WGU D217 Accounting Information Systems OA ACTUAL EXAM STUDY GUIDE 2025/2026 COMPLETE QUESTIONS WITH CORRECT DETAILED ANSWERS || 100% GUARANTEED PASS <RECENT VERSION>

WGU D217 Accounting Information Systems OA ACTUAL EXAM STUDY GUIDE 2025/2026 COMPLETE QUESTIONS WITH CORRECT DETAILED ANSWERS || 100% GUARANTEED PASS &lt;RECENT VERSION&gt; 1. Which department is least likely to be involved in the revenue cycle? - ANSWER The accounts payable department is least likely to be involved in the revenue cycle. Accounts payable is charged with managing the segment of the expenditure cycle that involves payments to vendors and creditors. 2. The purpose of the sales invoice is to - ANSWER The purpose of the sales invoice is to bill the customer. The sales invoice will be sent to the customer for payment. At the same time the invoice will also update inventory, send a journal to the general ledger, and record the sales journal. 3. Which type of control is considered a compensating control for customer payments? - ANSWER Supervision is a compensating control for customer payments. Compensating controls are put in place when more effective controls are deemed too difficult or costly to implement. Supervision is the simplest and most common form of compensating control. 4. Commercial accounting systems have fully integrated modules. The word "integrated" means that - ANSWER The word "integrated" means that the transfer of information among modules occurs automatically. In a fully integrated system, the shipping advice will generate the request for invoice automatically. This eliminates the risk that the invoice request is not processed or is processed for a different amount. 5. A copy of the purchase order (PO) is sent to the - ANSWER A copy of the purchase order (PO) is sent to the vendor. The purchase order is the formal document that tells the vendor what material is needed, at what price, in what quantity and on what date. 6. The departments involved in the purchasing process are purchasing, receiving, inventory control and - ANSWER The departments involved in the purchasing process are purchasing, receiving, inventory control and accounts payable. Accounts payable completes the purchasing process by authorizing and executing the cash disbursement based on a signal from receiving or inventory control. 7. An organization could have more than one system in place; there could be an in-house system along with a newer commercial system. How is the communication among many different systems made possible? - ANSWER Special software patches need to be applied. 8. An enterprise resource planning (ERP) system is more than simply an elaborate transaction processing system. What else does an ERP system provide? - ANSWER It is a decision support tool that supplies management with real-time information and permits timely decisions that are needed to improve performance and achieve competitive advantage. 9. What can be used to assess the adequacy of a client's access controls? - ANSWER Many firms are now performing penetration tests designed to assess access control by imitating known techniques that hackers use. 10. Which attributes are used to describe data that are reliable for use according to the Safe Harbor Agreement? - ANSWER Organizations need to ensure that the data they maintain are accurate, complete, and current, and thus reliable for use. 11. Which condition of the Safe Harbor Agreement addresses the privacy concern related to the purposes for which an organization collects and uses information? - ANSWER An organization must provide individuals with clear notice of "the purposes for which it collects and uses information about them and the types of third parties to which it discloses the information." 12. Which statement describes the condition of onward transfer? - ANSWER Unless they have the individual's permission to do otherwise, organizations may share information only with those third parties that belong to the Safe Harbor Agreement or that follow its principles. 13. Which standard does the Safe Harbor Agreement establish for information? - ANSWER The two-way agreement between the United States and the European Union establishes standards for information transmittal. 14. What exemplifies the use of continuous auditing? - ANSWER An intelligent control agent searches electronic transactions for anomalies. 15. A primary role for accountants during the detailed design phase is - ANSWER A primary role for accountants during the detailed design phase is to provide expertise in accounting functions, controls and processes. 16. An accountant's responsibility in the systems development life cycle (SDLC) is - ANSWER A primary role for accountants during the systems development lifecycle (SDLC) is to ensure that the system applies proper accounting conventions and rules and possesses adequate control. As with the design phase, accountants must ensure that both the system, and the development process, are applying proper accounting conventions and controls. Not only are proper accounting rules and processes being built into the system but is the system development subject to proper testing and documentation controls as required by SAS 109 and Sarbanes- Oxley. 17. An accountant's responsibility during the implementation of the system is - ANSWER A primary role for accountants during the implementation phase is to represent the interests of the accounting and finance department. The member of the project team representing accounting and finance will work with the other team members to ensure that the requirements agreed during the design and development phases are properly implemented. They will look at test results and documentation to ensure that results are correct and meet requirements. 18. Accountants will provide technical expertise in - ANSWER Accountants will provide technical expertise in GAAP, GAAS, SEC Requirements and IRS Codes. The implementation of a new accounting or financial information system will need to be sure to include data and reporting that assists the accounting and finance departments in following GAAP, GAAS and meeting SEC and IRS requirements. Accountants are the experts. They guide the project team in meeting these needs. 19. Documentation standards are set - ANSWER In the implementation phase, the accountant plays a role in specifying system documentation. Because financial systems must periodically be audited, they must be adequately documented. The accountant must actively encourage adherence to effective documentation standards. 20. Statement on Auditing Standards No. 109 requires - ANSWER Statement on Auditing Standards No. 109 requires the accountant's involvement at both the detailed design and implementation phases. Controls may be programmed or manual procedures. Some controls are part of the daily operation of the system, while others are special actions that precede, follow, or oversee routine processing. 21. End users are - ANSWER End users are those for whom the system is built. There are many users at all levels in an organization. These include managers, operations personnel from various functional areas including accountants. During systems development, systems professionals work with the primary users to obtain an understanding of the users' problems and a clear statement of their needs. For example, accountants must specify accounting techniques to be used for certain transactions, internal control requirements. 22. The systems steering committee - ANSWER The systems steering committee oversees systems development and assigns priorities. Most organizations have a C-level Steering Committee chaired by the Chief Information Officer that sets overall systems development priorities and strategies. They will also have a project level steering committee that will oversee the project and set priorities. 23. A commercial software system that is finished, tested, and ready for implementation is called a - ANSWER A commercial system that is finished, tested and ready for implementation is called a turnkey system. Turnkey systems are generally sold with very limited capability for customization outside of some input, output and processing options chosen through menu selections. Examples of turnkey systems include general accounting systems, special purpose systems and office automation systems. 24. A key offering for a vendor supported system is - ANSWER Vendor supported systems are systems that the vendor develops and maintains for the client organization. The vendor will offer services in application installation, system configuration, data conversion, personnel training, and trouble shooting and maintenance. 25. The prime advantage of in-house development is - ANSWER The prime advantage of in-house development is the ability to produce applications to exact specifications. This advantage also describes a disadvantage of commercial software. Sometimes, the user's needs are unique and complex, and commercially available software is either too general or too inflexible. 26. Which of the following is true about commercial software? - ANSWER Commercial software can be installed faster than a custom system. One of the major advantages of a commercial system, especially one chosen because of its ability to support the firm and meet the firm's requirements, is that it can be installed more quickly than a custom system. Programs have been written and tested. Modules have been documented. Controls to meet audit requirements are in place. In a custom development, all of these must be built from scratch. 27. The systems development process constitutes a set of activities that are of interest to accountants and auditors because - ANSWER A materially flawed financial application can corrupt financial data, which may then be incorrectly reported in the financial statements. 28. The systems development process constitutes - ANSWER The systems development process constitutes a set of activities by which organizations obtain IT-based information systems. Systems development is like any manufacturing process that produces a complex product through a series of stages. 29. The system development process is important to accountants because - ANSWER The system development process is important to accountants because they are as concerned about the integrity of this process as they are with any manufacturing process that has financial resource implications. The quality of accounting information presented in an organization's financial statements is directly related to the quality of the accounting information systems that process and report it. 30. Turnkey systems - ANSWER Turnkey systems are completely finished and tested systems that are ready for implementation. These are often general-purpose systems or systems customized to a specific industry. 31. General accounting systems - ANSWER General accounting systems are designed to serve a wide variety of user needs. By mass-producing a standard system, the vendor is able to reduce the unit cost of these systems to a fraction of in-house development costs. 32. Backbone systems - ANSWER Backbone systems provide a basic system structure on which to build. Backbone systems come with all the primary processing modules programmed. The vendor designs and programs the user interface to suit the client's needs. Some systems such as enterprise resource planning (ERP) offer a vast array of modules for dealing with almost every conceivable business process, and all are interfaced seamlessly into a single system. 33. Special-purpose systems - ANSWER Special-purpose systems target selected segments of the economy. Some software vendors create special purpose systems that target selected segments of the economy. For example, the medical field, the banking industry, and government agencies have unique accounting procedures, rules, and conventions that general- purpose accounting systems do not always accommodate. 34. The growth of commercial software development is driven in part by - ANSWER Four factors have contributed to the growth of the commercial software market: (1) the relatively low cost of general commercial software as compared to customized software; (2) the emergence of industry-specific vendors who target their software to the needs of particular types of businesses; (3) a growing demand from businesses that are too small to afford in-house systems' development staff; and (4) the trend toward downsizing organizational units and the move toward distributed data processing has made the commercial software option appealing to larger organizations. 35. Access tests - ANSWER Access tests verify that individuals or programs are valid. Access tests verify that individuals, programmed procedures, or messages (e.g., electronic data interchange [EDI] transmissions) attempting to access a system are authentic and valid. Access tests include verifications of user IDs, passwords, valid vendor codes, and authority tables. 36. Testing the three-way match involves - ANSWER This test involves creating two test master files: a purchase order file and a receiving report file. The transaction in this case is the supplier's invoice. The test data should be designed to contain discrepancies that fall both within and outside of acceptable limits, based on company policy. When the invoice is entered, the AP system should match the three documents (create a digital AP packet) and reconcile the quantities ordered with those received, and the invoice amount with the expected price. The auditor will reconcile both rejected and accepted invoices to determine that the control is functioning in accordance with company policy. 37. Which of the following is an advantage of the test data technique? - ANSWER To employ this approach, the auditor requires detailed and current systems documentation: (1) program flowcharts that describe the application's internal logic and allow the auditor to determine which logic branches to test, and (2) record layout diagrams that describe the structure of transaction and master files, which will allow the auditor to create test data. 38. Parallel simulation - ANSWER Parallel simulation involves creating a program that simulates key features or processes of the application under review. The simulated application is then used to reprocess the same transactions that the production application previously processed. 39. An organization's internal controls have been deemed effective by management and external audits for the last five years. A proposal is made to upgrade the enterprise resource planning (ERP) system at a significant cost. The proposal mentions slightly increased IT controls to better detect errors. Which modifying assumption would keep management from implementing the upgrade? - ANSWER The reasonable assurance modifying assumption states that the four objectives of internal control are met in a cost-effective manner. The upgrade is expensive, and the benefits will be limited. Since the current system is effective, the management team may decide to reject the upgrade due to cost-effectiveness. 40. Which of the following is a problem usually associated with the flat-file approach to data management? - ANSWER data redundancy 41. Which problem is characteristically associated with the flat-file approach to data management? - ANSWER the inability to determine what data is available 42. A description of the physical arrangement of records in the database is - ANSWER the internal view. 43. Which of the following may provide many distinct views of the database? - ANSWER the user view 44. The update anomaly in unnormalized tables - ANSWER occurs because of data redundancy. 45. The deletion anomaly in unnormalized tables - ANSWER may result in the loss of important data. 46. Which document triggers the revenue cycle? - ANSWER the customer purchase order 47. Which component of the Committee of Sponsoring Organizations of the Treadway Commission (COSO) framework is being considered when an auditor is comparing a company's organization chart to the prior year's chart to identify new personnel who are responsible for internal controls? - ANSWER Risk assessment's purpose is to identify, analyze, and manage risks related to financial reporting. New personnel create risk because they may not fully understand or be aware of an organization's internal controls. 48. What is one of the four areas that ethical issues in business can be divided into? - ANSWER Ethical issues in business can be divided into the areas of equity, rights, honesty, and exercise of corporate power. These areas can be used to assess any ethical situation, whether it is a computer-based issue or not. 49. A disgruntled employee places a logic bomb to erase an organization's supplier list. Which type of fraud does this scenario reflect? - ANSWER Database management fraud involves altering, deleting, corrupting, destroying, or stealing an organization's data. 50. Which access point is the most common for committing computer fraud? - ANSWER The data collection stage is the most common access point for perpetrating computer fraud. 51. According to the Public Company Accounting Oversight Board (PCAOB) Standard No. 5, auditors need to understand transaction flows, including the controls pertaining to how transactions are initiated, authorized, recorded, and reported. Which accounts are affected by this requirement? - ANSWER The auditors are interested in the financial accounts that can materially affect the accuracy of the financial statements. 52. Management is required to provide external auditors with documented evidence of functioning controls related to selected material accounts in a report on control effectiveness. How is this evidence obtained? - ANSWER The internal audit department of the organization would perform and document the necessary tests. 53. Mail room Clerk - ANSWER Duties -The mail room clerk opens the envelopes and reconciles checks and remittances. 54. Internal control activities consist of: - ANSWER Physical controls and IT controls 55. Physical Internal controls - ANSWER transaction authorization, segregation of duties, supervision, accounting records, access control, and independent verification 56. IT controls - ANSWER IT controls comprise general controls and application controls. General controls are not specific to a particular cycle or subsystem and thus do not apply to expenditure cycle risks directly. Computer application controls consist of input controls, processing controls, and output controls 57. What is the purpose of a purchase requisition? - ANSWER The purchase requisition ensures items purchased are only from authorized vendors. 58. What are the accounting functions for the accounts payable? - ANSWER Collect data and invoices to properly complete transactions 59. How do internal controls affect daily activities? - ANSWER They protect an organization from risk, and therefore, physical controls and IT controls are used 60. Three Way Match - ANSWER Is made up of Supplier's invoice, receiving report and purchase order. The reconciliation of the receiving reports with the PO signifies that the organization has a legitimate obligation to pay. 61. personnel action forms - ANSWER Document identifying employees authorized to receive a paycheck; the form is used to reflect changes in pay rates, payroll deductions, and job classification. 62. Payroll Register - ANSWER Includes Pay rate, withholding information, and hours worked. Document showing gross pay, deductions, overtime pay, and net pay. 63. payroll imprest account - ANSWER account into which a single check for the entire amount of the payroll is deposited 64. Which document contains details on the acquisition of a fixed asset? - ANSWER Depreciation report 65. Who are the primary recipients of financial information? - ANSWER Investors and creditors 66. general ledger and other files that constitute the audit trail should be detailed and rich enough to: - ANSWER 1)provide the ability to answer inquiries, for example, from customers or vendors; (2)be able to reconstruct files if they are completely or partially destroyed; (3)provide historical data required by auditors; (4)fulfill government regulations; and (5)provide a means for preventing, detecting, and correcting errors.