Auditing Computer-Based Information Systems Exam Questions and Answers with Complete
Solutions. Chapter 11.
Auditing - Answers the systematic process of obtaining and evaluating evidence regarding assertions
about economic actions and events in order to determine how well they correspond with established
criteria.
Internal Auditing - Answers an independent, objective assurance and consulting activity designed to add
value and improve organizational effectiveness and efficiency, including assisting in the design and
implementation of an AIS.
Financial Audit - Answers examines the reliability and integrity of financial transactions, accounting
records, and financial statements.
Information Systems Audit (internal control audit) - Answers reviews the controls of an AIS to assess its
compliance with internal control policies and procedures and its effectiveness in safeguarding assets
Operational Audit - Answers concerned with the economical and efficient use of resources and the
accomplishment of established goals and objectives
Compliance Audit - Answers determines whether entities are complying with applicable laws,
regulations, policies, and procedures
Investigative Audit - Answers examines incidents of possible fraud, misappropriation of assets, waste
and abuse, or improper governmental activities
Audit Planning - Answers determines why, how, when, and by whom the audit will be performed
Inherent Risk - Answers the susceptibility to material risk in the absence of controls
Control Risk - Answers the risk that a material misstatement will get through the internal control
structure and into the financial statements
Detection Risk - Answers the risk that auditors and their audit procedures will fail to detect a material
error or misstatement
Most common ways to collect audit evidence: - Answers 1. Observation of activities being audited.
2. Review of documentation to understand how a particular process or internal control system is
supposed to function.
3. Discussions with employees
4. Questionnaires that gather data
5. Physical examination of tangible assets
Solutions. Chapter 11.
Auditing - Answers the systematic process of obtaining and evaluating evidence regarding assertions
about economic actions and events in order to determine how well they correspond with established
criteria.
Internal Auditing - Answers an independent, objective assurance and consulting activity designed to add
value and improve organizational effectiveness and efficiency, including assisting in the design and
implementation of an AIS.
Financial Audit - Answers examines the reliability and integrity of financial transactions, accounting
records, and financial statements.
Information Systems Audit (internal control audit) - Answers reviews the controls of an AIS to assess its
compliance with internal control policies and procedures and its effectiveness in safeguarding assets
Operational Audit - Answers concerned with the economical and efficient use of resources and the
accomplishment of established goals and objectives
Compliance Audit - Answers determines whether entities are complying with applicable laws,
regulations, policies, and procedures
Investigative Audit - Answers examines incidents of possible fraud, misappropriation of assets, waste
and abuse, or improper governmental activities
Audit Planning - Answers determines why, how, when, and by whom the audit will be performed
Inherent Risk - Answers the susceptibility to material risk in the absence of controls
Control Risk - Answers the risk that a material misstatement will get through the internal control
structure and into the financial statements
Detection Risk - Answers the risk that auditors and their audit procedures will fail to detect a material
error or misstatement
Most common ways to collect audit evidence: - Answers 1. Observation of activities being audited.
2. Review of documentation to understand how a particular process or internal control system is
supposed to function.
3. Discussions with employees
4. Questionnaires that gather data
5. Physical examination of tangible assets
