Which of the following factors should not be considered in establishing the priority of audits included in an annual audit plan?
A. Prior audit findings
B. The time period since the last audit
C. Auditee procedural changes
D. Use of audit software
Answer:D. Use of audit software
Explanation: Audit software is just a tool for conducting audits, not a factor for prioritizing them.
Question 2
Which of the following is LEAST likely to be included in a review to assess the risk of fraud in application systems?
A. Volume of transactions
B. Likelihood of error
C. Value of transactions
D. Extent of existing controls
Answer:B. Likelihood of error
Explanation: Errors are usually unintentional, whereas fraud involves intent.
Question 3
An IS auditor discovers evidence of fraud perpetrated with a manager’s user ID. The manager had written the password inside his/her desk drawer. The IS auditor should conclude that:
A. Manager’s assistant perpetrated the fraud.
B. Perpetrator cannot be established beyond doubt.
C. Fraud must have been perpetrated by the manager.
D. System administrator perpetrated the fraud.
Answer:B. Perpetrator cannot be established beyond doubt
Explanation: Writing down a password compromises security, making it impossible to conclusively identify the perpetrator.
Question 4
Which of the following situations would increase the likelihood of fraud?
A. Application programmers are implementing changes to production programs.
B. Application programmers are implementing changes to test programs.
C. Operations support staff are implementing changes to batch schedules.
D. Database administrators are implementing changes to data structures.
Answer:A. Application programmers are implementing changes to production programs
Explanation: Changes to production systems directly impact live data.
Question 5
Neural networks are effective in detecting fraud, because they can:
A. Discover new trends since they are inherently linear.
B. Solve problems where large and general sets of training data are not obtainable.
C. Attack problems that require consideration of a large number of input variables.
D. Make assumptions about shape of any curve relating variables of output.
Answer:C. Attack problems that require consideration of a large number of input variables
Explanation: Neural networks excel at analyzing multiple variables.
