Which of the following methods would an auditor most likely use to document a complex sales order process?

A. Develop a horizontal flowchart, with supporting documentation for key control points.

B. Create a critical path method chart, noting the processes involved for each step.

C. Perform a process review, assigning time and cost to each step of the process to develop a hierarchy flowchart.

D. Utilize a systems narrative, which can be updated during subsequent audits.

Five brand managers in a consumer products company met to determine how well certain promotions had performed. The data that they needed to analyze consisted of approximately 50 gigabytes of daily point-ofsale (POS) data for each month. The brand managers tried to download the POS data from the mainframe and import it into microcomputer spreadsheets for analysis. Their efforts were unsuccessful, most likely because of:

A. The complexity of the mainframe data structure and the large volume of data.

B. The difficulty of establishing access privileges for each subset of the mainframe data.

C. Inconsistencies in the mainframe data due to lack of integrity constraints on the data files.

D. Error-prone transmission links for downloading the data from the mainframe data files.

Which of the following is a preventive control for fraud?

A. Determining if the number of manually prepared disbursement checks is high.

B. Reconciling the purchase orders with the requisitions.

C. Verifying that new vendors appear on the vendor pre-approved list.

D. Conducting an inventory count of the warehouse.

According to IIA guidance, which of the following procedures would be least effective in managing the risk of payroll fraud?

A. The employee's name listed on organization's payroll is compared to the personnel records.

B. Payroll time sheets are reviewed and approved by the timekeeper before processing.

C. Employee access to the payroll database is deactivated immediately upon termination.

D. Changes to payroll are validated by the personnel department before being processed.

Which of the following should be the focus of the effect section of the preliminary observations document?

A. Residual risk.

B. Inherent risk.

C. Compensating controls.

D. Control activities.