ACCT 303

Computer Control & Audit

Quiz # 1

Points: 20

ID#: __________________________

Semester: 082
Time : 20 minutes

Name:__________________________________

Multiple Choice Questions:

1. Over which type of risk does the auditor have the greatest control:
a) Desired audit risk
b) Inherent control risk
c) Control risk
d) Detection risk
2. The primary objective of tests of controls is to:
a. Determine whether controls are operating effectively
b. Identify any material errors that have occurred in major classes of transactions
c. Understand whether a control is in place
d. Identify major patterns of errors or irregularities that might exist in final
account balances
3. Compared to auditing around the computer, which of the following statements about
auditing through the computer is true:
(a) the auditor is less dependent on inferring the quality of processing via test of input
and output
(b) the inherent risk is lower because more comprehensive tests of controls are taken
(c) greater reliance is placed upon the reliability and effectiveness of user controls
(d) the desired audit risk will be higher
4. A program check that ensures data entered by a data-entry operator is complete is an
example of:
a) Detective control
b) Corrective control
c) Preventive control
d) Redundancy control
5. In a computer system, the audit trail is :
a) Still always present in some hard-copy form
b) Disappearing as more online, real time updated systems are used
c) Produced automatically by software during the update process
d) Sometimes more extensive than the audit trail in manual systems if it is designed properly
Answer the following questions:
1. Distinguish between errors & irregularities in the context of an Information System.

2. What is GAAS? What are the three types of GAAS? State one standard for each type.

3. Explain the concept of Audit Risk (AR)in the context of an organization using a model. How does
Detection Risk (DR) help minimize the AR?