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CPA > BEC Custom 9 > Flashcards

BEC Custom 9 Flashcards

1
Q

Risk

A

possibility of loss or other unfavorable outcome that results from uncertainty inherent in future events

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2
Q

Business Risk

A
  • the broad, macro-risk a firm faces largely as a result of the relationship between the nature of the firm and the nature of its environment
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3
Q

Diversifiable risk (also Unsystematic or Firm-specific)

A
  • elements of risk that can be eliminated through diversification of investments
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4
Q

Non-diversifiable risk (Systematic or Market-related risk)

A
  • elements of risk that can’t be eliminated through diversification of investments
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5
Q

EBIT

A
  • earnings before interest and taxes

- measures the results of a firm’s operating activities, except debt financing

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6
Q

Financial risk

A
  • common shareholders’ risk that result from the use of debt financing and preferred stock which require payment before common shareholders receive a return on investment
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7
Q

Default risk

A

Risk that the issuer of a security will not be able to make future interest and/or principal payments; the risk that the issuer may default on its obligation

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8
Q

Interest rate risk

A
  • risk that increases in market rate of interest will decrease the value of outstanding debt
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9
Q

Inflationary (also purchasing power) risk

A
  • risk that a rise in general price levels (inflation) will result in a reduction in the purchasing power of a fixed sum of money
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10
Q

Liquidity (also Marketability) risk

A

Risk that an asset can’t be readily sold at fair value for cash

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11
Q

Political risk

A

Risk associated with operations in a foreign country that has different political, governmental, cultural, ethical, market structure, or other socio-political elements than a firm’s domestic market

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12
Q

What is the purpose of COBIT?

A
  • align IT and business goals/strategies
  • link business risks, control needs & IT
  • common language for users, auditors, management and business process owners in identifying risks and structuring controls
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13
Q

What are the basic elements of the COBIT framework?

A
  • IT resources
  • monitor and evaluate
  • deliver and support
  • acquire and implement
  • plan and organize
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14
Q

What is the COBIT focus?

A

IT controls and processes

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15
Q

What is the focus of COSO?

A

organizational controls and processes

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16
Q

What is the goal of a Enterprise Resource Planning System (ERP)?

A
  • to integrate management support, knowledge work support, and operational support into one system
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17
Q

Online Transaction Processing System (OLTP)

A
  • include core business functions - sales, production, purchasing, payroll, financial reporting, etc.
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18
Q

Online Analytical processing system (OLAP)

A
  • data warehouse and data mining capabilities within ERP
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19
Q

Infrastructure as a Service (IaaS)

A
  • access to virtual hardware

- e.g. Amazon Web Services & Carbonite

20
Q

Platform as a Service (PaaS)

A

Access operating system and related services including development

21
Q

Software as a Service (SaaS)

A

Access software

- e.g. Office 365, Google Docs

22
Q

Cold Site

A
  • off-site location with electrical and other physical requirements for processing
  • no equipment or files
  • 1-3 days start-up
  • Cheaper
23
Q

Warm Site

A
  • off-site location with similar computer hardware
  • does not include backed up data
  • more $
24
Q

Hot Site

A
  • completely equipped including data
  • near-immediate (within hours) operation
  • Big $$$
25
Q

Mirrored Site

A
  • fully redundant, fully staffed, fully equipped

- real-time replication of mission critical systems

26
Q

BRM

A

Business risk management

27
Q

BCP

A

Business continuity planning

28
Q

OCP

A

organizational continuity plan

- process of risk assessment, contingency planning, and long-term continuity maintenance

29
Q

BIA

A
  • business impact analysis

- risk analysis portion of BCP

30
Q

What are the three important functions of an information technology department?

A
  • development
  • admin and programming
  • operations
31
Q

Applications Development

A
  • create and maintain applications
  • for safety, done in a test environment
  • use “nonlive” copies of programs
  • when tested and approved, put into use “live”
  • duty = safeguarding (future) “assets”: application programs and systems in development
32
Q

Systems Analysts

A
  • analyze and design new systems
  • lead teams of programmers
  • partner with end users to define problems and solutions
33
Q

Application programmers

A
  • write application programs
34
Q

System administrators

A
  • duty = authorize events (access)
35
Q

System programmers

A
  • maintain operating systems and related hardware

- segregation of duties - must not have access to application programs or data files

36
Q

Data control clerk

A
  • control document flows; schedule batches for data entry and editing; reconcile control totals
37
Q

Computer operators

A
  • operate the mainframe computer

- load program and data files, run programs (execute transactions)

38
Q

File Librarian

A
  • maintain files and data that are not online in the file library
  • check files in and out to support scheduled jobs
39
Q

What are the four roles in the systems development life-cycle (SDLC)?

A
  • IT Steering Committee
  • Lead Systems Analyst
  • Systems Analysts & Application Programmers
  • End users
40
Q

IT Steering Committee

A
  • review, approve, and prioritize systems development proposals
  • include members from IT department and functional user areas
41
Q

Lead Systems Analyst

A
  • manages development team(s) and projects
  • direct contact with end users
  • usually responsible for developing overall programming logic and functionality
42
Q

Source Program Library Management System (SPLMS)

A
  • software and instructions for people
  • for new or changed programs, manages migration from application development test environment to production library
  • controls and validates program changes by comparing new to old code
43
Q

What are the 4 functions of the SPLMS?

A
  • store programs in the source program library
  • retrieve programs for updating and maintenance
  • delete obsolete programs
  • audit trail - document program changes
44
Q

System Documentation

A
  • overview of program, data files, processing logic, interactions with other programs and systems
  • may include requirements, architecture, and design
45
Q

Program Documentation

A
  • detailed descriptions of inputs, logic, and outputs

- includes program flowcharts, source code listings, record layouts

46
Q

Operator Documentation

A
  • also called “run manual”
  • how to load and execute programs and data
  • includes needed equipment, files, supplies, commands, and error messages

CPA (16 decks)

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