An organization is considering outsourcing its IT services, and the internal auditor is assessing the related risks. The auditor grouped the related risks into three categories:
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Risks specific to the organization itself.
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Risks specific to the service provider.
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Risks shared by both the organization and the service provider.
Which of the following risks should the auditor classify as specific to the service provider?
A. Unexpected increases in outsourcing costs.
B. Loss of data privacy.
C. Inadequate staffing.
D. Violation of contractual terms.
While conducting audit procedures at the organization's data center, an internal auditor noticed the following:
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Backup media was located on data center shelves.
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Backup media was organized by date.
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Backup schedule was one week in duration.
-The system administrator was able to present restore logs.
Which of the following is reasonable for the internal auditor to conclude?
A. Backup media is not properly stored, as the storage facility should be off-site.
B. Backup procedures are adequate and appropriate according to best practices.
C. Backup media is not properly indexed, as backup media should be indexed by system, not date.
D. Backup schedule is not sufficient, as full backup should be conducted daily.
An organization suffered significant damage to its local file and application servers as a result of a hurricane. Fortunately, the organization was able to recover all information backed up by its overseas third-party contractor.
Which of the following approaches has been used by the organization?
A. Application management.
B. Data center management.
C. Managed security services.
D. Systems integration.
The management of working capital is most crucial for which of the following aspects of business?
A. Liquidity.
B. Profitability.
C. Solvency.
D. Efficiency.
Which of the following types of budgets will best provide the basis for evaluating the organization's performance?
A. Cash budget.
B. Budgeted balance sheet.
C. Selling and administrative expense budget.
D. Budgeted income statement.
An organization's board of directors is particularly focused on positioning the organization as a leader in the industry and beating the competition.
Which of the following strategies offers the greatest alignment with the board's focus?
A. Divesting product lines expected to have negative profitability.
B. Increasing the diversity of strategic business units.
C. Increasing investment in research and development for a new product.
D. Relocating the organization's manufacturing to another country.
Which of the following performance measures disincentivizes engaging in earnings management?
A. Linking performance to profitability measures such as return on investment.
B. Linking performance to the stock price.
C. Linking performance to quotas such as units produced.
D. Linking performance to nonfinancial measures such as customer satisfaction and employees training.
Which of the following is a characteristic of big data?
A. Big data is often structured.
B. Big data analytic results often need to be visualized.
C. Big data is often generated slowly and is highly variable.
D. Big data comes from internal sources kept in data warehouses.
Senior management is trying to decide whether to use the direct write-off or allowance method for recording bad debt on accounts receivables.
Which of the following would be the best argument for using the direct write-off method?
A. It is useful when losses are considered insignificant.
B. It provides a better alignment with revenue.
C. It is the preferred method according to The IIA.
D. It states receivables at net realizable value on the balance sheet.
An organization allows employees to use mobile devices for business purposes.
Which of the following could cause decreased employee productivity in case of data loss?
A. Malware resulting in data leakage.
B. Exposure of sensitive data.
C. Lack of data encryption.
D. Lack of data back up.
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