IIA IIA-CIA-PART3 Online Practice Questions and Exam Preparation

IIA IIA-CIA-PART3 Online Questions & Answers

• Question 191:

  In the Boston Consulting Group (BCG) growth-share matrix, which strategic business units generate large amounts of cash, need heavy investment to grow and maintain competitive positioning, but usually have modest net cash flow?

  A. Cash cows.
  B. Question marks.
  C. Dogs.
  D. Stars.
  D. Stars.

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  Explanation

  A star is a business with a strong competitive position in a growth industry. It has a high relative market share, and the market growth rate is high. Thus, the industry is robust, and the SBU is highly attractive. Net cash flow is modest because investment is heavy, although stars generate large amounts of cash.

• Question 192:

  Organizational characteristics that may be barriers to effective communications include all of the following except:

  A. Organizational status differences.
  B. Lack of formal channels.
  C. Listening problems.
  D. Departmental needs and goals.
  C. Listening problems.

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  Explanation

  Listening problems are personal characteristics, not organizational characteristics that may cause communication problems.

• Question 193:

  An organization discovered fraudulent activity involving the employee time-tracking system. One employee regularly docked in and clocked out her co-worker friends on their days off, inflating their reported work hours and increasing their wages.

  Which of the following physical authentication devices would be most effective at disabling this fraudulent scheme?

  A. Face or finger recognition equipment,
  B. Radio-frequency identification chips to authenticate employees with cards.
  C. A requirement to clock in and clock out with a unique personal identification number.
  D. A combination of a smart card and a password to clock in and clock out.
  A. Face or finger recognition equipment,

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  Explanation

  Fraud in time-tracking systems --such as "buddy punching" (where one employee clocks in/out for another) --is a common payroll fraud scheme. The most effective method to prevent this is biometric authentication , which ensures that only the actual employee can clock in or out.

  (A)

  Face or finger recognition equipment.

  Correct. Biometric authentication (such as fingerprint or facial recognition) is the most effective solution because it uniquely identifies each individual, making it impossible for an employee to clock in on behalf of a colleague.

  IIA GTAG "Managing and Auditing IT Vulnerabilities" recommends biometric authentication as a strong fraud prevention measure.

  IIA Practice Guide "Fraud Prevention and Detection in an Automated Environment" highlights the use of biometrics for enhancing security in access control systems .

  (B)

  Radio-frequency identification (RFID) chips to authenticate employees with cards.

  Incorrect. RFID cards can be shared between employees, allowing fraud to continue. They are useful for access control but do not verify the identity of the person using the card.

  (C)

  A requirement to clock in and clock out with a unique personal identification number (PIN).

  Incorrect. PINs can be shared or stolen , making them ineffective in preventing buddy punching.

  (D)

  A combination of a smart card and a password to clock in and clock out.

  Incorrect. Like RFID and PIN systems, smart cards and passwords can be shared , making them ineffective against fraudulent time-tracking practices.

  IIA GTAG - ";Managing and Auditing IT Vulnerabilitie";

  IIA Practice Guide - "Fraud Prevention and Detection in an Automated Environmen";

  COSO Framework - Fraud Risk Management

  Analysis of Answer Choices:IIA References:Thus, the correct answer is A , as biometric authentication directly verifies the employee's identity, preventing time-tracking fraud.

• Question 194:

  An organization's balance sheet indicates that the total asset amount and the total capital stock amount remained unchanged from one year to the next, and no dividends were declared or paid. However, the organization reported a loss of $200,000. Which of the following describes the most likely year-over-year change to the organization's total liabilities and total stockholder equity?

  A. The total liabilities and total stockholder equity both increased.
  B. The total liabilities and total stockholder equity both decreased.
  C. The total liabilities decreased, and the total stockholder equity increased.
  D. The total liabilities increased, and the total stockholder equity decreased.
  D. The total liabilities increased, and the total stockholder equity decreased.

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  Explanation

• Question 195:

  Which of me following represents an inventory costing technique that can be manipulated by management to boost net income by selling units purchased at a low cost?

  A. First-in first-out method (FIFO)
  B. Last-in first-out method (LIFO)
  C. Specific identification method
  D. Average-cost method
  A. First-in first-out method (FIFO)

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  Explanation

• Question 196:

  Which one of the following is generally not beneficial to group decision making in an organization?

  A. More information.
  B. Acceptance.
  C. More knowledge.
  D. Dominant members.
  D. Dominant members.

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  Explanation

  Group decision making, such as by committee, works better when the committee is small and the members accept each other as contributing parts of the group. A dominant member is not desirable. The chair should act as a moderator and not be considered threatening or overbearing by the other members.

• Question 197:

  According to management literature, worker absenteeism, turnover, and error rates are likely to be greatest:

  A. When workers alternate in performing different jobs.
  B. In simplified assembly-line jobs.
  C. In job sharing situations.
  D. When flexible working hours are provided.
  B. In simplified assembly-line jobs.

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  Explanation

  The literature tends to support the theory that, while job satisfaction has an economic importance only indirectly related to productivity, satisfied workers exhibit lower rates of absenteeism, turnover, tardiness, apathy, and sabotage. Organizations with more organic or flexible organization structures may use more of the worker's skills and present a greater variety of work challenges, thus improving morale. Mass production technology usually involves repetitious, boring tasks.

• Question 198:

  A manufacturer is deciding whether to sell or process materials further. Which of the following costs would be relevant to this decision?

  A. Incremental processing costs, incremental revenue, and variable manufacturing expenses
  B. Joint costs, incremental processing costs, and variable manufacturing expenses
  C. Incremental revenue, joint costs, and incremental processing costs
  D. Variable manufacturing expenses, incremental revenue, and joint costs
  A. Incremental processing costs, incremental revenue, and variable manufacturing expenses

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  Explanation

• Question 199:

  An advantage of a direct investment strategy when entering a foreign market is

  A. Reduction in the capital at risk.
  B. Shared control and responsibility.
  C. Assurance of access when the foreign country imposes domestic content rules.
  D. Avoidance of interaction with the local bureaucracy.
  C. Assurance of access when the foreign country imposes domestic content rules.

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  Explanation

  Direct investment has many advantages:

  (1)

  cheaper materials or labor,

  (2)

  receipt of investment incentives from the host government, (3) a strong relationship with interested parties in the host country, (4) control of the investment, (5) a better image in the host country,

  (6)

  market access when domestic contest rules are in effect. However, direct investment is risky because of exposure to currency fluctuations, expropriation, potentially high exit barriers, and restraints on sending profits out of the country.

• Question 200:

  After performing an assessment of time worth, the manager of a corporation determined that the net benefit to the organization for performing a particular task is less than the manager's hourly worth to the organization.Which of the following statements is most true in relation to this situation?

  A. The manager should delegate this task to an assistant whose time is less costly.
  B. The manager should continue performing the task because there is no way to change this outcome.
  C. If the manager receives a salary raise, the gap between the net benefit and the manager's hourly worth will decrease.
  D. The manager should work more hours so that the manager's hourly worth increases.
  A. The manager should delegate this task to an assistant whose time is less costly.

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  Explanation

  A manager should calculate how much money (s)he costs the organization each year, including salary, office space, equipment, etc. After adding to that amount the annual expected profit to be generated by the manager, the total should be divided by the annual hours expected to be worked. The result is the manager's hourly worth to the organization. If the net benefit to the organization of the manager's performing a task is less than his/her hourly worth, it should be delegated to an assistant whose time is less costly.