The Information Systems Audit Specialist on Your Audit Team Has

question 130

Multiple Choice

The information systems audit specialist on your audit team has indicated that the general controls over program changes are excellent for all application cycles. What impact does this have on your audit of sales invoice processing?

• A) Generalized audit software should be used to select a sample of sales transactions for control testing.
• B) Tests of controls should be omitted; only substantive tests may be conducted.
• C) There could be problems with the accuracy of calculations for sales taxes and goods and excise taxes.
• D) The auditor can place reliance on the program's performance of sales calculations.

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Definitions:

Present Value

The present evaluation of a future cash sum or series of cash receipts, factoring in a certain rate of return for discounting.

Interest Rate

The sum a lender charges a borrower to use assets, conveyed as a percentage of the principal's amount.

Present Value

The here and now valuation of a prospective future financial amount or series of cash flows, calculated with a certain return rate.

Future Value

The value of an investment at a specified date in the future, taking into account factors like interest rates and compound interest.