To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com ACCOUNTING INFORMATION SYSTEMS CONTROLS AND PROCESSES TURNER / WEICKGENANNT CHAPTER 6: IT Governance TEST BANK - CHAPTER - TRUE / FALSE IT governance is an issue for executives and top management Lower level managers and the board of directors are outsiders in the process In order to meets it obligation of corporate governance, the board of directors must oversee IT In order to match company strategy to IT systems, the company needs to have an IT governance committee and a formal process to select, design, and implement IT systems Either the IT governance or the system development life cycle are necessary in the strategic management of IT systems Once the system development life cycle has determined the priority it places on IT systems, the IT governance committee will manage the development, implementation, and use of the systems The IT governance committee should constantly assess the long-term strategy of the company and determine the type of IT systems to purchase, develop and use The systems development life cycle is responsible for the oversight and management of the IT governance committee Accounting software was often not available in the early days of computers which required that the organization would develop, program, and implement their in-house accounting software Once the systems development life cycle (SDLC) is complete, it is not necessary to restart the cycle unless something is brought to the attention of the IT governance committee to indicate that another cycle is required 10 It is likely that the IT governance committee will go back through the phases of the SDLC to design new and improved IT systems 11 In the modern IT environment, it is necessary for an organization to follow each of the steps in the SDLC in the order presented 12 The exact steps in the SDLC and/or their sequence are not as important as is the need to formalize and conduct those steps completely and consistently 13 The IT governance committee will be constantly monitoring the IT system to look for fraud and system abuse To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 14 If the operational feasibility determines that the operation will require new training of employees, then the proposed upgrade or modification should be rejected 15 The economic feasibility study would answer the question about whether the benefits of the proposed IT system outweigh the costs 16 When the IT governance committee uses both the strategic match and the feasibility study, they will be better able to prioritize proposed changes to the IT systems 17 When the IT governance committee has made the decision as to which IT upgrades and/or modifications are to made, their job is complete 18 Data collection in the system survey step of systems analysis involves documentation review only 19 The purpose of observation in the system survey is to enable the project team to gain an understanding of the processing steps within the system 20 During a documentation review, the team would examine only relevant documentation of the proposed upgrade or modification 21 In order to gain a complete understanding of the system under study, the project team should seek the opinions and thoughts of those who use the system in addition to observation and documentation review 22 The face-to-face nature of an interview is advantageous due to the fact that the interviewer can clear up any misunderstandings as they occur and can follow up with more questions, depending on the response of the interviewee 23 One advantage of the interview process is efficiency 24 One advantage to the use of questionnaires is that they can be answered anonymously, which allows the respondent to be more truthful without fear of negative consequences 25 The determination of user requirements is often discovered through the use of observation and documentation review 26 The analysis phase is the critical-thinking stage of systems analysis 27 IT and business process reengineering have mutually enhancing relationships The business processes should be supported by the IT capabilities 28 Business process reengineering takes place at the systems design stage of the SDLC 29 The last step of the systems analysis phase is to prepare a systems analysis report that will be delivered to the IT governance committee To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 30 The steps within the design phase of the SDLC is the same, whether the organization intends to purchase software or to design the software in-house 31 In general, purchased software is more costly but more reliable than software designed inhouse 32 While it is not necessary to hire a consulting firm, many organizations find that the special expertise of consulting firms is most beneficial in the design and implementation of accounting system software 33 When in the systems design phase and creating an in-house accounting software, the feasibility aspect is the same as in the systems planning stage 34 In general, designs that require more complex technology have a higher feasibility than designs with less complex technology 35 When a company is revising systems, there are intangible benefits that are difficult to estimate in dollars These intangible benefits should be included in the project team’s report 36 Because the users of reports need the reports on an ongoing basis as part of their jobs, it is critical to have user feedback in the design of the details of the output reports 37 In general, the manual input method is less error prone that the electronic methods 38 In the detailed design phase, all of the individual steps within a process must be identified and designed 39 The internal controls within a system must be designed in the implementation stage 40 It would not be necessary for the programming staff to have interaction with the accounting staff during the systems implementation process, as all systems design was previously completed 41 Software should never be implemented before it is tested 42 It is essential that accountants oversee the data conversion from the old system to the new system to make sure that all accounting data is completely and correctly converted 43 The file or database storage for the new accounting system may not be different from the old system 44 The longest and most costly part of the SDLC is the operation and maintenance 45 During the operation phase of the IT system, it is necessary that management receive regular reports that will enable management to determine whether IT is aligned with business strategy and meeting the objectives of the IT system To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 46 Once the SDLC has identified which types of IT systems are appropriate for the company, the IT governance committee becomes the mechanism to properly manage the development, acquisition, and implementation of the IT system 47 Each organization may approach IT governance in a different manner, but each organization should establish procedures for IT governance 48 The AICPA Trust Principles failed to include any reference to the internal control structure of the IT systems 49 Diligent adherence to the SDLC process, by management, is part of fulfilling its ethical obligations of stewardship and fraud prevention 50 As the result of the passage of the Sarbanes-Oxley Act, CPA firms have unlimited ability to provide non-audit services to their audit clients ANSWERS TO TEST BANK – CHAPTER – TRUE / FALSE: 10 F T T F F T F T F T 11 12 13 14 15 16 17 18 19 20 F T F F T T F F T F 21 22 23 24 25 26 27 28 29 30 T T F T F T T F T F 31 32 33 34 35 36 37 38 39 40 F T F F T T F T F F 41 42 43 44 45 46 47 48 49 50 T T F T T F T F T F TEST BANK - CHAPTER - MULTIPLE CHOICE 51 The process of determining the strategic vision for the organization, developing the long-term objectives, creating the strategies that will achieve the vision and objections, and implementing those strategies is referred to as A IT Governance B Strategic Governance C Strategic Management D IT Management 52 A structure of relationships and processes to direct and control the enterprise in order to achieve the enterprise’s goals by adding value while balancing risk versus return over IT and its processes is called: A IT Governance B Strategic Governance C Strategic Management D IT Management To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 53 To fulfill the management obligations that are an integral part of IT governance, management need not focus on: A Aligning IT strategy with the business strategy B Hiring an acceptable IT manager C Measuring IT’s performance D Insisting that an IT control framework be adopted and implemented 54 Which of the following is not one of the approaches used to achieve the management of an IT control framework? A Information Systems Audit and Control Association control objectives for IT B The International Organization for Standardization 17799, Code of Practice for Information Security Management C The Information Technology Infrastructure Library D Sarbanes-Oxley Act section on IT Controls 55 A group of senior managers selected to oversee the strategic management of IT is called: A IT Strategic Committee B IT Governance C Chief Information Officer (CIO) D IT Management 56 The formal process that many organizations use to select, design, and implement IT systems is the: A Systems Development Life Cycle B Control Objectives for IT C Practice for Security Management D Information Technology Development 57 The IT governance committee is made up of many different individuals within the organization Which of the following would not be one of those individuals? A Chief Information Officer B Chief External Auditor C Chief Executive Officer D Top Managers from User Departments 58 The evaluation of long-term, strategic objectives and prioritization of the IT systems in order to assist the organizations in achieving its objectives is called: A Systems Planning B Systems Analysis C Systems Design D Systems Implementation 59 The A B C D phases of the SDLC include all of the following except: Systems Planning Systems Implementation Systems Analysis Systems Purchasing To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 60 This phase of SDLC involves the planning and continuing oversight of the design, implementation, and use of the IT systems A Systems Analysis B Systems Implementation C Systems Planning D Systems Design 61 The study of the current system to determine the strengths and weaknesses and the user needs of that system is called: A Systems Analysis B Systems Design C Systems Planning D Systems Implementation 62 This phase of SDLC requires the collection of data about the system and the careful scrutiny of those data to determine areas of the system that can be improved A Systems Planning B Systems Implementation C Systems Analysis D Systems Purchasing 63 The creation of the system that meets user needs and incorporates the improvements identified by the systems analysis phase is called: A Systems Planning B Systems Design C Systems Analysis D Operation and Maintenance 64 The set of steps undertaken to program, test, and activate the IT system as designed in the system design phase is called: A Systems Planning B Systems Implementation C Systems Design D Systems Analysis 65 The regular, ongoing, functioning of the IT system and the processes to fix smaller problems, or bugs, in the IT system is called: A Systems Analysis B Systems Planning C Operation and Maintenance D Systems Implementation 66 During this phase of the SDLC, management should request and receive ongoing reports about the performance of the IT system A Operation and Maintenance B System Analysis C Systems Design D Systems Planning To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 67 The expanded SDLC presented in the textbook expands the processes within the system design phase This is necessary because: A It necessary for most companies to create their own software B The design phase needs to include the programming activities of self-created software C There is usually more than one software or system type that will meet the needs of the organization D Many organizations require a change in the type of operating system along with any changes in software 68 The Evaluation and Selection cycle of the expanded SDLC would not include which of the following steps? A Design or buy the system selected B Identify the alternative system approaches C Evaluate the fit of each of the alternatives to company needs D Implement the alternative selected 69 The process of matching alternatives system models to the needs identified in the system analysis phase is called: A Conceptual Design B Systems Analysis C Systems Planning D Evaluation and Selection 70 The process of assessing the feasibility and fit of each of the alternative conceptual approaches and selecting the one that best meets the organization’s needs is termed: A Conceptual Design B Evaluation and Selection C Systems Analysis D Systems Implementation 71 The process of designing the outputs, inputs, user interfaces, databases, manual procedures, security and controls, and documentation of the new system is referred to as: A Conceptual Design B Software Selection C Systems Design D Detailed Design 72 When attempting to prioritize IT projects, the IT governance committee needs to consider: A The assessment of IT systems and their match to strategic organizational objectives B The feasibility of each of the requested modifications or upgrades C Both of the above D None of the above To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 73 A company has stated that the main strategic objective is to improve the accounts payable function within the organization There are limited resources for IT upgrades and modifications The IT governance committee has received IT update requests from the public relations department, human services, and vendor satisfaction department Given this information, which would be the likely be the first upgrade implemented? A Public relations would be first because it would include all areas of the business - vendors, employees, and customers B Vendor satisfaction would be first because it would be most in line with the strategic objective of the company C Human services would be the first because the employees are the ones who are most affected by changes in the IT departments D It is not possible to make a decision without further information 74 The need to match IT systems to organizational objectives emphasizes the need for the IT governance committee to include top management as its members because: A These managers establish strategic objectives and are in the best position to assess the fit of the IT systems to those objectives B These managers are in a position to allocate resources and or time to the projects C Both of the above D None of the above 75 The realistic possibility of affording, implementing, and using the IT systems being considered is referred to as: A Feasibility B Rationality C Sequentiality D Ranking 76 The assessment of the realism of the possibility that technology exists to meet the need identified in the proposed change to the IT system is called: A Operational Feasibility B Economic Feasibility C Schedule Feasibility D Technical Feasibility 77 The assessment of the realism of the possibility that the current employees will be able to operate the proposed IT system is referred to as: A Operational Feasibility B Economic Feasibility C Schedule Feasibility D Technical Feasibility 78 The as: A B C D assessment of the costs and benefits associated with the proposed IT system is referred to Operational Feasibility Economic Feasibility Schedule Feasibility Technical Feasibility To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 79 The assessment of the realistic possibility that the proposed IT system can be implemented within a reasonable amount of time is called: A Operational Feasibility B Economic Feasibility C Schedule Feasibility D Technical Feasibility 80 Typical steps within the systems analysis phase of the SDLC would not include which of the following? A Preliminary Investigation B Survey of the Current System C Economic Feasibility D Determination of User Information Needs 81 The purpose of this step in the systems analysis phase is to determine whether the problem or deficiency in the current system really exists and to make a “go” or a “no-go” decision A Survey of the Current System B Determination of User Information Needs C Business Process Reengineering D Preliminary Investigation 82 A detailed study of the current system to identify weaknesses to improve upon and strengths that should be maintained is referred to as: A Preliminary Investigation B System Survey C Process Reengineering D Determination of User Information Needs 83 Watching the steps that employees take as they process transactions in the system is referred to as: A Investigation B Interrogation C Observation D Interview 84 The detailed examination of documentation that exists about the system to gain an understanding of the system under study is called a(n): A Documentation Review B Systems Audit C System Survey D Records Observation 85 Face-to-face, verbal questioning of users of an IT system to determine facts or beliefs about the system are called: A Interrogation B User Review C Interviews D System Survey To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 86 This type of question is designed such that the format and range of the answer is known ahead of time A Structured Question B Oral Question C Unstructured Question D Range Question 87 This type of question is completely open ended, and the respondent is free to answer in any way that he / she feels addresses the question A Structured Question B Oral Question C Unstructured Question D Range Question 88 A written, rather than an oral, form or questioning of users to determine facts or beliefs about a system is referred to as a(n): A Interview B Questionnaire C Interrogation D System Survey 89 The purpose of this phase is to question the current approaches in the system and to think about better ways to carry out the steps and processes of the system A Systems Analysis B Systems Survey C Analysis of Systems Survey D Preliminary Investigation 90 The fundamental rethinking and radical redesign of business processes to bring about dramatic improvements in performance is called: A Business Process Reengineering B Process Redesign C Business Analysis and Design D Business Process Design and Analysis 91 The many sets of activities within the organization performed to accomplish the functions necessary to continue the daily operations are referred to as: A Business Systems B Business Processes C Business Activities D Business Functions 92 The systems analysis report, which is sent to the IT governance committee, will inform the committee of all of the following, except: A The results of the systems survey B User needs determination C Detailed design D Recommendations regarding the continuation of the project To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 100 In this feasibility, the project team must estimate the total amount of time necessary to implement the each alternative design A Operational feasibility B Technical feasibility C Economic feasibility D Schedule feasibility 101 The purpose of this phase of systems design is to create the entire set of specifications necessary to build and implement the system A Detailed design B Evaluation and selection C Operational design D Detailed analysis 102 In the detailed design stage of systems design it is necessary that the various parts of the system be designed The parts of the system to be designed at this point would include all of the following, except: A Outputs B Inputs C Program Code D Data Storage 103 Reports and documents, such as income statements, aged accounts receivable reports, checks, and invoices are referred to as: A Outputs of the system B Data storage C Internal controls D Inputs of the system 104 The forms, documents, screens, or electronic means used to put data into the accounting system are called: A Outputs of the system B Data storage C Internal controls D Inputs of the system 105 Which of the following is not a method of data input? A Keying in data with a keyboard from data on a paper form B Electronic data interchange C Bar code scanning D Viewed on the screen 106 There are many different types of documentation necessary to operate and maintain an accounting system These types of documentation include all of the following, except: A Flowcharts B Operator Manuals C Output Examples D Entity Relationship Diagrams To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 107 A system conversion method in which the old and the new systems are operated simultaneously for a short time A Direct cutover conversion B Phase-in conversion C Pilot conversion D Parallel conversion 108 A system conversion method in which on a chosen date the old system operation is terminated and all processing begins on the new system A Direct cutover conversion B Phase-in conversion C Pilot conversion D Parallel conversion 109 A system conversion method in which the system is broken into modules, or parts, which are phased in incrementally and over a longer period A Direct cutover conversion B Phase-in conversion C Pilot conversion D Parallel conversion 110 A system conversion method in which the system is operated in only one or a few sub-units of the organization A Direct cutover conversion B Phase-in conversion C Pilot conversion D Parallel conversion 111 When the manager of the primary users of the system is satisfied with the system, an acceptance agreement will be signed, the enforcement of which makes it much more likely that project teams will seek user input and that the project team will work hard to meet user needs A System Conversion B Post-Implementation Acceptance C User Review D User Acceptance 112 A review of the feasibility assessments and other estimates made during the projects, the purpose of which is to help the organization learn from any mistakes that were made and help the company avoid those same errors in the future A System Design Life Cycle B Post-Implementation Review C User Acceptance D System Conversion Review To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 113 During the operation of an IT system, it is necessary that regular reports are received by management to monitor the performance of the system These reports would include all of the following, except: A IT Security and Number of Security Problems B IT Customer Satisfaction C Downtime of IT System D User Acceptance of the IT System 114 Which of the following is not a major purpose served by the continual and proper use of the IT governance committee and the SDLC? A The fulfillment of ethical obligations B The strategic management process of the organization C The conversion of the system D The internal control structure of the organization 115 The careful and responsible oversight and use by management of the assets entrusted to management is called: A IT Governance B Stewardship C Fiduciary Control D System Access 116 Employee Ethical considerations, related to IT governance, would include which of the following? A Maintain a set of processes and procedures that assure accurate and complete records B Confidentiality for those who serve on the project teams C Not to disclose proprietary information from the company to clients D Carefully consider the impact of system changes and to be ethical in the manner in which the changes are processed 117 When an organization hires consultants to assist with any phase or any phases of the SDLC, there are at least four ethical obligations Which of the following is not one of those obligations? A Bid the engagement fairly, and completely disclose the terms of potential cost increases B Bill time accurately to the client and not inflate time billed C Do not oversell unnecessary services or systems to the client D Make an honest effort to participate, learn the new system processes, and properly use the new system 118 Which of the following relationships would be allowed for a CPA firm? A Offering IT consulting services and completing the external audit B Completing the external audit and maintaining the bookkeeping work C Internal audit outsourcing and financial information systems design and implementation D Providing fairness opinions and completing the external audit To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com ANSWERS TO TEST BANK – CHAPTER – MULTIPLE CHOICE: 51 52 53 54 55 56 57 58 59 60 61 62 63 64 C A B D B A B A D C A C B B 65 66 67 68 69 70 71 72 73 74 75 76 77 78 C A C D A B D C B C A D A B 79 80 81 82 83 84 85 86 87 88 89 90 91 92 C C D B C A C A C B C A B C 93 94 95 96 97 98 99 100 101 102 103 104 105 106 B A D B C A C D A C A D D C 107 108 109 110 111 112 113 114 115 116 117 118 D A B C D B D C B B D C TEST BANK - CHAPTER – END OF CHAPTER QUESTIONS: 119 IT governance includes all but which of the following responsibilities? A Aligning IT strategy with the business strategy B Writing programming code for IT systems C Insisting that an IT control framework be adopted and implemented D Measuring IT’s performance 120 Which phase of the system development life cycle includes determining user needs of the IT system? A Systems planning B Systems analysis C Systems design D Systems implementation 121 Which of the following is not part of the system design phase of the SDLC? A Conceptual design B Evaluation and selection C Parallel operation D Detailed design 122 Which of the following feasibility aspects is an evaluation of whether the technology exists to meet the need identified in the proposed change to the IT system? A Technical feasibility B Operational feasibility C Economic feasibility D Schedule feasibility To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 123 The A B C D purpose of the feasibility study is to assist in Selecting software Designing internal controls Designing reports for the IT system Prioritizing IT requested changes 124 Within the systems analysis phase of the SDLC, which of the following data collection methods does not involve any feedback from users of the IT system? A Documentation review B Interviews using structured questions C Interviews using unstructured questions D Questionnaires 125 A request for proposal (RFP) is used during the A Phase-in period B Purchase of software C Feasibility study D In-house design 126 Which of the following steps within the systems implementation phase could not occur concurrently with other steps, but would occur at the end? A Employee training B Data conversion C Software programming D Post-implementation review 127 Each of the following are methods for implementing a new application system except: A Direct cutover B Parallel C Pilot D Test 128 A retail store chain is developing a new integrated computer system for sales and inventories in its store locations Which of the following implementation methods would involve the most risk? A Direct cutover B Phased-in implementation C Parallel running D Pilot testing 129 The use of the SDLC for IT system changes is important for several reasons Which of the following is not part of the purposes of the SDLC processes? A As a part of strategic management of the organization B As part of the internal control structure of the organization C As part of the audit of an IT system D As partial fulfillment of management’s ethical obligations To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 130 Confidentiality of information is an ethical consideration for which of the following party or parties? A Management B Employees C Consultants D All of the above ANSWERS TO TEST BANK - CHAPTER – END OF CHAPTER QUESTIONS 119 120 121 122 B B C A 123 124 125 126 D A B D 127 128 129 130 D A C D TEST BANK - CHAPTER – SHORT ANSWER QUESTIONS 131 At the beginning of the chapter, the real world example of Allstate’s IT expenditure is mentioned Prior to the implementation of their IT Governance Committee, "whoever spoke the loudest or whoever had the biggest checkbook," got to select IT Projects What you think the problems were with this kind of approach? Answer: There would be no long-term strategy in how they spent money on IT projects Therefore, it would be less likely that the company is buying and using the type of IT systems that support what the company wished to accomplish in the long-term 132 Why is it important that IT systems be aligned with the business strategy? Answer: IT systems are critical systems that support and enhance business processes and business strategy If the IT systems not support the business strategy, the company will find it much more difficult to achieve the long-term goals 133 Why would IT Governance include measuring the performance of IT Systems? Answer: IT Governance is the proper management of IT Without monitoring the performance of IT, there is no feedback to determine whether it is meeting the needs of the company, and meeting the objectives it was intended to achieve 134 What is the difference between technical feasibility and operational feasibility? Answer: Technical feasibility examines whether technology exists to accomplish the objectives in a proposed IT system Operational feasibility is an examination of whether the organization could operate the proposed IT systems, given the limitations of the personnel and resources within the company 135 How does the analysis of feasibilities in the Systems Planning help to prioritize system changes? Answer: A feasibility analysis may eliminate some proposed IT systems as not feasible Of those remaining under consideration, the feasibility analysis helps determine which proposed IT systems are most feasible Thus, those that are more feasible would have a higher priority and those that are less feasible have a lower priority To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 136 What is the advantage of studying the current system within the Systems Analysis phase? Answer: It is easier to determine how to improve the efficiency and effectiveness of a system if that system is well understood A study of the current system helps determine which areas need improvement 137 During the systems analysis phase, which two data collection methods help determine user requirements? Answers: Interviews and questionnaires both solicit information or opinions from users These methods allow users to have input in determining system requirements 138 What are the advantages of purchased software when compared to software developed inhouse? Answer: Purchased software is usually less costly, more reliable, and has a shorter implementation time 139 Why might it be important follow some or all of the SDLC phases for purchased software? Answer: Even when software is purchased, it often must be modified or customized The SDLC phases help organize and manage those steps to modify or customize the software 140 How is conceptual design different from detailed design? Answer: The detailed design is much later in the process and creates the entire set of specifications necessary to build and implement the system The conceptual design is earlier and is much more general in nature It establishes alternative conceptual designs 141 Within the System Design phase, what is the purpose of the Evaluation and Selection? Answer: The purpose is to assess the feasibility of each alternative conceptual design and to select the alternative design that best fits the organization’s needs 142 Which part of the System Design phase would include designing rows and columns of output reports? Why is it important to design reports? Answer: The detailed design part of system design includes creating the details of output reports Output reports include the information that users need to accomplish their jobs and without properly designed outputs, they cannot efficiently these jobs 143 What is the purpose of software testing? Answer: The purpose is to uncover problems in the system that would lead to erroneous accounting data 144 How are accountants involved in data conversion? Answer: Accountants should two things in data conversion The first is to oversee the data conversion to make sure all data are completely and accurately converted Accountants should also reconcile the converted data with the old data to insure it was accurately converted They would compare control totals of the old and converted data to accomplish the reconciliation 145 Why is a direct cutover conversion risky? Answer: It is risky because the old system is no longer in operation, and therefore, the old system cannot be used as a backup system in the event of errors or problems with the new system To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 146 Why is parallel conversion costly? Answer: It consumes more time and money because it requires running two systems at the same time 147 Why is user acceptance important? Answer: The project team is more likely to solicit and use feedback from users if they know that users must sign off on the new system In other words, the project team cannot say their job is finished until the user sign off occurs 148 Why is post-implementation review undertaken? Answer: It is undertaken to help those involved in the SDLC to learn from any mistakes they made during the process 149 How does the SDLC serve as an internal control? Answers: It is an internal control in the sense that it helps ensure that IT systems meet organizational needs and that the development and implementation of new IT systems is properly controlled 150 What ethical obligations employees have as IT systems are revised? Answer: Employees should make an honest effort to participate as requested in the SDLC, learn new system processes that result, and properly use the new systems and processes TEST BANK - CHAPTER – SHORT ESSAY 151 Describe the role that the Board of Directors should play in IT governance Answer: The board must oversee all aspects of IT in the organization They must articulate and communicate the direction for IT, stay aware of development, investments, and costs in IT They should receive and review reports on major IT projects and regular performance reports, and ensure that there are suitable resources and infrastructure available 152 Two feasibility studies occur during the SDLC; one during Systems Planning, and one during Systems Design Describe the differences between these two feasibility studies Answer: In the systems design phase, the feasibility study more detailed and the scope is different At this part of the system design phase, the alternative system conceptual designs have been narrowed to one alternative Thus, the feasibility study focuses on the details of that one design The estimates of the technology needed, the operational requirements, the costs, and the implementation schedule can be more precise In the systems planning phase, the purpose is to assess the feasibility of several alternative conceptual designs and to narrow the alternative conceptual designs 153 There are four methods of data collection used in the study of the current system; observation, documentation review, interviews, and questionnaires Compare and contrast these four methods Answer: In observation and documentation review, the project team views strengths and weaknesses of the system from their own perspective and they are not asking for user feedback Interviews and questionnaires are methods to ask for user input Interviews are face-to-face and verbal in the collection of user feedback Questionnaires can be anonymous and written Both interviews and questionnaires can be structured or unstructured To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 154 Describe the purpose of Business Process Reengineering during the System Design phase Answer: During the system design phase, the changes inherent in a new IT system may require changes in the underlying business processes BPR is as radical rethinking and redesign of a business process to take advantage of the speed and efficiency of computers BPR allows the company to make sure they are leveraging the capabilities of IT to improve the efficiency of the business processes 155 There are four methods of system conversion; parallel, direct cutover, pilot, and phase-in Describe these four methods and how they differ Answer: A parallel conversion is the operation of both the old system and the new system for a limited period of time A direct cutover occurs when the new system begins as of a certain date and the old system is discontinued on that same date In a pilot conversion, the new system is implemented in a subunit or subunits within the organization The old system would continue in other parts of the organization In a phase-in conversion, the new system is introduced in modules, rather than the entire system at once In comparing the four methods, the direct cutover is the most risky and the parallel is least risky The pilot and phase-in approaches may take a longer total time to achieve a conversion to the entire new system across the organization 156 Operation and maintenance is the longest and costliest part of the SDLC Describe why this would be true Answer: When a company has completed the SDLC and implemented a new system, the intent is to operate it for a few years to capture the benefits of the new system Therefore maintaining and operating the system may last for several years and therefore, be the most costly part also 157 Describe how IT performance reports are important in IT Governance Answer: Regular monitoring of the IT system is necessary to ensure that the system is meeting its objectives and performing as expected If management never received performance reports it would be difficult to know whether they needed to improve or revise the system 158 What is the underlying purpose of the restrictions on CPA firms in Section 201 of the Sarbanes Oxley Act? Answer: These restrictions are intended to increase the independence of CPA firms that provide audit services for companies The concern was that if a company receives fees from a client for consulting work, they may be less independent of the client’s wishes and more likely to allow clients to provide misleading accounting information to the investing public To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com TEST BANK - CHAPTER - PROBLEMS 159 Mega Corporation just became a public corporation when shares of stock were sold to the public three months ago A new board of directors has been appointed to govern the corporation Assume that you will be giving a presentation to the board on their responsibilities for IT systems Write a report that could be delivered to the board Answer: The board of directors of a company has a set of very important responsibilities related to IT systems As top management of the company, the board must take responsibility to ensure that the organization has processes that align IT systems to the strategies and objectives of the company To carry out this responsibility, the board must certain functions, or ensure there are processes to carry out the following functions: Align IT strategy with the business strategy Cascade strategy and goals down to lower levels of the organization Provide structures that facilitate implementation of strategy and goals Insist that an IT control framework be adopted and implemented Measure and review IT performance The more detailed activities needed to carry out these board responsibilities are as follows: * * * * Articulate and communicate long-term strategy Stay aware of latest developments in IT Insist that IT be a regular agenda item at board meetings Stay aware of the company’s investments, and competitors investments in IT * Ensure the senior IT official’s reporting level is appropriate to the role of IT * Ensure the board has a clear view of the risks and returns of current or proposed IT systems * Receive and review regular reports on the progress of IT projects, and on IT performance * Ensure adequate resources, skills, and infrastructures to meet strategic goals for IT systems If the board of directors focuses on these activities, it will help the board to ensure that IT systems support long-term strategic objectives of the company To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 160 Blutarch MultiMedia Stop is a regional retailer of consumer electronics with warehouses and stores located in several large cities in California The board and top management of Blutarch are considering updating their accounting, inventory, and retail sales software and hardware Their current systems are approximately 15 years old Assume that you have been hired as a consultant to guide them through the process of upgrading their systems Write a document that could be presented to the Board of Directors that summarizes the SDLC Answer: Memorandum To: Board of Directors From: Jennifer Starnes, IT Consultant Re: Systems Development Life Cycle This memo is intended to provide an executive summary on the System Development Life Cycle and the importance of it for your company IT systems are crucial to the success and profitability of Blutarch To enhance long-term performance, the company must choose and use the IT systems that best support the company’s goals and objectives To ensure you are selecting and using the most effective IT systems, you should follow a systematic and formal process to select, design, and implement IT systems A failure to follow a systematic and formal process in selecting and implementing IT systems is likely to lead to a mismatch between Blutarch strategic objectives and the capabilities of the IT systems One popular way of using a systematic and formal process is to follow a System Development Life Cycle (SDLC) method The SDLC is a set of systematic phases and steps to follow in selecting, designing, and implementing IT systems Given limited funds and time, following an SDLC process is a planned and controlled method of ensuring a proper match between Blutarch IT needs and the IT system implemented The phases of the SDLC are: systems planning; systems analysis; systems design; systems implementation; and operation and maintenance These phases occur in the sequence given as a planned and controlled approach to implementing new IT systems The following are brief descriptions of each of these phases Systems planning involves examining the long-term objectives of your company and based on these objectives, planning and prioritizing the type of IT systems that can help you achieve those objectives For example, if your company’s objective is to minimize inventory levels in your warehouses, you are likely to need IT systems that give you real-time and accurate information about inventory levels, and you are likely to need IT systems that help you predict or forecast sales of the various inventory items Systems analysis is the study of the current IT system to determine its strengths and weakness, and to get user feedback about the needs in a new IT system Systems design is the creation of the system that meets user needs as and improves the weaknesses of the old IT system In other words, the data collected and analyzed in the systems analysis phase will guide the design of the new IT system To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Answer to 160 (continued) Systems implementation is the set of steps undertaken to program, test, and activate the IT system that was designed during the systems design phase Operation and maintenance is the regular, ongoing functioning of the IT system and the process to fix smaller errors or problems in the IT system Following these phases, in this order, will help you to have IT systems that best match your company’s needs 161 Assume that you are the project team manager that is engaged in a Systems Analysis The company is a large, national retailer with several stores and warehouses located throughout the United States The corporate headquarters are in Atlanta, Georgia, and substantially all major accounting takes place at the corporate headquarters Describe how you would use the various data collection techniques of observation, documentation review, interviews, and questionnaires Answer: Observation and documentation review are both methods that allow a project team to better understand the IT system without soliciting input from users That is, these methods not interrupt the work of users, but they only uncover strengths and weaknesses in the IT system that are evident to the project team These two methods would be used at the corporate headquarters by the project team It may be necessary for the project team to also visit and observe at a couple of stores and a couple of warehouses However, it would not be necessary, or would it be cost effective, to visit all stores and all warehouses Interviews and questionnaires both solicit feedback from users Due to the number of stores and warehouses, it would be more effective to send surveys to these locations for certain users to complete At the corporate headquarters, it would be possible to use both interviews and questionnaires Because of the time consuming nature of interviews, they would be used on the smaller set of managers who use the IT system The questionnaires would be used to survey the larger group of users who are not managers To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 162 Ceemco is a small, privately owned manufacturing company in Cincinnati, Ohio Ceemco manufactures custom products as well as store display products to sell to other companies such as retailers Using an Internet search engine, a search using the search terms of Ceemco and Cincinnati Examine the kind of manufacturing the company does Once you have completed that, examine an accounting software site such as www.2020software.com or www.accountingsoftware411.com Complete the following: a Describe the process Ceemco should undertake to determine which accounting software might be the best fit for the company Answer: For a small company of this size, they are not likely to have an IT staff that could assist with an SDLC process to develop specifications for any software systems needed The more likely approach would be to hire a consulting firm to help select and install an accounting software system b Although you not know much about the company, develop a list of requirements you believe accounting software should have for Ceemco to consider the software as a viable alternative Answer: Since they produce many different categories of products (store displays, metal fabrication, plastic parts fabrication, medical case carts, HVAC products such as radiators, retail products such as window ornaments) they are very likely to have an extensive array of raw material inventories and the need to track many different types of work-in-process Therefore, the most critical need may be for manufacturing and inventory tracking modules The software would also need basic accounting modules such as accounts receivable, accounts payable, and general ledger It is not possible to determine whether they their own payroll or outsource payroll If they payroll in-house, they would need a payroll module They sell the windowornament products online, so there would be a need for an e-commerce module There is no mention of locations other than two in Cincinnati Therefore, they may have no need of a system that handles international currencies c Choose an accounting software from your Web search above and describe why you believe it is a good match for Ceemco Answer: There is no correct answers to this question, but there are some answers that would be incorrect For example, Quickbooks would not have the power necessary for this business Also, enterprise level systems such as SAP or Oracle would be too expensive for a company such as Ceemco Products such as MAS 200, MAS 500, Dynamics GP, or ACCPAC would be more appropriate To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 163 There are several approaches to applying an SDLC methodology to IT system change Using an Internet search engine, search for these terms: SDLC, waterfall, JAD (Joint Application Development), RAD (Rapid Application Development), Build and Fix, and Spiral Model For example, you might try entering these search terms: SDLC waterfall Write a brief definition of these various approaches to the System Development Life Cycle Answer: The student answer to this will vary depending on which web sites they use and when they access web sites A sample answer is provided The SDLC waterfall approach is the oldest approach to system development In a waterfall approach, there is a sequence of steps and the output of one sequence becomes the input for the next step The method described in this chapter is a waterfall approach Joint Application Development (JAD) is intended to reduce development time and to increase customer (end user) satisfaction with the system It is a method that involves a series of meetings with the end users or clients that will use the system These meetings with end users are called JAD sessions Rapid Application Development (RAD) usually involves object-oriented programming, a method that encourages the reuse of programmed modules RAD includes: 1) workshops or focus groups to gather requirements, 2) Protoyping, and testing off those prototypes, 3) Strict time limits on each development phase that delays immediate fixes and defers these improvements to the next prototype, and 4) Less formality in team communications The Build and Fix method is very open-ended and can be very risky The method does not have formal steps such as in the waterfall method In this method, a system is simply built (code is written) and then it is fixed until the customer is happy with it In the Spiral approach, an initial model of the system is developed and then successively refined with input from end users The development of each successive version of the system is undertaken using the carefully controlled steps in the SDLC waterfall approach In addition, after each development of each successive version, a risk assessment is undertaken to determine whether it is worthwhile to move to the next development version, or to stop The web sites used for this solution are: http://www.computerworld.com/developmenttopics/development/story/0,10801,71151,00.html http://www.startvbdotnet.com/sdlc/sdlc.aspx http://eproj.net/cgi-bin/pblog/index.php?entry=entry071106-131621 http://searchsoftwarequality.techtarget.com/sDefinition/0,,sid92_gci214246,00.html http://www.ctg.albany.edu/publications/reports/survey_of_sysdev/survey_of_sysdev.pdf http://www.garywwright.com/sdlc.php To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com 164 Trace Johnson is an accounting software consultant at Fipps and Associates Consulting Fipps is a value-added reseller of accounting software for mid-size companies Mid-size companies normally have revenue between 50 million to 500 million dollars One of Johnson’s responsibilities is to solicit new client companies, and to meet with management at these new clients so as to recommend the best accounting software system for the client Mid-market accounting software normally has several modules that the client may choose from For example, not all clients would need an e-business module for their accounting software, while other clients may need an e-business module Since part of Johnson’s compensation is a percentage of software sales and consulting revenue that he generates, what are the ethical conflicts he faces when soliciting new clients and recommending software and software modules? Answer: The nature of a consultant’s business can cause ethical issues to be raised This is true because there can be a conflict between what is best for the client and what is best for the consultant There are at least three important ethical traps that a consultant could easily fall into One is excessive billing of hours A second is recommending only software products that have a high profit margin for the consultant The third is recommending unnecessary modules All three of these ethical issues have a common thread In each of these situations, the consultant is trying to maximize his own wealth and is not putting the highest priority on the client’s needs A consultant could bill for extra hours not really worked for that client, or could inflate hours worked In both cases, the consultant is dishonest and unethical These fictitious billing acts are also fraudulent and illegal The other two ethical issues mentioned above are not as easily proven to be illegal, but they are unethical If a consultant feels two different software systems may meet the customers needs, but chooses the one with the higher profit margin solely fort the higher profit, he is acting unethically Also if a consultant recommends additional software modules not really needed by the client, he is acting unethically ... A Systems Planning B Systems Analysis C Systems Design D Systems Implementation 59 The A B C D phases of the SDLC include all of the following except: Systems Planning Systems Implementation Systems... IT system as designed in the system design phase is called: A Systems Planning B Systems Implementation C Systems Design D Systems Analysis 65 The regular, ongoing, functioning of the IT system. .. D All of the above ANSWERS TO TEST BANK - CHAPTER – END OF CHAPTER QUESTIONS 119 120 121 122 B B C A 123 124 125 126 D A B D 127 128 129 130 D A C D TEST BANK - CHAPTER – SHORT ANSWER QUESTIONS