ARM 400 ACTUAL STUDY GUIDE QUESTIONS AND
ANSWERS SET A+
✔✔All of the following are mechanisms to align manager and shareholder interests,
EXCEPT - ✔✔Expansion and growth
✔✔As a category of agency costs, bonding costs include - ✔✔Stock options and
restricted stock
✔✔One example of a bonding cost, as it relates to separation of ownership and control
in a corporation, is a manager's - ✔✔Willingness to accept non-cash compensation that
links the manager's compensation to the corporation's performance
✔✔Corporate governance is defined as - ✔✔The mechanisms and procedures that
determine how corporations are run
✔✔The fees paid to external auditors to verify the corporations financial statements are
an example of - ✔✔A monitoring cost
✔✔Though various parties incur costs in monitoring corporate decision-makers, most
monitoring costs are shouldered by which one of the following? - ✔✔Shareholders
✔✔The data quality principle of reasonability refers to - ✔✔The materiality or relevance
of data
✔✔Which one of the following statements is correct regarding the personal data and
privacy positions of the European Union (EU) and the U.S.? - ✔✔The EU has one all-
encompassing data protection framework and the U.S. has several more targeted
privacy laws
, ✔✔Which one of the following is a basic process in any data security program? -
✔✔Develop and enforce stronger password protocols.
✔✔Which one of the following is a data governance committee (DGC) responsibility? -
✔✔A data governance committee ensures there are few conflicts or redundancies in
data standards and practices
✔✔A data governance committee (DGC) - ✔✔Is cross-functional
✔✔Which one of the following defines the duties of a data steward? - ✔✔A data
steward is an experienced business analyst
✔✔In terms of data governance, IT employees hold the role of - ✔✔Data custodians
✔✔To gain a competitive advantage, maintain profitability, and satisfy customers an
organization must - ✔✔Be able to trust its data.
✔✔Which one of the following is an example of a data governance tool? - ✔✔external
policy
✔✔Which one of the following data governance tools allows the data governance
committee to look at data relationships and interdependencies across the organization?
- ✔✔Enterprise data models
✔✔Ensuring quality data requires a - ✔✔Systematic and purpose-driven review process
✔✔Which one of the following defines the duties of a data steward? - ✔✔A data
steward is an experienced business analyst
✔✔Which one of the following provides the frame of reference needed so data can be
used appropriately for analysis and decision-making? - ✔✔Metadata
✔✔Under the General Data Protection Regulation (GDPR), a data controller's role is to -
✔✔Define how and for what purpose personal data should be processed
✔✔The Auditing Standard No. 5 (AS 5) calls for a specific fraud assessment because -
✔✔The failure to prevent or detect fraudulent misstatements is higher than the risk of
failing to prevent or detect other types of errors
✔✔One internal control integrated framework consists of five essential components: the
control environment, risk assessment, control activities, information and communication,
and monitoring activities. When these components are applied across the organization,
ANSWERS SET A+
✔✔All of the following are mechanisms to align manager and shareholder interests,
EXCEPT - ✔✔Expansion and growth
✔✔As a category of agency costs, bonding costs include - ✔✔Stock options and
restricted stock
✔✔One example of a bonding cost, as it relates to separation of ownership and control
in a corporation, is a manager's - ✔✔Willingness to accept non-cash compensation that
links the manager's compensation to the corporation's performance
✔✔Corporate governance is defined as - ✔✔The mechanisms and procedures that
determine how corporations are run
✔✔The fees paid to external auditors to verify the corporations financial statements are
an example of - ✔✔A monitoring cost
✔✔Though various parties incur costs in monitoring corporate decision-makers, most
monitoring costs are shouldered by which one of the following? - ✔✔Shareholders
✔✔The data quality principle of reasonability refers to - ✔✔The materiality or relevance
of data
✔✔Which one of the following statements is correct regarding the personal data and
privacy positions of the European Union (EU) and the U.S.? - ✔✔The EU has one all-
encompassing data protection framework and the U.S. has several more targeted
privacy laws
, ✔✔Which one of the following is a basic process in any data security program? -
✔✔Develop and enforce stronger password protocols.
✔✔Which one of the following is a data governance committee (DGC) responsibility? -
✔✔A data governance committee ensures there are few conflicts or redundancies in
data standards and practices
✔✔A data governance committee (DGC) - ✔✔Is cross-functional
✔✔Which one of the following defines the duties of a data steward? - ✔✔A data
steward is an experienced business analyst
✔✔In terms of data governance, IT employees hold the role of - ✔✔Data custodians
✔✔To gain a competitive advantage, maintain profitability, and satisfy customers an
organization must - ✔✔Be able to trust its data.
✔✔Which one of the following is an example of a data governance tool? - ✔✔external
policy
✔✔Which one of the following data governance tools allows the data governance
committee to look at data relationships and interdependencies across the organization?
- ✔✔Enterprise data models
✔✔Ensuring quality data requires a - ✔✔Systematic and purpose-driven review process
✔✔Which one of the following defines the duties of a data steward? - ✔✔A data
steward is an experienced business analyst
✔✔Which one of the following provides the frame of reference needed so data can be
used appropriately for analysis and decision-making? - ✔✔Metadata
✔✔Under the General Data Protection Regulation (GDPR), a data controller's role is to -
✔✔Define how and for what purpose personal data should be processed
✔✔The Auditing Standard No. 5 (AS 5) calls for a specific fraud assessment because -
✔✔The failure to prevent or detect fraudulent misstatements is higher than the risk of
failing to prevent or detect other types of errors
✔✔One internal control integrated framework consists of five essential components: the
control environment, risk assessment, control activities, information and communication,
and monitoring activities. When these components are applied across the organization,
