AIS Exam 2025 With 100% Correct
Answers
Auditing - CORRECT ANSWER✔✔objectively obtaining and evaluating evidence regarding
assertions about economic actions and events to ascertain the degree of correspondence
between those assertions and established criteria
internal auditing - CORRECT ANSWER✔✔Assurance and consulting activity designed to add
value, improve organizational effectiveness and efficiency and accomplish organization
objectives
financial audit - CORRECT ANSWER✔✔examination of the reliability and integrity of financial
transactions, accounting records, and financial statements
information systems (internal control) audit - CORRECT ANSWER✔✔examination of the general
and application controls of an IS to assess its compliance with internal control policies and
procedures and its effectiveness in safeguarding assets
operational audit - CORRECT ANSWER✔✔examination of the economical and efficient use of
resources and the accomplishment of established goals and objectives
compliance audit - CORRECT ANSWER✔✔examination of organizational compliance with
applicable laws, regulations, policies and procedures
investigative audit - CORRECT ANSWER✔✔examination of incidents of possible fraud,
misappropriation of assets, waste and abuse or improper governmental activities
,inherent risk - CORRECT ANSWER✔✔susceptibility to significant control problems in the
absence of internal control
control risk - CORRECT ANSWER✔✔risk that a material misstatement will get through the
internal control structure and into the financial statements
detection risk - CORRECT ANSWER✔✔Risk that auditors and their audit procedures will fail to
detect a material error or misstatement
Confirmation - CORRECT ANSWER✔✔written communication with independent third parties to
confirm the accuracy of information such as customer account balances
reperformance - CORRECT ANSWER✔✔performing calculations again to verify qualitative
information
vouching - CORRECT ANSWER✔✔comparing accounting journal and ledger entries with
documentary evidence to verify that a transaction is valid, accurate, properly authorized and
correctly recorded
analytical review - CORRECT ANSWER✔✔examination of the relationships
4 Major Steps in the Auditing Process - CORRECT ANSWER✔✔Audit Planning, Collection of
Evidence, Evaluation of Evidence and Communication of Results
Types of Audits: - CORRECT ANSWER✔✔Financial, Information Systems, Internal Control,
Operational, Compliance, and Investigative
Financial Audit - CORRECT ANSWER✔✔Examines the reliability and integrity of financial
transactions, accounting records, and financial statements
, Information Systems Audit - CORRECT ANSWER✔✔Reviews the controls of an AIS to assess its
compliance with internal control policies and procedures and its effectiveness in safeguarding
assets. (done by experts - a narrow field of practice)
Risk-based Audit Approach - CORRECT ANSWER✔✔determine the threats, identify the controls,
evaluate the controls, for weak controls must increase testing or compensating controls
materiality - CORRECT ANSWER✔✔amount of an error, fraud or omission that would affect the
decision of a prudent user of financial information
reasonable assurance - CORRECT ANSWER✔✔obtaining complete assurance that information is
correct is prohibitively expensive, so auditors accept a reasonable degree of risk that the audit
conclusion is incorrect
systems review - CORRECT ANSWER✔✔an internal control evaluation step that determines if
necessary control procedures are actually in place
tests of controls - CORRECT ANSWER✔✔tests to determine whether existing controls work as
intended
compensating controls - CORRECT ANSWER✔✔control procedures that compensate for the
deficiency in other controls
source code comparison program - CORRECT ANSWER✔✔software that compares the current
version of a program with its source code; differences should have been properly authorized
and correctly incorporated
Answers
Auditing - CORRECT ANSWER✔✔objectively obtaining and evaluating evidence regarding
assertions about economic actions and events to ascertain the degree of correspondence
between those assertions and established criteria
internal auditing - CORRECT ANSWER✔✔Assurance and consulting activity designed to add
value, improve organizational effectiveness and efficiency and accomplish organization
objectives
financial audit - CORRECT ANSWER✔✔examination of the reliability and integrity of financial
transactions, accounting records, and financial statements
information systems (internal control) audit - CORRECT ANSWER✔✔examination of the general
and application controls of an IS to assess its compliance with internal control policies and
procedures and its effectiveness in safeguarding assets
operational audit - CORRECT ANSWER✔✔examination of the economical and efficient use of
resources and the accomplishment of established goals and objectives
compliance audit - CORRECT ANSWER✔✔examination of organizational compliance with
applicable laws, regulations, policies and procedures
investigative audit - CORRECT ANSWER✔✔examination of incidents of possible fraud,
misappropriation of assets, waste and abuse or improper governmental activities
,inherent risk - CORRECT ANSWER✔✔susceptibility to significant control problems in the
absence of internal control
control risk - CORRECT ANSWER✔✔risk that a material misstatement will get through the
internal control structure and into the financial statements
detection risk - CORRECT ANSWER✔✔Risk that auditors and their audit procedures will fail to
detect a material error or misstatement
Confirmation - CORRECT ANSWER✔✔written communication with independent third parties to
confirm the accuracy of information such as customer account balances
reperformance - CORRECT ANSWER✔✔performing calculations again to verify qualitative
information
vouching - CORRECT ANSWER✔✔comparing accounting journal and ledger entries with
documentary evidence to verify that a transaction is valid, accurate, properly authorized and
correctly recorded
analytical review - CORRECT ANSWER✔✔examination of the relationships
4 Major Steps in the Auditing Process - CORRECT ANSWER✔✔Audit Planning, Collection of
Evidence, Evaluation of Evidence and Communication of Results
Types of Audits: - CORRECT ANSWER✔✔Financial, Information Systems, Internal Control,
Operational, Compliance, and Investigative
Financial Audit - CORRECT ANSWER✔✔Examines the reliability and integrity of financial
transactions, accounting records, and financial statements
, Information Systems Audit - CORRECT ANSWER✔✔Reviews the controls of an AIS to assess its
compliance with internal control policies and procedures and its effectiveness in safeguarding
assets. (done by experts - a narrow field of practice)
Risk-based Audit Approach - CORRECT ANSWER✔✔determine the threats, identify the controls,
evaluate the controls, for weak controls must increase testing or compensating controls
materiality - CORRECT ANSWER✔✔amount of an error, fraud or omission that would affect the
decision of a prudent user of financial information
reasonable assurance - CORRECT ANSWER✔✔obtaining complete assurance that information is
correct is prohibitively expensive, so auditors accept a reasonable degree of risk that the audit
conclusion is incorrect
systems review - CORRECT ANSWER✔✔an internal control evaluation step that determines if
necessary control procedures are actually in place
tests of controls - CORRECT ANSWER✔✔tests to determine whether existing controls work as
intended
compensating controls - CORRECT ANSWER✔✔control procedures that compensate for the
deficiency in other controls
source code comparison program - CORRECT ANSWER✔✔software that compares the current
version of a program with its source code; differences should have been properly authorized
and correctly incorporated
