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Please answer question 6-10

Based on the results of test of control, an auditor decides to increase the assessed level of control risk from that originally planned. To achiove an overall audit risk level that is substantially the same as the planned audit risk level, the auditor would (a) Increase inherent risk. (b) Increase materiality levels. (c) Decrease substantive testing (d) Decrease detection risk. A bank's automatic teller machine system (ATM) uses currency-dispensing machines to issue cash auto subsystems by data communication networks and databases. An important edit check in ATM is a validity check. A validity check tests: matically to customers. ATM involves the use of interconnecting (a) (b) (c) (d) Identification numbers or transaction codes against those known to be authorised The characters in a field to assure that they are of the class that the field is supposed to contain. A numerical amount in a record to assure that it does not exceed some predetermined amount. The logical correctness of relationships among the values of data items on an input record and a file record. (8) A source document with an invalid number of hours worked for one week, e.g. 93 hours instead of 39, would best be detected by: (a) Keypunching controls. (b) A limit test in an edit run. (c) Hash total of hours worked. (d) Record count total. (9) An auditor believes that there is substantial doubt about the ability of ABC Ltd to continue as a going concern for a reasonable period of time. In evaluating ABC Ltd's plans for dealing with the adverse effects of future conditions and events, the auditor would most likely consider, as a mitigating factor, ABC Ltd's plans to (a) Accelerate research and development projects related to future products. (b) Enhance the quality of existing product lines by investing in new (c) (d) manufacturing technology Purchase equipment and production facilities currently being leased. Negotiate reductions in interest rates on outstanding debt. Which of the following most likely represents a significant deficiency in the internal control? (10) (a) (b) (c) (d) The systems analyst reviews applications of data processing and maintains systems documentation The control clerk establishes control over data received by the IT department and reconciles control totals after processing The systems programmer designs systems for computerised applications and maintains output controls. The accounts payable clerk prepares data for computer processing and enters the data into the computer

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