UNIVERSITY OF MINDANAO

Tagum College

Department of Accounting Education

Accountancy Program

Physically Distanced but Academically Engaged

Self-Instructional Manual (SIM) for Self-Directed Learning (SDL)

Course/Subject: ACP 411 – Auditing in a CIS Environment

Name of Teacher: Jovit G. Cain, CPA, MSA

THIS SIM/SDL MANUAL IS A DRAFT VERSION ONLY; NOT FOR

REPRODUCTION AND DISTRIBUTION OUTSIDE OF ITS INTENDED USE.
THIS IS INTENDED ONLY FOR THE USE OF THE STUDENTS WHO ARE
OFFICIALLY ENROLLED IN THE COURSE/SUBJECT.
EXPECT REVISIONS OF THE MANUAL.
 Department of Accounting Education
Mabini Street, Tagum City
Davao del Norte
Telefax: (084) 655-9591, Local 116

Course Outline: ACP 411 – Auditing in a CIS

Environment

Course Facilitator : Jovit G. Cain

Email : jovitcain8@gmail.com/ jovit_cain@umindanao.edu.ph
Student Consultation : Done online (LMS) or traditional contact
(calls, text, emails)
Mobile : 0995-991-5756
Phone : None
Effectivity Date : May 2021
Mode of Delivery : Distance Education Delivery (DED)
Time Frame : 54 hours
Student Workload : Expected Self-Directed Learning
Pre-requisite : ACP 323
Credit : 3 units
Attendance Requirement : For online sessions: minimum of 95% attendance
For 1-day on campus/onsite review: 100%
attendance; for 1-day on-campus/on-site final
exam: 100% attendance

Course Outline Policies

Areas of Concern Details
This 3-unit course self-instructional manual is
designed for distant learning mode of instructional
delivery with scheduled face to face or virtual
sessions which can be done using LMS, traditional
contact (via cellphone/telephone and SMS) and
social media platforms (e.g. email, private
messenger, Facebook, Viber, WhatsApp, Line, Zoom
Contact and Non-contact Hours and other similar applications) depending on what is
available for both teachers and students.

The expected number of hours will be 54 including

the face to face or virtual sessions. The face to face
sessions shall include the summative assessment
tasks (exams) since this course is crucial in the
licensure examination for Certified Public
Accountant.
Submission of assessment tasks shall be on the 2nd,
4th, and 6th week of the class. Moreover, specific
Assessment Task Submission dates of submission are specified in the Course
Schedules Section of this manual. The assessment
paper shall be attached with cover page including the

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 Department of Accounting Education
Mabini Street, Tagum City
Davao del Norte
Telefax: (084) 655-9591, Local 116

title of assessment task (if the task is performance),

the name of the course coordinator, date of
submission and name of the student. The document
shall be submitted to the course coordinator thru LMS
(Quipper), email, FB messenger or thru any means
accessible to students. It is also expected that you
already paid your tuition and other fees before the
submission of the assessment task.

If the assessment task is done in real time through

the features of LMS accessible to students, the
schedule shall be arranged ahead of time by the
course coordinator.

Since this course is included in the licensure

examination for CPAs, you will be required to take the
Multiple Choice Question Exam inside the school.
This should be scheduled ahead of time by your
course coordinator. This is non-negotiable for all
licensure-based programs.
Turnitin Submission To ensure honesty and authenticity, all assessment
(if necessary) tasks are required to be submitted thru Turnitin with
a maximum similarity index of 30% allowed. This
means that if your paper goes beyond 30%, the
students will either opt to redo her/his paper or
explain in writing addressed to the course coordinator
the reasons for similarity. In addition, if the paper has
reached more than 30% similarity index, the student
may be called for a disciplinary action in accordance
with the University’s OPM on Intellectual and
Academic Honesty.

Please note that academic dishonesty such as

cheating and commissioning other students or people
to complete the task for you have severe
punishments (reprimand, warning, expulsion).
The score for an assessment item submitted after the
designated time on the due date, without an
approved extension of time, will be reduced by 5% of
the possible maximum score for that assessment
item for each day or part day that the assessment
Penalties for Late item is late.
Assignments/Assessments
However, if the late submission of assessment paper
has a valid reason, a letter of explanation should be
submitted and approved by the course coordinator. If
necessary, you will also be required to present/attach
evidences.

3

Return of Assignments/
Assessments
Assignment Resubmission
Re-marking of Assessment
Papers and Appeal
Grading System
Preferred Referencing Style
Department of Accounting Education
Mabini Street, Tagum City
Davao del Norte
Telefax: (084) 655-9591, Local 116
Assessment tasks will be returned to you one (1)
week after the submission. This will be returned by
LMS, email, FB messenger or any other
communication platforms available for both teacher
and students.
For some group assessment tasks, the course
coordinator will require some or few of the students
for online or virtual sessions to ask clarificatory
questions to validate the originality of the assessment
task submitted and to ensure that all the group
members are involved.
You should request in writing addressed to the
course coordinator his/her intention to resubmit an
assessment task. The resubmission is premised on
the student’s failure to comply with the similarity index
and other standards or other reasonable
circumstances e.g. illness, accidents, financial
constraints.
You should request in writing addressed to the
program coordinator your intention to appeal or
contest the score given to an assessment task. The
letter should explicitly explain the reasons/points to
contest the grade. The program coordinator shall
communicate with the students on the approval or
disapproval of the request.
If disapproved by the course coordinator, you can
elevate your case to the program head or the dean
with the original letter of request. The final decision
will come from the Dean of College.
You shall be evaluated based on the following:
Assessment methods Weights
EXAMINATIONS 60%
A. Exam – Prelim & Midterm 30%
B. Final Exam 30%
CLASS PARTICIPATIONS 40%
C. Quizzes 10%
D. Assignments 5%
E. Research/Requirement 15%
F. Oral recitation 10%
Total 100%
Submission of the final grades shall follow the usual
University system and procedures.
Use the general practice of APA 6th edition.
4

Student Communication
Contact Details of the Dean
Contact Details of the
Assistant Dean
Contact Details of the
Program Head
Student with Special Needs
Library Contact Details
Department of Accounting Education
Mabini Street, Tagum City
Davao del Norte
Telefax: (084) 655-9591, Local 116
The course coordinator shall create Group Chat in FB
messenger for the class. Each student shall create a
Quipper account. The course coordinator will then
provide a Quipper access code to the students for
them to enroll to have access to the materials and
resources of the course. All communication formats:
chat, submission of assessment tasks, request, etc.
may be done thru any platforms available for the
convenience of teacher and students.
You can also meet the course coordinator in person
through the scheduled face to face sessions to raise
your issues and concerns.
Dr. Gina Fe G. Israel, EdD
Email: deansofficetagum@umindanao.edu.ph
Mobile: 09099942314
Larcyneil P. Pascual, MAED
Email: larcyneil.pascual@umindanao.edu.ph
Mobile: 09187772524
For Accountancy:
Mary Cris L. Luzada, CPA, MSA
Email: luzadacris@umindanao.edu.ph
Mobile: 09228321794
For Accounting Technology:
Maria Teresa A. Ozoa, CPA, MBA
Email: ozoamateresa@umindanao.edu.ph
Mobile: 09472657119
Students with special needs shall communicate with
the course coordinator about the nature of his or her
special needs. Depending on the nature of the need,
the course coordinator with the approval of the
program coordinator may provide alternative
assessment tasks or extension of the deadline of
submission of assessment tasks. However, the
alternative assessment tasks should still be in the
service of achieving the desired course learning
outcomes.
Clarissa R. Donayre, MSLS
Chief Librarian
Email: lictagum@umindanao.edu.ph
Mobile: 09273951639
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 Department of Accounting Education
Mabini Street, Tagum City
Davao del Norte
Telefax: (084) 655-9591, Local 116

Well Being Welfare Support Rochen D. Yntig, RGC

Help Desk Contact Details Head
Email: chenny.yntig@gmail.com
Number: 0932 7717 219

Mersun Faith A. Delco, RPm

Psychometrician
Email: mersunfaithdelco@gmail.com
Number: 0927 6086 037

Alfred Joshua M. Navarro

Facilitator
Email: is40fotb@gmail.com
Number: 0977 3416 064

Course Information – see/download course syllabus from Quipper

or other available platforms

CC’s Voice:
Hello there! Welcome to this course Comed 421: Auditing in a CIS Environment.
This course reinforce students in dealing with audit processes as well as test of
controls and substantive testing in a computerized environment with Computer
Assisted Audit Techniques (CAATs) using MS Excel. As future CPA, it is important
for you to gain understanding about the topics helpful in audit matters as it would
help you to be competitive enough in the industry you are engaging in the near
future and for passing the licensure exam for CPA. I hope that you enjoy while
learning this course!

Course Outcome (CO):

This course complements the course in auditing. It discusses information
technology (IT) -related risks security and control mechanisms and techniques that
may be employed to address the risks, and the impact of computer use on the audit.
It also introduces computer assisted audit techniques and tools. In this course,
students gain an appreciation of the particular features and understanding of the
risks involved in auditing in a CIS environment, the CIS controls they would expect
to find in this particular area, how auditors use CAATS ( Computed Assisted Audit
Techniques) in this area. The students gain hands-on experience in the use of
computers in performing audits.

Let us begin!

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 Department of Accounting Education
Mabini Street, Tagum City
Davao del Norte
Telefax: (084) 655-9591, Local 116

Big Picture A

Week 1–2: Unit Learning Outcomes (ULO): At the end of the unit, you are
expected to:
a. Discuss information systems audit.
b. Explain the computer assisted auditing techniques, data warehousing and
Microsoft Excel.

Big Picture in Focus: ULOa. Discuss information

systems audit.

Metalanguage
In this section, the most essential terms relevant to the topic and to demonstrate
ULOa will be operationally defined to establish a common frame of reference as to
how the texts work in your chosen field or career.

1. Information systems audit – it refers to organization function that evaluates

asset safeguarding, data integrity, system effectiveness, and system efficiency
in computer - based information systems.

2. Computer Fraud – it refers to unauthorized access to computer and computer

software which uses electronic resources to present fraudulent or
misrepresented information as a means of deception.

Essential Knowledge

To perform the aforesaid big picture (unit learning outcomes) for two (2) weeks
of the course, you need to fully understand the following essential knowledge that will
be laid down in the succeeding pages. Please note that you are not limited to
exclusively refer to these resources. Thus, you are expected to utilize other books,
research articles and other resources that are available in the university’s library e.g.
ebrary, search.proquest.com etc.

1. Information system. It refers to the methods and records that an entity

establishes to record, process, summarize, and report transactions and to
maintain accountability for the related assets , liabilities and equities .

2. Information systems auditing (ISA). It is a function that has been developed

to assess whether computer systems safeguard assets, maintain data integrity,
and allow the goals of an organization to be achieved effectively and resources
used efficiently. ISA, in short, is an organization function that evaluates asset
safeguarding, data integrity, system effectiveness, and system efficiency in

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 Department of Accounting Education
Mabini Street, Tagum City
Davao del Norte
Telefax: (084) 655-9591, Local 116

computer - based information systems. These objectives are important to

individuals who work both inside and outside organizations. For example,
managers who are working within an organization use computer systems that
will enable them to maximize the return on the shareholders' funds invested in
entity. Outside an organization, groups such labor unions are interested in how
an organization uses its computer system.

3. Why Audit of Computers is Necessary. Information systems audit has arisen

for the following significant reasons :

3.1. Consequences and Costs of Data Loss. Accurate and up - to - date data
make up a critical resource necessary not only for an organization's continuing
operations but also to ensure that they maintain their competitiveness. Losses
can occur when existing controls over computers are lax. For example, if
accounts receivable file of a large manufacturing company is destroyed through
computer program error, sabotage or nature disaster. If the file cannot be
recovered and no back up for computer files has been provided, the entity can
suffer a major loss in cash receipts, because of customers failure to pay their
debts, either intentionally or due to inadequacy of their own records.

3.2. Misallocation of Resources because of decisions based on incorrect

data. Managers need and base their business decisions, both short - run and
strategic, on data provided by the computer - based information systems. If
managers are making strategic planning decisions, minor errors in the data
might be tolerated, given the long - run nature of these decisions and inherent
uncertainty surrounding them. If managers are making management control
and operating control decisions, inaccurate data can cause costly, unnecessary
investigation to be undertaken or out - of control process to remain undetected.
Poor investment decisions might be made by the various stakeholders, owners,
creditors and so forth when provided with inaccurate financial information.

3.3. Computer Fraud. Computer abuse is considered the major stimulus for
developing information systems audit functions within organizations. Major
computer frauds brought to general attention two issues that have deeply
concerned auditors - ensuring data integrity and proper system functioning .
The following are some major computer abuse that an organization might
encounter:

Type of Abuse Explanation

Salami Technique Calculations are inappropriately rounded off to the
benefit of the fraud perpetrator. Amounts available for
rounding such as interest to bank depositors, are
placed in an account controlled by the perpetrator.
Viruses Programs infecting authorized programs with
unauthorized information or instructions. They can
spread by other electronic transfer of information
between systems or the physical exchange of media,
such as disks carried from one system to another.

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 Department of Accounting Education
Mabini Street, Tagum City
Davao del Norte
Telefax: (084) 655-9591, Local 116

Hacking Perpetrator gains unauthorized access in a computer

system to read, modify or delete program or data to
disrupt services.
Trojan Horse An unauthorized program is placed within an
authorized one. Trojan horses are designed to wait
until a specific time, when they act and then erase all
evidence of their existence. Fired or terminated
employees have used Trojan horses to destroy their
employers' data.
Trapdoors These are unauthorized entry points into programs or
databases. For example, a programmer who has an
unauthorized entry point into the collection program is
able to write off accounts without proper approval .
Abuse of privileges This involves theft of computer time. In several cases
employees were discovered operating their own
computer businesses illegally by using their employers'
computers.

Computer abuse could cause destruction, modification and theft of assets,

privacy, violation, disruption of operation and even physical harm to personnel.

3.4. Loss of Significant Investments in Hardware , Software and

Personnel. Intentional or unintentional loss of hardware can cause
considerable disruption and multimillion peso investments. Also if software is
corrupted or destroyed, operations will be disrupted, confidential information
could be disclosed to competitors or if the software is a proprietary package,
lost revenues and lawsuits could arise. Personnel are always a valuable
resource particularly in light of an ongoing scarcity of well - trained computer
professionals in many countries.

3.5. Maintenance of Privacy. Powerful data processing capabilities of

computers, particularly their rapid throughput, integration and retrieval
capabilities cause many people to worry about losing their privacy. As a result,
computer professionals are now coming under increasing pressure to prevent
computers compromising the privacy of individuals.

3.6. Societal Costs of Computer Use. Often, conflicts arise over how
computer technology should be used in our societies. Of course, it might be
argued that technology is neutral, it is neither good nor bad. For example, some
computer scientists continue to be concerned about using computers to support
nuclear weapons command and control systems. They argue that the reliability
of complex computer systems cannot be guaranteed and that the
consequences of using unreliable computer systems can be catastrophic. In
this light, important ongoing decisions must be made about how computers
should be used in our societies.

4. Objectives of Information Systems Audit. Information systems auditing

supports traditional audit objectives (those of the external auditor) that focus on

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 Department of Accounting Education
Mabini Street, Tagum City
Davao del Norte
Telefax: (084) 655-9591, Local 116

(a) asset safeguarding, (b) data integrity, (c) system effectiveness, and (d)
system efficiency.

4.1. Asset Safeguarding Objectives. The information system assets of an

organization include hardware, software, facilities, people (knowledge), data
files, system documentation, and supplies. Like all assets, they must be
protected by a system of internal control. Hardware can be damaged
maliciously. Proprietary software and the contents of data files can be stolen or
destroyed. Supplies of negotiable forms can be used for unauthorized
purposes. These assets are often concentrated in one or a small number of
locations, such as a single disk. As a result, asset safeguarding data item to
reduce the profitability of the organization and to bring especially important
objective for many organizations to achieve.

4.2. Data Integrity Objectives. Data integrity is a fundamental concept in

information systems auditing. It is a state implying data has certain attributes:
completeness, soundness, purity, and veracity. If data integrity is not
maintained, an organization no longer has a true representation of itself or of
events. Moreover, if the integrity of an organization's data is low, it could suffer
from a loss of competitive advantage (see, e.g., Redman 1995 and Strong et.
al. 1997). Nonetheless, maintaining data integrity can be achieved only at a
cost. The benefits obtained should exceed the costs of the control procedures
needed. Three major factors affect the value of a data item to an organization
and thus the importance of maintaining the integrity of that data item:

1. The value of the informational content of the data item for individual
decision makers: The informational content of a data item depends on its
ability to change the level of uncertainty surrounding a decision and, as a
result, to change the expected payoffs of the decisions that might be
made. These notions have been well developed within statistical decision
theory.

2. The extent to which the data item is shared among decision makers: If
data is shared, corruption of data integrity affects not just one user but
many. The value of a data item is some aggregate function of the value
of the data item to the individual users of the data item. Thus,
maintenance of data integrity becomes more critical in a shared data
environment.

3. The value of the data item to competitors: If a data item is valuable to a

competitor, its loss might undermine an organization's position in the
marketplace. Competitors could exploit the informational content of the
data item to reduce the profitability of the organization and to bring about
bankruptcy, liquidation, takeover, or merger.

5. System Effectiveness Objectiveness. An effective information system

accomplishes its objectives. Evaluating effectiveness implies knowledge of
user needs. To evaluate whether a system reports information in a way that

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 Department of Accounting Education
Mabini Street, Tagum City
Davao del Norte
Telefax: (084) 655-9591, Local 116

facilities decision making by its users, auditors must know the characteristics of
users and the decision - making environment

Effectiveness auditing often occurs after a system has been running for some
time. Management requests a post - audit to determine whether the system is
achieving its stated objectives. This evaluation provides input to the decision
on whether to scrap the system, continue running it, or modify it in some way.

Effectiveness auditing can also be carried out during the design stages of a
system. Users often have difficulty identifying or agreeing on their needs.
Moreover, substantial communication problems often occur between system
designers and users. If a system is complex and costly to implement,
management might want auditors to perform an independent evaluation of
whether the design is likely to fulfill user needs.

6. System Efficiency Objectives. An efficient information system uses minimum

resources to achieve its required objectives. Information systems consume
various resources: machine time, peripherals, system software, and labor.
These resources are scarce, and different application systems usually compete
for their use.

The question of whether an information system is efficient often has no clear -

cut answer. The efficiency of any particular system cannot be considered in
isolation from other systems. Problems of suboptimization occur if one system
is “optimized” at the expense of other systems. For example, minimizing an
application system's execution time might require dedication of some hardware
resource (e.g., a printer) to that system. The system might not use the hardware
fully, however, while it undertakes its work. The slack resource will not be
available to other application systems if it is dedicated to one system.

System efficiency becomes especially important when a computer no longer

has excess capacity. The performance of individual application systems
degrades (e.g., slower response times occur), and users can become
increasingly frustrated. Management must then decide whether efficiency can
be improved or extra resources must be purchased. Because extra hardware
and software is a cost issue, management needs to know whether available
capacity has been exhausted because individual application systems are
inefficient or because existing allocations of computer resources are causing
bottlenecks. Because auditors are perceived to be independent, management
might ask them to assist with or even perform this.

7. Foundation of Information Systems Audit. Information systems auditing is

not just a simple extension of traditional auditing. Recognition of the need for
an information systems audit function comes from two directions. First, auditors
realized that computers had affected their ability to perform the attest function.
Second, both corporate and information systems management recognized that
computers are valuable resources that needed controlling like any other key
resource within an organization.

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 Department of Accounting Education
Mabini Street, Tagum City
Davao del Norte
Telefax: (084) 655-9591, Local 116

The discipline of information systems auditing has been shaped by knowledge

obtained from four other disciplines: traditional auditing, information systems
management, behavioral science, and computer science.

Information systems auditing borrows much of its theory and methodologies

from other areas. Traditional auditing contributes knowledge of internal control
practices and an overall control philosophy. Information systems management
provides methodologies necessary to achieve successful design and
implementation of systems. Behavioral science indicates when and why
information systems are likely to fail because of people problems. Computer
science contributes knowledge about how hardware and software should be
designed to be effective and efficient and to safeguard assets and maintain
data integrity.

7.1. Traditional Auditing. It brought to information systems auditing a wealth

of knowledge and experience with internal control techniques. This has had a
very significant impact on the design of both the manual and machine
components of an information system. For instance, in a computer system,
clerical activities, such as data preparation activities, are often a critical
component of the system. As with the manual systems, these activities should
be subject to internal control principles such as incompatible, having competent
and trustworthy personnel, and establishing clear definitions of duties. By
applying these principles, management seeks to ensure that the integrity of
data is maintained before it is entered into the computer - based components
of the information system.

Furthermore, traditional auditing concepts like control totals are also relevant to
the update and maintenance of files by computer programs. Computer
programs must ensure that all transaction data are processed correctly. Control
totals have had longstanding use in information systems because these
concerns also exist when humans (rather than programs) update and maintain
files.

The general methodologies for evidence collection and evidence evaluation

used by information system auditors are also based on traditional auditing
methodologies The extensive experience gained in traditional auditing
highlights the critical importance of having objective , verifiable evidence and
an independent evaluation of information systems .

Most importantly, traditional auditing brings to information systems auditing a

control philosophy. The philosophy involves examining information systems
with a critical mind, always with a view to questioning the capability of an
information system to safeguard assets, maintain data integrity, and achieve its
objectives effectively and efficiently.

7.2. Information System Management. For the last four decades, researchers
have made advances and identified better ways of managing the development
and implementation of information systems. For example, techniques of project

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 Department of Accounting Education
Mabini Street, Tagum City
Davao del Norte
Telefax: (084) 655-9591, Local 116

management have been carried across into the information systems area with
considerable success. Documentation, standards, budgets, and variance
investigation are now emphasized. Better ways of developing and
implementing systems have been developed. For example, object - oriented
analysis, design, and programming have enabled programmers to develop
software faster, with fewer errors and easier maintenance characteristics.
These advances affect information systems auditing because they ultimately
affect asset safeguarding, data integrity, system effectiveness, and system
efficiency objectives.

7.3. Behavioral Science. One of the reasons why computer science fails is
because their designers do not consider the difficult and sometimes complex
human issues associated with the development and implementation of a
system. For example, if there is behavioral resistance to an information system,
the efforts to meet objectives of asset safeguarding, data integrity, system
effectiveness and system efficiency could fail. Furthermore, communication
between designers and users could be difficult because of differences in
understanding of the meaning inherent in an application domain. Because of
these difficulties, a system's requirement might be poorly formulated.

Conditions that can lead to behavioral problems could result to possible system
failure. Systems designers should therefore consider concurrently the impact
of a computer system on task accomplishment (the technical system) and the
quality of work life of persons (the social system) within the organization.

7.4. Computer Science. In conducting continuous research, computer

scientists give significant attention on how asset safeguarding, data integrity,
system effectiveness and system efficiency objectives might be better
achieved. They have made studies on how to prove the correctness of software
formally, build fault - tolerant computer systems, design secure operating
systems and transmit data securely across a communication's link.

This in - depth technical knowledge that has been developed with the discipline
of computer science provides both benefits and problems for auditors. Auditors
can now be less concerned about the reliability of certain components in a
computer system. On the other hand, if this technical knowledge is used
improperly they might have difficulty detecting the abuse. For example, if a
skilled systems programmer decides to perpetrate a fraud, it may be impossible
for auditors to detect the fraud unless they have extensive knowledge of
information technology.

Self-Help: You can also refer to the sources below to help you
further understand the lesson:

* Cabrera, M. B. (2015).Management consultancy: Principles and Engagement

(2015), Philippines: GIC Enterprises & CO., Inc.

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 Department of Accounting Education
Mabini Street, Tagum City
Davao del Norte
Telefax: (084) 655-9591, Local 116

* Bobadilla, A. D. (2015). Comprehensive reviewer in auditing theory. Manila,

Philippines: Lares Bookstore.

* Roque, G. (2018). CPA examination reviewer: Auditing theory (2018-2019 ed).

Manila, Philippines: GIC enterprises & Co., Inc.

Let’s Check
Activity 1. Mutiple Choice Questions. Encircle the letter that corresponds to your
answer.

1. The management change level of adoption requires users of an information

system to:
a. Treat the system as a black box and use the information or solution to
the problem provided by the system.
b. Have an elementary understanding of the system so it can be used as a
tool to find answer to specific problems.
c. Rethink their view of their job and the way in which they perform their job
d. Develop a fundamental appreciation of the analytical approach used by
the system to solve a problem.

2. Which of the following is least likely to be used as a measure of information

quality during the conduct of an evaluation of information system effectiveness?
a. Timeliness
b. Comprehensibility
c. Usefulness of functionality
d. Precision

3. Which of the following is least likely to be an important association that auditors

would find when conducting an evaluation of information system effectiveness?
a. Between computer self-efficacy and perceived ease of use
b. Between perceived system quality and perceived usefulness
c. Between system quality and computer self-efficacy
d. Between perceived usefulness and type of use

4. Which of the following steps most likely will be undertaken first when evaluating
the effectiveness of an information system?
a. Identify the objectives of the information system
b. Identify the sources of effectiveness data
c. Select the effectiveness measures to be used
d. Obtain the ex ante values of effectiveness

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 Department of Accounting Education
Mabini Street, Tagum City
Davao del Norte
Telefax: (084) 655-9591, Local 116

5. A major contribution of computer science to the discipline of information

systems auditing has been:
a. Insights into how generalized audit software should be developed.
b. An understanding of why behavioral problems occur with information
systems implementation
c. An understanding of how project management techniques can contribute
to information systems success.
d. The development of theoretical bases underlying the ways in which
software and hardware reliability can be improved.

Let’s Analyze

Activity 1. For each of the following independent situations, identify the control
weakness that permitted the error or fraud, and indicate how the weakness should be
corrected.

1. In a computerized sales processing system, numerous pricing errors appeared on

customer invoices.

________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
_______________________________________________________________.

2. Yami Sukehiro, a computer programmer for a bank, set up a demand

deposit account in his name. He then wrote a program subroutine that
automatically transferred funds from accounts that had shown no activity for at
least three months to the newly-established account.

________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________

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 Department of Accounting Education
Mabini Street, Tagum City
Davao del Norte
Telefax: (084) 655-9591, Local 116

________________________________________________________________
_______________________________________________________________.

3. In a computerized payroll system, foremen, in collusion with employees, were able

to inflate pay rates. In addition, terminated employees were retained on the payroll
and the fraudulent checks were endorsed by a foreman or employee and
deposited in his or her personal account.

________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
_______________________________________________________________.

4. After implementing a newly-designed EDI system with its vendors, Hilo

Enterprises discovered numerous errors in type, pricing, and quantity of goods
received versus goods ordered.

________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
_______________________________________________________________.

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 Department of Accounting Education
Mabini Street, Tagum City
Davao del Norte
Telefax: (084) 655-9591, Local 116

In a Nutshell
In this part you are going to jot down what you have learned in this unit. The
said statement of yours could be in a form of concluding statements, arguments, or
perspective you have drawn from this lesson.
1. ________________________________________________________.
2. ________________________________________________________.
3. ________________________________________________________.
4. ________________________________________________________.
5. ________________________________________________________.

Q&A List
In this section you are going to list what boggles you in this unit. You may
indicate your questions but noting you have to indicate the answers after your question
is being raised and clarified. You can write your questions below.

Questions/Issues Answers

1.

2.

3.

4.

5.

Keyword Index
• Information System
• Information Systems Auditing (ISA)
• Computer Fraud
• Data integrity
• Traditional Auditing
• Information System Management
• Behavioral Science
• Computer Science

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