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CMA Intermediate · Corporate Accounting and Auditing · Application of Technology in Audit and Audit Trail

Which of the following is a recognised risk that arises specifically from the increased use of IT in an entity's financial reporting environment?

Unauthorised changes to programs or master data that may go undetected are a recognised IT risk. IT does not automatically reduce transaction volumes, eliminate human error, or remove segregation of duties, which is usually enforced through user access rights.

  1. AReduced volume of transactions processed
  2. BUnauthorised changes to programs or master data that may go undetectedCorrect
  3. CElimination of all human errors in processing
  4. DComplete absence of segregation of duties

Explanation

IT environments bring risks such as unauthorised changes to programs or data and inappropriate access. Errors are not eliminated, volume does not necessarily fall, and segregation of duties is not automatically absent; it may just be implemented via access rights.

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