Set 1

END–OF-SEMESTER EXAMINATION
SEMESTER I, 2009/2010 SESSION

KULLIYYAH OF ECONOMICS AND MANAGEMENT SCIENCES

Programme : Bachelor of Accounting Level of Study : Undergraduate

Time : 9:00am-12:00noon Date : 15.11.2009

Duration : 3Hr(s) 0 Min(s)

Course Code : ACC 4071 Section : 1-3

Course Title : Analysis & Design of Accounting Information Systems

(This Question Paper Consists of 9 Printed Pages with 2 Sections)

INSTRUCTION(S) TO CANDIDATES

DO NOT OPEN UNTIL YOU ARE ASKED TO DO SO

ANSWER ALL QUESTIONS

ANY FORM OF CHEATING OR ATTEMPT TO CHEAT IS A SERIOUS OFFENCE

WHICH MAY LEAD TO DISMISSAL

APPROVED BY:
 SECTION A: MULTIPLE CHOICE QUESTIONS

1. The task of searching the database to locate a stored record for processing is called
a. data deletion
b. data storage
c. data attribution
d. data retrieval

2. Which of the following is not a problem usually associated with the flat-file approach to
data management?
a. data redundancy
b. restricting access to data to the primary user
c. data storage
d. currency of information

3. Which characteristic is associated with the database approach to data management?

a. data sharing
b. multiple storage procedures
c. data redundancy
d. excessive storage costs

4. Entities are
a. nouns that are depicted by rectangles on an entity relationship diagram
b. data that describe the characteristics of properties of resources
c. associations among elements
d. sets of data needed to make a decision

5. Which of the following events would be least likely to be modeled in a REA diagram
a. customer inquires
b. posting accounts payable
c. receiving cash
d. sales to a customer

6. All of the following are examples of economic events except

a. receiving raw materials from a supplier
b. checking a customer’s credit prior to processing a sales order
c. disbursing cash for inventories received
d. shipping product to a customer

7. Which types of entities are included in REA diagrams?

a. support events
b. economic events
c. internal agents
d. all of the above

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 8. A cost-benefit analysis is a part of the detailed
a. operational feasibility study
b. schedule feasibility study
c. legal feasibility study
d. economic feasibility study

9. Examples of one-time costs include all of the following except

a. hardware acquisition
b. insurance
c. site preparation
d. programming

10. Which technique is least likely to be used to quantify intangible benefits?

a. opinion surveys
b. simulation models
c. professional judgment
d. review of accounting transaction data

11. The formal product of the systems evaluation and selection phase of the Systems
Development Life Cycle is
a. the report of systems analysis
b. the systems selection report
c. the detailed system design
d. the systems plan

12. All of the following are reasons why new systems fail except
a. the user is not involved in the development of the system
b. system requirements are not clearly specified
c. systems analysts rely on prototyping models
d. system development techniques are ineffective

13. The systems steering committee is responsible for all of the following except
a. assigning priorities
b. determining whether and when to terminate systems projects
c. analyzing the technical feasibility of the project
d. budgeting funds for systems development

14. The accountant’s role in systems analysis includes all of the following except
a. specify audit trail requirements
b. prepare data gathering questionnaires
c. suggest inclusion of advanced audit features
d. ensure mandated procedures are part of the design

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15. A commercial software system that is completely finished, tested, and ready for
implementation is called a
a. backbone system
b. vendor-supported system
c. benchmark system
d. turnkey system

16. Which statement is not true? A systems design walkthrough

a. is conducted by a quality assurance group
b. occurs just after system implementation
c. simulates the operation of the system in order to uncover errors and omissions
d. reduces costs by reducing the amount of reprogramming

17. Which of the following is NOT a requirement in management’s report on the

effectiveness of internal controls over financial reporting?
a. A statement of management’s responsibility for establishing and maintaining
adequate internal control user satisfaction.
b. A statement that the organizations internal auditors has issued an attestation report
on management’s assessment of the companies internal controls.
c. A statement identifying the framework used by management to conduct their
assessment of internal controls.
d. An explicit written conclusion as to the effectiveness of internal control over
financial reporting.

18. In a computer-based information system, which of the following duties needs to be

separated?
a. program coding from program operations
b. program operations from program maintenance
c. program maintenance from program coding
d. all of the above duties should be separated

19. Which of the following is not an essential feature of a disaster recovery plan?
a. off-site storage of backups
b. computer services function
c. second site backup
d. critical applications identified

20. Control risk is

a. the probability that the auditor will render an unqualified opinion on financial
statements that are materially misstated
b. associated with the unique characteristics of the business or industry of the client
c. the likelihood that the control structure is flawed because controls are either absent
or inadequate to prevent or detect errors in the accounts
d. the risk that auditors are willing to take that errors not detected or prevented by the
control structure will also not be detected by the auditor

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21. Which of the following is not an access control in a database system?
a. antivirus software
b. database authorization table
c. passwords
d. voice prints

22. All of the following tests of controls will provide evidence that access to the data files is
limited except
a. inspecting biometric controls
b. reconciling program version numbers
c. comparing job descriptions with access privileges stored in the authority table
d. attempting to retrieve unauthorized data via inference queries

23. Which control is not associated with new systems development activities?
a. reconciling program version numbers
b. program testing
c. user involvement
d. internal audit participation

24. Routine maintenance activities require all of the following controls except
a. documentation updates
b. testing
c. formal authorization
d. internal audit approval

25. Which of the following is correct?

a. check digits should be used for all data codes
b. check digits are always placed at the end of a data code
c. check digits do not affect processing efficiency
d. check digits are designed to detect transcription and transposition errors

[Total: 25 marks]

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 SECTION B: SHORT QUESTIONS / PROBLEMS

Question 1

a. What do the letters ‘R,’ ‘E,’ and ‘A’ stand for in the term “REA model”?
[3 marks]

b. What are support events?

[2 marks]

c. Define resources, economic events, and agents.

[3 marks]

d. Why would a company adopt the REA approach to database design?

[3 marks]

e. List and explain the steps involved in preparing an REA model of a business process.
[4 marks]

[Total: 15 marks]

Question 2

a. List at least three one-time costs and three recurring costs in system development.
[3 marks]

b. Explain the five stages of the systems development life cycle?

[5 marks]

c. What is prototyping? Why is it used in systems development?

[3 marks]

d. What is the purpose of the Request for Proposal (RFP)?

[4 marks]

[Total: 15 marks]

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 Question 3

a. The object oriented design approach is to build information systems from usable standard
objects. It has three elements namely objects, attributes and methods or operations.
Complete the figure 3(a) below with attributes and methods (operations) for Accounts
Receivable object.
[5 marks]

Attributes

Object Accounts
Receivable

Operations

Figure 3(a): Characteristics of the Accounts Receivable

b. Give two examples of system outputs for the following systems.

[5 marks]
System Output
Expenditure cycle 1……………………..
2……………………..
Conversion cycle 1……………………..
2……………………..
Revenue cycle 1……………………..
2……………………..

[Total: 10 marks]

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 Question 4

a. Internal control in a computerized environment can be divided into two broad categories.
What are they? Explain each.
[4 marks]

b. There are many techniques for breaching operating system controls. Discuss five.
[5 marks]

c. Define each of the following input controls and give an example of how they may be
used:
1. Missing data check
2. Numeric/alphabetic data check
3. Limit check
4. Range check
5. Reasonableness check
6. Validity check

[6 marks]

[Total: 15 marks]

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 Question 5 – Short Case

The following is a purchasing process and cash disbursement for MITRO Company. The
purchasing agent, AZMAN monitors the inventory and decides when more sugar supplies
are needed. AZMAN begins the purchasing process by manually preparing two hard
copies of a purchase requisition (PR) form. Then, he selects a supplier and enters the PR
information into a computer terminal in the department. The computer terminal generates
three hard copies of a purchase order (PO). One copy is sent to the supplier, one copy is
sent to the Accounts Payable (AP) Department and the third copy is filed in the
Purchasing Department. Once AZMAN has entered the PR into the computer terminal, he
files one copy of the PR and sends the other copy to AP. When the goods are received,
the Receiving Department verifies them using the packing slip, which is attached to the
goods. The goods are verified and sent to the warehouse for storage. JULIA, the
receiving clerk then updates the inventory and posts to the general ledger from a terminal
in the department.

HAIZA, the AP clerk receives the supplier’s invoice and reconciles it with the PR and
PO. Then the she posts the liability to the purchases journal and voucher register. Each
day, HAIZA visually searches the voucher register file from her terminal for open
invoices that are due to be paid. She then prepares the check. From a computer terminal,
she updates the check register and voucher register and post to the general ledger. The
check is mailed to the vendor. The PR, invoice, and PO are then filed in a closed voucher
file.

Required:

a. Prepare the REA model of the above procedure.

[10 marks]

b. In your REA model, show the cardinalities for all the associations.
[5 marks]

e. Construct a UML Use Case Diagram to model the situation above.

[5 marks]

[Total: 20 marks]

END OF QUESTION PAPER