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ICAEW - CERTIFICATE LEVEL 1 - BUSINESS, TECHNOLOGY & FINANCE (2025) > Chapter 14 - Developments in Technology > Flashcards

Chapter 14 - Developments in Technology Flashcards

1
Q

What is cloud computing?

A

Cloud computing is the provision of some part of a computer system through the use of the internet, including services like software as a service (web browser), data storage, and infrastructure as a service.

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2
Q

What does SaaS stand for?

A

Software as a service (SaaS)allows users to connect to and use cloud-based apps over the Internet. Common examples are email, calendaring, and office tools (such as Microsoft Office 365). SaaS provides a complete software solution that you purchase on a pay-as-you-go basis from a cloud service provider.

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3
Q

What does IaaS stand for?

A

Infrastructure as a service (IaaS) is a cloud computing service model where a cloud services vendor provides computing resources such as storage, network, servers, and virtualization (which emulates computer hardware). This service frees users from maintaining their own data center, but they must install and maintain the operating system and application software.

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4
Q

s cloud computn public or private?

A

A cloud can be public or private. Public clouds sell services to anyone on the internet. A private cloud is only made available to those that have permission to access it.

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5
Q

What are the three distinct characteristics of cloud computing? 3

A
  1. It is sold on demand and billed by the minute or hour. 2. It is elastic, allowing users to access as much or as little as they want. 3. It is fully managed by the provider, requiring only a device and internet access.
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6
Q

What are the advantages of cloud computing over on-premise software?
A. Data is stored locally and accessible to one user.
B. Data is held centrally, making it accessible to many users and up-to-date.
C. Cloud providers handle backups.
D. Users are required to manage system updates themselves.

A

B and C.

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7
Q

What is the internet of things (IoT)?

A

IoT refers to the connection of computing devices to the internet, enabling them to share data with processors where it is turned into information.

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8
Q

Which of the following are examples of IoT devices?
A. Gas meters
B. Electricity meters
C. Heart monitoring equipment
D. Non-digital thermostats

A

A, B, and C.

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9
Q

What is a digital asset?

A

A digital asset is data or information created and stored digitally, forming a source of revenue for businesses. Examples include software, photos, videos, original music, and digital documents.

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10
Q

How can a digital asset be protected?

A

A digital asset may need encoding, encryption, or watermarking to trace its origin and protect it.

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11
Q

What is a centralised ledger?

A

A centralised ledger is managed by a single authority, such as a bank, which records transactions and maintains account statements.

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12
Q

What is a distributed ledger?

A

A distributed ledger is a decentralised system where all participants maintain their own records of transactions, making them public and safe from corruption or fraudulent manipulation.

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13
Q

What are the advantages of distributed ledgers?
A. Data is managed by a single entity.
B. Transactions are made public for inspection.
C. They are inherently safe from corruption and fraudulent manipulation.
D. They depend on blockchain technology for additional security.

A

B, C, and D.

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14
Q

What is blockchain technology?

A

Blockchain is a method of recording transactions using discrete blocks of data, linked together by hash values, making it nearly impossible to alter past records fraudulently.

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15
Q

What is a hash in blockchain?

A

A hash is a checksum generated by a one-way algorithm that uniquely represents data. It ensures data integrity, as any tampering alters the hash value.

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16
Q

What are the key steps in a blockchain process?
A. Each transaction is recorded in blocks of data.
B. Blocks are connected by their hash values.
C. The original data can be reconstituted from the hash.
D. Tampering with data breaks the chain of trust.

A

A, B, and D.

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17
Q

Why is blockchain ideal for digital wallets?

A

Blockchain ensures trust by allowing third parties to verify the integrity of transactions through the integrity of hash values.

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18
Q

What is an example of blockchain use beyond digital wallets?

A

Blockchain is used in voting records, where tampering can be detected through hash integrity checks.

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19
Q

Explain the steps in a blockchain 4

A

Blockchain is a method of recording transactions in such a way that it is nearly impossible to go back and change history to fraudulently make the records more favourable.
Here is a simplified example, at least enough to explain the concept:
* (1) Each transaction is recorded in discreet blocks of data. In the first block, we have the data ‘abcd’.
* (2) Added to the block is a type of checksum called a hash value. A hash is a one-way algorithm that produces a large number of seemingly random characters (e.g. 256) that can only be generated by the input data. It is not encryption, for the source data cannot be reconstituted. This is shown in purple.
* (3) The hash from the preceeding block is incorporated into the next block. Data is added to it (‘efgh’ in this case) and a new hash is calculated that includes both the original hash and the data. This is shown in orange.
* (4) Subsequent blocks are added, each incorporating the preceding block’s hash values. And so on.

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20
Q

What are cryptocurrencies?

A

Cryptocurrencies are digital tokens that allow users to trade with each other online. They are secured through cryptography and recorded on public ledgers using blockchain technology.

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21
Q

What is the primary use of cryptocurrencies?

A

Cryptocurrencies enable users to make online purchases and receive payments, acting as a form of secure digital money.

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22
Q

What are the risks associated with cryptocurrencies?
A. Cryptocurrencies are not volatile.
B. Online digital wallets can be hacked.
C. Cryptocurrencies are subject to market forces.
D. They provide opportunities for criminals to avoid money laundering regulations.

A

B, C, and D.
Cryptocurrencies ARE volatile.

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23
Q

Can a digital wallet be seized?

A

No

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24
Q

What is fintech?

A

Fintech refers to the use of technology by challenger banks and other entities to provide innovative financial services at a lower cost of operation.

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25
What are examples of fintech innovations? A. Crowdfunding - get comsumer to fund product you want to provide B. Peer-to-peer lending C. Traditional currency conversion D. Digital payment companies like Apple Pay E. Algorithmic stock trading
A, B, D, and E.
26
What is peer-to-peer lending?
Peer-to-peer lending is a fintech service where borrowers are directly matched with savers, bypassing traditional financial institutions.
27
What are cognitive technologies?
Cognitive technologies are advanced computing systems capable of taking over a wide range of jobs traditionally performed by humans.
28
What is artificial intelligence (AI)?
AI involves the creation and use of advanced computer systems to perform tasks that traditionally require human intelligence.
29
What is robotic process automation (RPA)?
RPA is the use of pre-programmed robots to perform tasks that would otherwise be manual, following 'if this, then that' instructions. Can only follow yes or no instruction can’t think for itself like AI does.
30
What are the three primary methods of machine learning? A. Supervised learning B. Unsupervised learning C. Prescriptive learning D. Reinforcement learning
A, B, and D.
31
What is machine learning? 1 What are the 3 primary methods? 3 What aspects of analytics are machine learning decisions based on? 2
Learning from large volumes of training data, without being explicitly programmed to do so. This is done through three primary methods:  Supervised learning uses labelled data to predict future outcomes.  Unsupervised learning analyses unlabelled data and finds its own patterns and insights. Useful for detecting unidentified patterns.  Reinforcement learning uses an agent that learns from feedback in an environment. The agent learns which actions achieve the best results and repeats these in future. Machine learning decisions are based on two aspects of analytics:  Prediction (predictive analytics) – anticipates what will happen based on patterns within data.  Prescription (prescriptive analytics) – recommends what to do in order to achieve an objective.
32
What is supervised learning?
Supervised learning uses labelled data to predict future outcomes.
33
What is unsupervised learning?
Unsupervised learning analyses unlabelled data to find patterns and insights, useful for detecting unidentified patterns. It spots for you what you have not spotted.
34
What is reinforcement learning?
Reinforcement learning uses an agent that learns from feedback in an environment, identifying actions that achieve the best results. e.g. ChatGPT
35
What are the types of analytics in machine learning? A. Predictive analytics B. Descriptive analytics C. Prescriptive analytics
A and C.
36
What is Prediction (predictive analytics) in relation to AI machine learning?
Prediction (predictive analytics) – anticipates what will happen based on patterns within data.
37
What is Prescription (prescriptive analytics) in relation to AI machine learning?
Prescription (prescriptive analytics) – recommends what to do in order to achieve an objective.
38
What does deep learning involve?
Deep learning processes data in a way that mimics the human brain.
39
What are some types of AI technologies? A. Natural Language Processing (NLP) B. Computer vision C. Speech recognition D. Generative AI
A, B, C, and D.
40
What is Natural Language Processing (NLP)?
helps machines process and analyse large amounts of natural language data, facilitating tasks such as translation, sentiment analysis, voice-activated services and chatbot responses.
41
What is Computer vision?
allows computers to get information from images, videos and other inputs.
42
What is Speech AI?
allows computers to communicate in human language.
43
What is Generative AI?
Generative AI is designed to create new content, such as images, text, audio, or video.
44
What are the risks associated with AI?
Risks include unauthorised access to sensitive information and AI hallucinations leading to errors in outputs. An accountant must be careful not to share sensitive financial information as this may be access by unauthorised individuals.
45
How does automation, machine learning, and intelligent systems impact accounting?
These technologies automate transaction-level accounting, maintaining ledgers, and preparing reconciliations, freeing accountants to focus on other areas.
46
What is the impact of more cognitively powerful systems on accounting?
Faster data processing and sharing by computers makes accounting quicker and more efficient.
47
What are the roles of accountants in system innovation and applications? A. Adopting new technologies independently B. Advising on the adoption and use of innovations C. Ensuring compliance with system updates
B.
48
What is triple entry bookkeeping?
These mean that every accounting transaction recorded by an entity is also posted to the public ledger.
49
What are examples of digital contracts and transactions? A. Self-verifying smart contracts B. Triple entry bookkeeping C. Localised ledger systems D. Distributed ledger technology
A, B, and D.
50
What do accountants need to consider when dealing with new types of data, information, and risk?
They must make sound judgments, such as: - Deciding which information to enter into technology-enabled tools. - Interpreting and communicating system outputs. - Assessing the usefulness of information for mitigating risks.
51
How do new types of goods and services impact accountants?
Accountants must advise clients and employers on accounting for items arising from new technologies, such as digital assets. e.g. business like uber, just eat
52
What does transparency in recording and sharing data enable?
It provides clarity about resources through improved recording of transactions using technologies like distributed ledgers.
53
How do audit analytics and intelligent systems impact auditing?
These systems enable continuous auditing of 100% of transactions and can be used in internal audits.
54
How do smart contracts influence auditing?
The audit of smart contracts can occur during their creation, before transactions are executed.
55
How do data analytics improve auditing?
Predictive analytics helps target risks and enhances the relevance of audits.
56
What role do software controls and data sets play in auditing?
Auditors validate controls within accounting software and interpret complex data sets.
57
What is the impact of distributed ledger technology on auditing?
It reduces the need for auditors to verify transactions and asset ownership, ensuring proper functioning of ledgers and systems.
58
How does regulation adapt to technological developments in auditing?
Audit regulations must evolve to accommodate advancements in technology.
59
How do new sources of data and information impact businesses? 4
They help improve understanding of customers by: - Studying customer behaviour to identify patterns/trends. - Analysing customer tastes and interests. - Understanding how customers use communication channels. - Identifying customer desires and preferences.
60
What are the benefits of system-generated data for businesses? A. Generating KPIs to monitor efficiency. B. Reducing reliance on internal data. C. Providing data on speed of data transfer to identify issues. D. Identifying slow-moving product lines. E. Benchmarking performance internally and externally.
A, C, D, and E.
61
What is a virtual supply chain?
A virtual supply chain uses technological links between an organisation and its supply chain partners to form large and complex supply chains through shared knowledge and collaboration, enabling cost-effective production.
62
How do opportunities for new products arise from technology development?
Technology allows businesses to create new products or services, like apps, and sell them globally at a relatively low cost.
63
How does technology remove barriers to entry for businesses?
Technology allows businesses to enter markets they previously could not, as seen with disruptors like Uber and Airbnb, which use digital platforms rather than owning physical assets.
64
What is Electronic Data Interchange (EDI)?
EDI is the replacement of physical copies of orders and invoices with electronic counterparts, allowing for processing without human intervention.
65
Define E-procurement
Electronic procurement, also known as e-procurement or supplier exchange, is the process of requisitioning, ordering and purchasing goods and services online. It is a business-to-business process.
66
How does e-procurement expand procurement capabilities?
E-procurement opens up the pool of potential suppliers by allowing requests for information to be sent digitally, sourcing from electronic catalogues.
67
What is the role of the Internet of Things (IoT) in procurement?
IoT can be used to track consignments through radio frequency identification tags (RFIDs).
68
How can big data and artificial intelligence support procurement processes? A. Track inventory levels manually B. Monitor and analyse the performance of the procurement department C. Identify inefficiencies in processes
B and C.
69
How does technology impact pricing strategies in marketing?
Prices can be set based on anticipated demand and programmed to increase or decrease depending on whether demand is being met, as seen in the airline industry.
70
What is an Executive Support System (ESS) or Executive information system (EIS)?
A sophisticated database that pools data from internal and external sources, making information available to senior managers in an easy-to-use form to help make strategic, unstructured decisions.
71
What is an example of ESS in the medical profession?
Hospital general managers use ESS to access data on bed usage, costs, procedures, and demographic trends to set priorities and decide levels of provision for future years.
72
What does a Management Information System (MIS) do?
Converts data from internal sources into information (e.g., summary reports, exception reports) to enable timely and effective decision-making. The MIS transforms data from underlying TPS into summarised files that are used as the basis for management reports. It: – Supports structured decisions at operational and management control levels – Is designed to report on existing operations – Has little analytical capability – Is relatively inflexible
73
What are the characteristics of MIS? A. Supports structured decisions at operational and management levels B. Flexible and highly analytical C. Designed to report on existing operations D. Relatively inflexible
A, C, and D.
74
How is MIS used in the medical profession?
Managers at clinics and hospitals use MIS to access information on resource availability, costs, and revenues to ensure care is provided within budget.
75
What is a Decision Support System (DSS)?
A system that combines data and analytical models to support semi-structured and unstructured decision-making.
76
How is DSS used in healthcare?
Clinical staff use DSS to analyse scans, blood test data, and patient histories to decide on treatments.
77
What does an Expert System do?
Captures human expertise in a specific domain to guide users by holding specialised data and rules for decision-making in given circumstances.
78
What is an example of an Expert System in healthcare?
NHS Direct triage services use Expert Systems to infer potential causes and recommend actions based on caller symptoms.
79
What is the function of Knowledge Work Systems (KWS)?
Facilitates the creation and integration of new knowledge into an organisation.
80
How are KWS used in the medical profession?
Clinical staff use KWS for teleconferencing, image sharing, and accessing online journals for diagnoses and knowledge sharing.
81
What do Office Automation Systems (OAS) do?
Increase productivity by automating tasks like correspondence and scheduling.
82
How are OAS applied in healthcare?
Patient appointment systems are automated, and menus and signage are prepared using graphic tools.
83
What is a Transaction Processing System (TPS)?
A system that records and processes routine transactions, such as sales order processing.
84
How is TPS used in healthcare?
Pharmacies use TPS to order and dispense stock.
85
What is obsolescence risk?
The risk that investments in technology become wasted as technology becomes outdated.
86
What steps can help mitigate obsolescence risk? A. Outsource the activity to transfer the risk to the outsourcer B. Invest in technologies with the capability to be updated C. Invest in technologies with a longer payback period D. Invest in technologies with a shorter payback period
A, B, and D.
87
What is inexplicability risk?
The risk arising from algorithms becoming so complex that humans cannot understand them, making it difficult to check and explain results.
88
Why is inexplicability risk concerning when machines make decisions?
Machines may make decisions that are clearly wrong and difficult to trace or justify.
89
What does the General Data Protection Regulation (GDPR) require?
Companies must use data only for its original intended purposes and avoid holding data longer than necessary.
90
How does artificial intelligence pose a risk to data protection?
Data-hungry AI processes may tempt companies to use data for unintended purposes or retain it longer than permitted.
91
What is the key challenge of automation risks?
As companies adopt machine learning and software robots, they require new skills to ensure processing occurs as expected.
92
What are some key ethical risks associated with heavy use of technology? A. If a machine makes a mistake, who is to blame? B. How can machines make ethical decisions? C. How to reduce automation costs?
A and B.
93
What is an automation risk?
Automation risks As companies move from human processed activities to those processed by software robots and machine learning, a new set of skills is required to ensure processing is taking place as expected.
94
What is an ethical risk?
There are some interesting ethical issues arising for businesses that make heavy use of technology:  If a machine makes a mistake, who is to blame?  How can machines make ethical decisions?
95
What is cyber risk?
Cyber risk refers to the risk of financial loss, disruption, or damage to the reputation of an organisation caused by failures in its information technology systems.
96
What are some ways cyber risk can materialise? A. Deliberate and unauthorised breaches of security B. Unintentional or accidental breaches of security C. Operational IT risks due to poor systems integrity D. Physical theft of company assets
A, B, and C. Such a risk could materialise in the following ways:  deliberate and unauthorised breaches of security to gain access to information systems for the purposes of espionage, extortion or embarrassment  unintentional or accidental breaches of security, which nevertheless may still constitute an exposure that needs to be addressed  operational IT risks due to poor systems integrity or other factors
97
What is hacking?
Hacking involves criminals gaining access to computer networks to steal, amend, or delete records.
98
What is phishing?
Phishing is the use of bogus emails to trick users into providing security information and personal details.
99
What is a file hijacker/ransomware?
It is when a user's files are hijacked and held to ransom.
100
What is a webcam manager?
A webcam manager involves a criminal taking control of a user's webcam.
101
What is keylogging?
Keylogging involves criminals recording what a user types on their keyboard.
102
What is a screenshot manager?
It involves taking screenshots of a user's computer screen without their permission.
103
What is a distributed denial of service (DDoS) attack?
A DDoS attack uses botnets to overwhelm a website with traffic, disrupting its online services.
104
What is an ad clicker?
An ad clicker redirects a user's computer to click a specific link.
105
Purpose of National Cyber Security Centre
The National Cyber Security Centre (part of the NCA) identified a number of actions that businesses can take to counter the threat of cyber-attacks with better cybersecurity.
106
Why is it important to report cyber-attacks and incidents?
Reporting cyber-attacks and incidents allows law enforcement agencies to investigate, improve their understanding, and shape future responses. It also ensures appropriate resourcing and funding.
107
What is cyber risk mitigation?
Cyber risk mitigation involves protecting an organisation from potential cyber risks by implementing strong cybersecurity measures to safeguard its operations, finances, and reputation.
108
How should organisations manage cybersecurity?
The level of cybersecurity management depends on the size of the organisation and its exposure to cyber risks. Small organisations focus on fundamentals, while larger ones aim for greater security depth.
109
Why should organisations promote awareness of cybersecurity?
Promoting cybersecurity awareness ensures employees and stakeholders follow best practices, such as setting strong passwords and using encryption methods.
110
What is the benefit of sharing knowledge and expertise about cybersecurity?
Sharing knowledge and expertise with other businesses and stakeholders helps all parties benefit from a broader understanding of cybersecurity practices.
111
How can organisations develop cyber skills and awareness?
Organisations can develop cyber skills and awareness by offering cybersecurity training programs for staff or hiring employees with strong cybersecurity skills.
112
What is cyber-resilience?
Cyber-resilience is the ability of an organisation to ensure that its data and information is reliable, available, has integrity, and is adequately protected from unauthorised access.
113
What measures can organisations take to increase cyber-resilience?
Organisations can increase cyber-resilience by implementing cybersecurity measures to protect against cyber-attacks, setting up disaster recovery procedures, and maintaining backups to replace lost data in a cyber-attack.
114
What are mobile threats in the context of cyber-resilience?
Mobile threats involve mobile devices containing information, data, and connections to an organisation's system being lost or stolen.
115
What are networking and cloud considerations in cyber-resilience?
Networking and cloud considerations include issues where broadband, wi-fi, and other network connections become unavailable, preventing remote or cloud access to the organisation’s systems or data.
116
What are access controls in the mobile world?
Access controls in the mobile world refer to situations where an organisation's main system is compromised due to inferior controls on mobile devices or third-party access.
117
What are other threats to cyber-resilience?
Other threats include attacks on company websites, social media, email, as well as threats like fire, hardware failure, and burglary that prevent access to company systems.
118
What is cybersecurity?
The protection of systems, networks, and data in cyberspace; procedures used by businesses to protect their information systems from damage, disruption, theft, or other loss.
119
Name three methods businesses can use to protect their information systems. 3
1. Understanding where all of its information is. 2. Separating systems from each other, with different levels of trust. 3. Implementing user rights and access.
120
What is the purpose of applying patches and updates?
To address specific weaknesses, limit the use of insecure devices, and enhance overall system security.
121
Why should businesses address third-party relationships?
Because they may be the source of a system weakness.
122
What is the role of ethical hackers in cybersecurity?
To test systems for conformance and check if they can be penetrated.
123
What is ISO 27001?
An information security standard based on controls to manage risk.
124
What does PCI-DSS stand for?
Payment Card Industry Data Security Standard. A standard applicable to the handling of debit and credit card payment data.
125
What is the NIST framework used for?
A US framework that incorporates risk-based standards for cybersecurity.
126
What is SOC for Cybersecurity?
A standard published by the American Institute of Certified Public Accountants for reporting opinions on cyber risk management.

ICAEW - CERTIFICATE LEVEL 1 - BUSINESS, TECHNOLOGY & FINANCE (2025) (14 decks)

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