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Which of the following factors would increase the confidence level in a variables sampling plan?
Which of the following factors would increase the confidence level in a variables sampling plan? I. A larger sample size. II. A stratified sample. III. A larger standard deviation.A . I and II onlyB . I and III onlyC . II and III onlyD . I, II, and IIIView AnswerAnswer:...
Which of the following procedures would provide the best evidence of the effectiveness of a credit-granting function?
Which of the following procedures would provide the best evidence of the effectiveness of a credit-granting function?A . Observe the process.B . Review the trend in receivables write-offs.C . Ask the credit manager about the effectiveness of the function.D . Check for evidence of credit approval on a sample of...
If an auditor used nonstatistical sampling instead of statistical sampling to estimate the value of inventory, which of the following would be true?
If an auditor used nonstatistical sampling instead of statistical sampling to estimate the value of inventory, which of the following would be true?A . The confidence level could not be quantified.B . The precision would be larger.C . The projected value of inventory would be less reliable.D . The risk...
Which of the following should be considered outside the scope of this security audit engagement?
An internal auditor is assigned to conduct an audit of security for a local area network (LAN) in the finance department of the organization. Investment decisions, including the use of hedging strategies and financial derivatives, use data and financial models which run on the LAN. The LAN is also used...
Which of the following audit procedures would be most effective in determining the items to investigate?
A retail company uses a computer program that matches electronic vendor invoices with the applicable purchase orders and receiving information, which are also maintained electronically. If an invoice does not match the other items within predefined ranges, a report is generated and sent to the accounts payable department for further...
The most common motivation for management fraud is the existence of:
The most common motivation for management fraud is the existence of:A . Vices, such as a gambling habit.B . Job dissatisfaction.C . Financial pressures on the organization.D . The challenge of committing the perfect crime.View AnswerAnswer: C
Which of the following control procedures would be most effective in detecting fraud in such an environment?
Insurance companies often receive electronic hospitalization claims directly from hospitals. Which of the following control procedures would be most effective in detecting fraud in such an environment?A . Use integrated test facilities to test the accuracy of processing in a manner that is transparent to data processing.B . Develop monitoring...
Which of the following is most likely to explain the difference in the regional results?
A governmental auditor was assigned to determine reasons why the students in one region scored significantly higher on education evaluation tests than did the students in another region. Previous research showed that there is a direct correlation between public financial support and student results. Which of the following is most...
During an operational audit of a chain of pizza delivery stores, an auditor determined that cold pizzas were causing customer dissatisfaction. A review of oven calibration records for the last six months revealed that adjustments were made on over 40 percent of the ovens.
During an operational audit of a chain of pizza delivery stores, an auditor determined that cold pizzas were causing customer dissatisfaction. A review of oven calibration records for the last six months revealed that adjustments were made on over 40 percent of the ovens. Based on this, the auditor:A ....
Which of the following can be validly concluded from the auditor's statement?
An internal auditor provided the following statement about division A's performance during the month: "Because supplies of raw material X were scarce, division A's profits declined by 15 percent." Which of the following can be validly concluded from the auditor's statement? I. Division A's production level declined by 15 percent....
