IT Auditing 4th Ed—Test Bank,
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Test Bank for Information Technology Auditing, 4th
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Edition by James A. Hall ISBN
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Chapter 1—Auditing and Internal Control
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TRUE/FALSE
1. Corporate management (including the CEO) must certify monthly and annually their
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organization‟s internal controls over financial reporting.
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ANS: G i G F PTS: G i G G i G 1
2. Both the SEC and the PCAOB require management to use the COBIT framework for
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assessing internal control adequacy.
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ANS: G i G F PTS: G i G G i G 1
3. Both the SEC and the PCAOB require management to use the COSO framework for
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assessing internal control adequacy.
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ANS: G i G F PTS: G i G G i G 1
4. A qualified opinion on management‟s assessment of internal controls over the financial
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reporting system necessitates a qualified opinion on the financial statements?
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ANS: G i G F PTS: G i G G i G 1
5. The same internal control objectives apply to manual and computer-based information systems.
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ANS: G i G T PTS: G i G G i G 1
6. The external auditor is responsible for establishing and maintaining the internal control system.
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ANS: G i G F PTS: G i G G i G 1
7. Segregation of duties is an example of an internal control procedure.
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protected website or school-approved learning management system for classroom use.
, IT Auditing 4th Ed—Test Bank,
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Chapter 1
ANS: G i G T PTS: G i G G i G 1
8. Preventive controls are passive techniques designed to reduce fraud.
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ANS: G i G T PTS: G i G G i G 1
9. A key modifying assumption in internal control is that the internal control system is the
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responsibility of management.
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ANS: G i G T PTS: G i G G i G 1
© GiG2016 GiGCengage GiGLearning®. G i G May GiGnot GiGbe GiGscanned, GiGcopied GiGor GiGduplicated GiGor GiGposted GiGto GiGa GiGpublicly GiGaccessible GiGwebsite, GiGin GiGwhole GiGor
GiGin GiG part, GiGexcept GiGfor GiG use GiGas GiGpermitted GiGin GiGa G i G license GiGdistributed GiGwith GiGa GiGcertain GiGproduct GiGor GiGservice GiGor GiGotherwise GiGon GiGa GiGpassword-
protected website or school-approved learning management system for classroom use.
, IT Auditing 4th Ed—Test Bank,
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Chapter 1
10. While the Sarbanes-Oxley Act prohibits auditors from providing non-accounting services to
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their audit clients, they are not prohibited from performing such services for non-audit
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clients or privately held companies.
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ANS: G i G T PTS: G i G G i G 1
11. The Sarbanes-Oxley Act requires the audit committee to hire and oversee the external auditors.
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ANS: G i G T PTS: G i G G i G 1
12. Section 404 requires that corporate management (including the CEO) certify their
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organization‟s internal controls on a quarterly and annual basis.
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ANS: G i G F PTS: G i G G i G 1
13. Section 302 requires the management of public companies to assess and formally
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report on the effectiveness of their organization‟s internal controls.
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ANS: G i G F PTS: G i G G i G 1
14. Application controls apply to a wide range of exposures that threaten the integrity
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of all programs processed within the computer environment.
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ANS: G i G F PTS: G i G G i G 1
15. Advisory services is an emerging field that goes beyond the auditor‟s traditional attestation
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function.
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ANS: G i G T PTS: G i G G i G 1
16. An IT auditor expresses an opinion on the fairness of the financial statements.
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ANS: G i G F PTS: G i G G i G 1
17. External auditing is an independent appraisal function established within an organization to
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examine and evaluate its activities as a service to the organization.
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ANS: G i G F PTS: G i G G i G 1
18. External auditors can cooperate with and use evidence gathered by internal audit
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protected website or school-approved learning management system for classroom use.
, IT Auditing 4th Ed—Test Bank, GiG GiG GiG GiG
GiGdepartments that are organizationally independent and that Chapter
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1 the Audit
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GiGCommittee of the Board of Directors.
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GiGin GiG part, GiGexcept GiGfor GiG use GiGas GiGpermitted GiGin GiGa G i G license GiGdistributed GiGwith GiGa GiGcertain GiGproduct GiGor GiGservice GiGor GiGotherwise GiGon GiGa GiGpassword-
protected website or school-approved learning management system for classroom use.
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GiG GiG GiG Chapter 1
Test Bank for Information Technology Auditing, 4th
GiG GiG GiG GiG GiG GiG
Edition by James A. Hall ISBN
GiG GiG GiG GiG GiG GiG
Chapter 1—Auditing and Internal Control
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TRUE/FALSE
1. Corporate management (including the CEO) must certify monthly and annually their
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organization‟s internal controls over financial reporting.
GiG GiG GiG GiG GiG GiG
ANS: G i G F PTS: G i G G i G 1
2. Both the SEC and the PCAOB require management to use the COBIT framework for
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assessing internal control adequacy.
GiG GiG GiG GiG
ANS: G i G F PTS: G i G G i G 1
3. Both the SEC and the PCAOB require management to use the COSO framework for
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assessing internal control adequacy.
GiG GiG GiG GiG
ANS: G i G F PTS: G i G G i G 1
4. A qualified opinion on management‟s assessment of internal controls over the financial
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reporting system necessitates a qualified opinion on the financial statements?
GiG GiG GiG GiG GiG GiG GiG GiG GiG GiG
ANS: G i G F PTS: G i G G i G 1
5. The same internal control objectives apply to manual and computer-based information systems.
GiG GiG GiG GiG GiG GiG GiG GiG GiG GiG GiG
ANS: G i G T PTS: G i G G i G 1
6. The external auditor is responsible for establishing and maintaining the internal control system.
GiG GiG GiG GiG GiG GiG GiG GiG GiG GiG GiG GiG
ANS: G i G F PTS: G i G G i G 1
7. Segregation of duties is an example of an internal control procedure.
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© GiG2016 GiGCengage GiGLearning®. G i G May GiGnot GiGbe GiGscanned, GiGcopied GiGor GiGduplicated GiGor GiGposted GiGto GiGa GiGpublicly GiGaccessible GiGwebsite, GiGin GiGwhole GiGor
GiGin GiG part, GiGexcept GiGfor GiG use GiGas GiGpermitted GiGin GiGa G i G license GiGdistributed GiGwith GiGa GiGcertain GiGproduct GiGor GiGservice GiGor GiGotherwise GiGon GiGa GiGpassword-
protected website or school-approved learning management system for classroom use.
, IT Auditing 4th Ed—Test Bank,
GiG GiG GiG GiG
Chapter 1
ANS: G i G T PTS: G i G G i G 1
8. Preventive controls are passive techniques designed to reduce fraud.
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ANS: G i G T PTS: G i G G i G 1
9. A key modifying assumption in internal control is that the internal control system is the
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responsibility of management.
GiG GiG GiG
ANS: G i G T PTS: G i G G i G 1
© GiG2016 GiGCengage GiGLearning®. G i G May GiGnot GiGbe GiGscanned, GiGcopied GiGor GiGduplicated GiGor GiGposted GiGto GiGa GiGpublicly GiGaccessible GiGwebsite, GiGin GiGwhole GiGor
GiGin GiG part, GiGexcept GiGfor GiG use GiGas GiGpermitted GiGin GiGa G i G license GiGdistributed GiGwith GiGa GiGcertain GiGproduct GiGor GiGservice GiGor GiGotherwise GiGon GiGa GiGpassword-
protected website or school-approved learning management system for classroom use.
, IT Auditing 4th Ed—Test Bank,
GiG GiG GiG GiG
Chapter 1
10. While the Sarbanes-Oxley Act prohibits auditors from providing non-accounting services to
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their audit clients, they are not prohibited from performing such services for non-audit
GiG GiG GiG GiG GiG GiG GiG GiG GiG GiG GiG GiG GiG
clients or privately held companies.
GiG GiG GiG GiG GiG
ANS: G i G T PTS: G i G G i G 1
11. The Sarbanes-Oxley Act requires the audit committee to hire and oversee the external auditors.
GiG GiG GiG GiG GiG GiG GiG GiG GiG GiG GiG GiG GiG
ANS: G i G T PTS: G i G G i G 1
12. Section 404 requires that corporate management (including the CEO) certify their
GiG GiG GiG GiG GiG GiG GiG GiG GiG GiG
organization‟s internal controls on a quarterly and annual basis.
GiG GiG GiG GiG GiG GiG GiG GiG GiG
ANS: G i G F PTS: G i G G i G 1
13. Section 302 requires the management of public companies to assess and formally
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report on the effectiveness of their organization‟s internal controls.
GiG GiG GiG GiG GiG GiG GiG GiG GiG
ANS: G i G F PTS: G i G G i G 1
14. Application controls apply to a wide range of exposures that threaten the integrity
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of all programs processed within the computer environment.
GiG GiG GiG GiG GiG GiG GiG GiG
ANS: G i G F PTS: G i G G i G 1
15. Advisory services is an emerging field that goes beyond the auditor‟s traditional attestation
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function.
GiG
ANS: G i G T PTS: G i G G i G 1
16. An IT auditor expresses an opinion on the fairness of the financial statements.
GiG GiG GiG GiG GiG GiG GiG GiG GiG GiG GiG GiG
ANS: G i G F PTS: G i G G i G 1
17. External auditing is an independent appraisal function established within an organization to
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examine and evaluate its activities as a service to the organization.
GiG GiG GiG GiG GiG GiG GiG GiG GiG GiG GiG
ANS: G i G F PTS: G i G G i G 1
18. External auditors can cooperate with and use evidence gathered by internal audit
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© GiG2016 GiGCengage GiGLearning®. G i G May GiGnot GiGbe GiGscanned, GiGcopied GiGor GiGduplicated GiGor GiGposted GiGto GiGa GiGpublicly GiGaccessible GiGwebsite, GiGin GiGwhole GiGor
GiGin GiG part, GiGexcept GiGfor GiG use GiGas GiGpermitted GiGin GiGa G i G license GiGdistributed GiGwith GiGa GiGcertain GiGproduct GiGor GiGservice GiGor GiGotherwise GiGon GiGa GiGpassword-
protected website or school-approved learning management system for classroom use.
, IT Auditing 4th Ed—Test Bank, GiG GiG GiG GiG
GiGdepartments that are organizationally independent and that Chapter
GiG GiG GiG report to
1 the Audit
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GiGCommittee of the Board of Directors.
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© GiG2016 GiGCengage GiGLearning®. G i G May GiGnot GiGbe GiGscanned, GiGcopied GiGor GiGduplicated GiGor GiGposted GiGto GiGa GiGpublicly GiGaccessible GiGwebsite, GiGin GiGwhole GiGor
GiGin GiG part, GiGexcept GiGfor GiG use GiGas GiGpermitted GiGin GiGa G i G license GiGdistributed GiGwith GiGa GiGcertain GiGproduct GiGor GiGservice GiGor GiGotherwise GiGon GiGa GiGpassword-
protected website or school-approved learning management system for classroom use.
