question #3 : It Controls 

As an audit test, John James CPA uploaded client data to its software and compared the results to the client output. This is an example of

Possible Answers:

Check digits

Parallel simulation

Validity Checks

Embedded audit modules

Correct answer:

Parallel simulation

Explanation:

This is an example of a parallel simulation. The auditor compares the output received from its system with the output received from the client system.

Example Question #4 : It Controls 

Of the following computer-assisted auditing techniques allows fictitious and real transactions to be processed together without client operating personnel being aware of the testing process?

Possible Answers:

Integrated test facility 

Parallel simulation

Data entry monitor

Input control matrix

Correct answer:

Integrated test facility 

Explanation:

An integrated test facility uses test data commingled with actual data to test transactions.

Example Question #1 : Audit Sampling

Processing data through the use of simulated files provide an auditor with information about the operating effectiveness of controls. One of the techniques involved in this approach makes use of:

Possible Answers:

An integrated test facility

Program code checking

Input validation

Controlled reprocessing

Correct answer:

An integrated test facility

Explanation:

An integrated test facility runs test transactions through the live system and posts to simulated files to provide an auditor with information about the operating effectiveness of controls.

Example Question #2 : Audit Sampling

When an engagement team confronts a difficulty in their audit due to a lack of understanding of a certain component of IT, the team should resort to which option?

Possible Answers:

Abandoning the testing area

Assume fraudulent activity

Pursuing an independent IT specialist

Trust management's word

Correct answer:

Pursuing an independent IT specialist

Explanation:

When there is an area of testing which the engagement team feels it would need additional expertise in, the correct option would be to work with a specialist in the field rather than make assumptions, give up, or blindly trust.

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