Information Technology Auditing 4th Edition By James A.Hall – Test Bank

Information Technology Auditing 4th Edition By James A.Hall – Test Bank

Chapter 5— Systems Development and Program Change Activities

TRUE/FALSE

1. The objective of systems planning is to link systems projects to the strategic objectives of the firm.

ANS: T PTS: 1

2. The Systems Development Life Cycle (SDLC) concept applies to specific applications and not to strategic systems planning.

ANS: F PTS: 1

3. An accountant’s responsibility in the SDLC is to ensure that the system applies proper accounting conventions and rules and possesses adequate control.

ANS: T PTS: 1

4. In the conceptual design phase of the Systems Development Life Cycle (SDLC), task force members are focused on selecting the new system design.

ANS: F PTS: 1

5. When determining the operational feasibility of a new system, the expected ease of transition from the old system to the new system should be considered.

ANS: T PTS: 1

6. One-time costs include operating and maintenance costs.

ANS: F PTS: 1

7. When preparing a cost-benefit analysis, design costs incurred in the systems planning, systems analysis and conceptual design phases of the Systems Development Life Cycle are relevant costs.

ANS: F PTS: 1

8. A tangible benefit can be measured and expressed in financial terms.

ANS: T PTS: 1

9. Instead of implementing an application in a single big-bang release, modern systems are delivered in parts continuously and quickly

ANS: T PTS: 1

10. When the nature of the project and the needs of the user permit, most organizations will seek a pre-coded commercial software package rather than develop a system in-house.

ANS: T PTS: 1

11. All of the steps in the Systems Development Life Cycle apply to software that is developed in-house and to commercial software.

ANS: F PTS: 1

12. During the detailed feasibility study of the project, the systems professional who proposed the project should be involved in performing the study.

ANS: F PTS: 1

13. Recurring costs include: hardware maintenance, software acquisition, software maintenance, insurance, supplies and personnel costs.

ANS: F PTS: 1

14. The payback method is often more useful than the net present value method for evaluating systems projects because the effective lives of information system tend to be short and shorter payback projects are often desirable.

ANS: T PTS: 1

15. Intangible benefits are not physical, but can be measured and expressed in financial terms.

ANS: F PTS: 1

16. Legal feasibility identifies conflicts between the proposed system and the company’s ability to discharge its legal responsibilities

ANS: T PTS: 1

17. Programs in their compiled state are very susceptible to the threat of unauthorized modification.

ANS: F PTS: 1

18. Maintenance access to systems increases the risk that logic will be corrupted either by the accident or intent to defraud.

ANS: T PTS: 1

19. Source program library controls should prevent and detect unauthorized access to application programs.

ANS: T PTS: 1

20. The user test and acceptance procedure is the last point at which the user can determine the system’s acceptability prior to it going into service.

ANS: T PTS: 1

MULTIPLE CHOICE

1. Which control is not associated with new systems development activities?

a.

reconciling program version numbers

b.

program testing

c.

user involvement

d.

internal audit participation

ANS: A PTS: 1

2. Which test of controls will provide evidence that the system as originally implemented was free from material errors and free from fraud? Review of the documentation indicates that

a.

a cost-benefit analysis was conducted

b.

the detailed design was an appropriate solution to the user’s problem

c.

tests were conducted at the individual module and total system levels prior to implementation

d.

problems detected during the conversion period were corrected in the maintenance phase

ANS: C PTS: 1

3. Routine maintenance activities require all of the following controls except

a.

documentation updates

b.

testing

c.

formal authorization

d.

internal audit approval

ANS: D PTS: 1

4. Which statement is correct?

a.

compiled programs are very susceptible to unauthorized modification

b.

the source program library stores application programs in source code form

c.

modifications are made to programs in machine code language

d.

the source program library management system increases operating efficiency

ANS: B PTS: 1

5. Which control ensures that production files cannot be accessed without specific permission?

a.

Database Management System

b.

Recovery Operations Function

c.

Source Program Library Management System

d.

Computer Services Function

ANS: C PTS: 1

6. Program testing

a.

involves individual modules only, not the full system

b.

requires creation of meaningful test data

c.

need not be repeated once the system is implemented

d.

is primarily concerned with usability

ANS: B PTS: 1

7. Which statement is not true?

a.

An audit objective for systems maintenance is to detect unauthorized access to application databases.

b.

An audit objective for systems maintenance is to ensure that applications are free from errors.

c.

An audit objective for systems maintenance is to verify that user requests for maintenance reconcile to program version numbers.

d.

An audit objective for systems maintenance is to ensure that the production libraries are protected from unauthorized access.

ANS: A PTS: 1

8. When the auditor reconciles the program version numbers, which audit objective is being tested?

a.

protect applications from unauthorized changes

b.

ensure applications are free from error

c.

protect production libraries from unauthorized access

d.

ensure incompatible functions have been identified and segregated

ANS: A PTS: 1

9. Which is not a level of a data flow diagram?

a.

conceptual level

b.

context level

c.

intermediate level

d.

elementary level

ANS: A PTS: 1

10. Which statement is not correct? The structured design approach

a.

is a top-down approach

b.

is documented by data flow diagrams and structure diagrams

c.

assembles reusable modules rather than creating systems from scratch

d.

starts with an abstract description of the system and redefines it to produce a more detailed description of the system

ANS: C PTS: 1

11. The benefits of the object-oriented approach to systems design include all of the following except

a.

this approach does not require input from accountants and auditors

b.

development time is reduced

c.

a standard module once tested does not have to be retested until changes are made

d.

system maintenance activities are simplified

ANS: A PTS: 1

12. Evaluators of the detailed feasibility study should not include

a.

the internal auditor

b.

the project manager

c.

a user representative

d.

the system designer

ANS: D PTS: 1

13. A cost-benefit analysis is a part of the detailed

a.

operational feasibility study

b.

schedule feasibility study

c.

legal feasibility study

d.

economic feasibility study

ANS: D PTS: 1

14. Examples of one-time costs include all of the following except

a.

hardware acquisition

b.

insurance

c.

site preparation

d.

programming

ANS: B PTS: 1

15. Examples of recurring costs include

a.

software acquisition

b.

data conversion

c.

personnel costs

d.

systems design

ANS: C PTS: 1

16. A commercial software system that is completely finished, tested, and ready for implementation is called a

a.

backbone system

b.

vendor-supported system

c.

benchmark system

d.

turnkey system

ANS: D PTS: 1

17. Which of the following is not an advantage of commercial software? Commercial software

a.

can be installed faster than a custom system

b.

can be easily modified to the user’s exact specifications

c.

is significantly less expensive than a system developed in-house

d.

is less likely to have errors than an equivalent system developed in-house

ANS: B PTS: 1

18. Which step is least likely to occur when choosing a commercial software package?

a.

a detailed review of the source code

b.

contact with user groups

c.

preparation of a request for proposal

d.

comparison of the results of a benchmark problem

ANS: A PTS: 1

19. The output of the detailed design phase of the Systems Development Life Cycle (SDLC) is a

a.

fully documented system report

b.

systems selection report

c.

detailed system design report

d.

systems analysis report

ANS: C PTS: 1

20. The detailed design report contains all of the following except

a.

input screen formats

b.

alternative conceptual designs

c.

report layouts

d.

process logic

ANS: B PTS: 1

21. System documentation is designed for all of the following groups except

a.

systems designers and programmers

b.

end users

c.

accountants

d.

all of the above require systems documentation

ANS: D PTS: 1

22. Which type of documentation shows the detailed relationship of input files, programs, and output files?

a.

structure diagrams

b.

overview diagram

c.

system flowchart

d.

program flowchart

ANS: C PTS: 1

23. Typical contents of a run manual include all of the following except

a.

run schedule

b.

logic flowchart

c.

file requirements

d.

explanation of error messages

ANS: B PTS: 1

24. Computer operators should have access to all of the following types of documentation except

a.

a list of users who receive output

b.

a program code listing

c.

a list of all master files used in the system

d.

a list of required hardware devices

ANS: B PTS: 1

25. Which task is not essential during a data conversion procedure?

a.

decomposing the system

b.

validating the database

c.

reconciliation of new and old databases

d.

backing up the original files

ANS: A PTS: 1

26. When converting to a new system, which cutover method is the most conservative?

a.

cold turkey cutover

b.

phased cutover

c.

parallel operation cutover

d.

data coupling cutover

ANS: C PTS: 1

27. Site preparation costs include all of the following except

a.

crane used to install equipment

b.

freight charges

c.

supplies

d.

reinforcement of the building floor

ANS: C PTS: 1

28. The testing of individual program modules is a part of

a.

software acquisition costs

b.

systems design costs

c.

data conversion costs

d.

programming costs

ANS: D PTS: 1

29. When implementing a new system, the costs associated with transferring data from one storage medium to another is an example of

a.

a recurring cost

b.

a data conversion cost

c.

a systems design cost

d.

a programming cost

ANS: B PTS: 1

30. An example of a tangible benefit is

a.

increased customer satisfaction

b.

more current information

c.

reduced inventories

d.

faster response to competitor actions

ANS: C PTS: 1

31. An example of an intangible benefit is

a.

expansion into other markets

b.

reduction in supplies and overhead

c.

more efficient operations

d.

reduced equipment maintenance

ANS: C PTS: 1

32. A tangible benefit

a.

can be measured and expressed in financial terms

b.

might increase revenues

c.

might decrease costs

d.

all of the above

ANS: D PTS: 1

33. Intangible benefits

a.

are easily measured

b.

are of relatively little importance in making information system decisions

c.

are sometimes estimated using customer satisfaction surveys

d.

when measured, do not lend themselves to manipulation

ANS: C PTS: 1

34. Which technique is least likely to be used to quantify intangible benefits?

a.

opinion surveys

b.

simulation models

c.

professional judgment

d.

review of accounting transaction data

ANS: D PTS: 1

35. The formal product of the systems evaluation and selection phase of the Systems Development Life Cycle is

a.

the report of systems analysis

b.

the systems selection report

c.

the detailed system design

d.

the systems plan

ANS: B PTS: 1