Test Bank For Data Analytics for Accounting, 3rd Edition Richardson

Test Bank For Data Analytics for Accounting, 3rd Edition Richardson Chapter 1-9 Answers are at the End of Each Chapter Chapter 01: Student name:__________ 1) Data analytics is the process of evaluating data with the purpose of drawing conclusions to

address business questions. ⊚ true ⊚ false

2) The process of data analytics aims to transform raw information into data to create value. ⊚ true ⊚ false

3) Data analytics has the potential to transform the manner in which companies run their

businesses, however it is not practical in the near future. ⊚ true ⊚ false

4) Auditors can use social media to hear what customers are saying about a company and

compare this to inventory obsolescence and other estimates. ⊚ true ⊚ false

5) Data analytics allows auditors to glean insights that are beneficial to the client, without

breeching independence. ⊚ true ⊚ false

6) The predictive analytics is an important aspect of data analytics for auditors, but is not

applicable for tax accountants. ⊚ true ⊚ false

7) The I in IMPACT Cycle represents Identify the Question. ⊚ true ⊚ false

8) The M in IMPACT Cycle represents Master the Data. ⊚ true ⊚ false

9) The P in IMPACT Cycle represents Predict the Results. ⊚ true ⊚ false

10) The A in IMPACT Cycle represents Analyze the Data. ⊚ true ⊚ false

11) The C in IMPACT Cycle represents Continuously Track. ⊚ true ⊚ false

12) The T in IMPACT Cycle represents Track Outcomes. ⊚ true ⊚ false

13) The IMPACT cycle is iterative, as insights are gained, outcomes are tracked, and new

questions are identified. ⊚ true ⊚ false

14) Data analysis through data manipulation is performing basic analysis to understand the

quality of the underlying data and its ability to address the business question. ⊚ true ⊚ false

15) To be proficient in data analysis, accountants need to become data scientists. ⊚ true ⊚ false

16) By developing an analytics mindset, accountants will be able to recognize when and how

data analytics can address business questions. ⊚ true ⊚ false

17) While it is important for accountants to clearly articulate the business problem, drawing

appropriate conclusions, based on the data, should be left to statisticians. ⊚ true ⊚ false

18) Analytic-minded accountants should report results of analysis in an accessible way to each

varied decision maker and their specific needs. ⊚ true ⊚ false

19) With a goal to give organizations the information they need to make sound and timely

business decisions, data analytics often involves all of the following except: A) technologies.

B) statistics.

C) strategies.

D) databases.

20) Patterns discovered from __________ enable businesses to identify opportunities and risks

and better plan for __________.

A) past archives; the future B) current data; the future C) current data; today D) past archives; today

21) Which of the following best describes the goal of descriptive data analysis: A) recognize what is meant by data quality, be it completeness, reliability or validity B) perform basic analysis to understand the quality of the underlying data and its ability

to address the business question C) demonstrate ability to sort, rearrange, merge, and reconfigure data in a manner that allows enhanced analysis D) comprehend the process needed to clean and prepare the data before analysis

22) Which of the following Microsoft software tool specializes in data joining?

A) Excel B) Power Query C) Power BI D) Power Automate

23) Which of the following Microsoft software tools specializes in creating dashboards?

A) Excel B) Power Query C) Power BI D) Power Automate

24) Which of the following Tableau software tools specializes in data transformation?

A) Tableau Desktop B) Tableau Prep Builder C) Tableau Public D) Tableau Visualize

25) Which of the following Tableau software tools specializes in creating dashboards?

A) Tableau Desktop B) Tableau Prep Builder C) Tableau Public D) Tableau Visualize

26) Which of the following best describes the goal of data quality: A) recognize what is meant by data quality, be it completeness, reliability or validity B) perform basic analysis to understand the quality of the underlying data and its ability

to address the business question C) demonstrate ability to sort, rearrange, merge, and reconfigure data in a manner that allows enhanced analysis D) comprehend the process needed to clean and prepare the data before analysis

27) Which of the following best describes the goal of data manipulation: A) recognize what is meant by data quality, be it completeness, reliability or validity B) perform basic analysis to understand the quality of the underlying data and its ability

to address the business question C) demonstrate ability to sort, rearrange, merge, and reconfigure data in a manner that allows enhanced analysis D) comprehend the process needed to clean and prepare the data before analysis

28) Which of the following best describes the goal of data scrubbing and data preparation: A) recognize what is meant by data quality, be it completeness, reliability or validity B) perform basic analysis to understand the quality of the underlying data and its ability

to address the business question C) demonstrate ability to sort, rearrange, merge and reconfigure data in a manner that allows enhanced analysis D) comprehend the process needed to clean and prepare the data before analysis

29) Which of the following best describes the goal of developing an analytics mindset: A) recognize when and how data analytics can address business questions B) perform basic analysis to understand the quality of the underlying data and its ability

to address the business question C) recognize what is meant by data quality, be it completeness, reliability or validity D) comprehend the process needed to clean and prepare the data before analysis

30) Which of the following best describes the goal of data visualization and data reporting: A) recognize when and how data analytics can address business questions B) perform basic analysis to understand the quality of the underlying data and its ability

to address the business question C) recognize what is meant by data quality, be it completeness, reliability or validity D) report results of analysis in an accessible way to each varied decision maker and their specific needs

31) Which of the following best describes the goal of defining and addressing problems through

statistical data analysis: A) recognize what is meant by data quality, be it completeness, reliability or validity B) perform basic analysis to understand the quality of the underlying data and its ability to address the business question C) demonstrate ability to sort, rearrange, merge and reconfigure data in a manner that allows enhanced analysis D) identify and implement an approach that will use statistical data analysis to draw conclusions and make recommendations on a timely basis

32) While accountants don't need to become data scientists, they must know how to do the

following except: A) Clearly articulate the business problem the company is facing B) Communicate with the data scientists about specific data needs and understand the underlying quality of the data C) Build a data repository D) Comprehend the process needed to clean and prepare the data before analysis

33) Data analytics professionals estimate that they spend between __________ of their time

cleaning data so it can be analyzed.

A) B) C) D)

50 percent and 90 percent 10 percent and 20 percent 20 percent and 50 percent 70 percent and 95 percent

34) Which approach to data analytics attempts to estimate or predict, for each unit, the numerical

value of some variable using some type of statistical model?

A) Similarity matching.

B) Classification.

C) Data reduction.

D) Regression.

35) Which approach to data analytics attempts to characterize the typical behavior of an

individual, group or population by generating summary statistics about the data?

A) Similarity matching.

B) Profiling.

C) Data reduction.

D) Regression.

36) Since some transactions need more attention than others, the data reduction approach would

arguably be most important for the __________ function.

A) B) C) D)

audit tax. management accounting.

Regression.

37) Which approach to data analytics attempts to reduce the amount of information that needs to

be considered to focus on the most critical items?

A) Similarity matching.

B) Profiling.

C) Data reduction.

D) Regression.

38) Which of the following best describes the classification approach to data analytics?

A) An attempt to assign each unit (or individual) in a population into a few categories.

B) An attempt to identify similar individuals based on data known about them.

C) An attempt to divide individuals into groups in a useful or meaningful way.

D) An attempt to discover associations between individuals based on transactions

involving them.

39) Which of the following best describes the clustering approach to data analytics?

A) An attempt to assign each unit (or individual) in a population into a few categories.

B) An attempt to identify similar individuals based on data known about them.

C) An attempt to divide individuals into groups in a useful or meaningful way.

D) An attempt to discover associations between individuals based on transactions

involving them.

40) Which of the following best describes the similarity matching approach to data analytics?

A) An attempt to assign each unit (or individual) in a population into a few categories.

B) An attempt to identify similar individuals based on data known about them.

C) An attempt to divide individuals into groups in a useful or meaningful way.

D) An attempt to discover associations between individuals based on transactions

involving them.

41) Which of the following best describes the regression approach to data analytics?

A) An attempt to estimate or predict, for each unit, the numerical value of some variable

using some type of statistical model.

B) An attempt to predict a relationship between two data items.

C) An attempt to divide individuals into groups in a useful or meaningful way.

D) An attempt to discover associations between individuals based on transactions involving them.

42) Which of the following best describes the co-occurrence grouping approach to data

analytics?

A) An attempt to characterize the typical behavior of an individual, group or population by generating summary statistics about the data.

B) An attempt to predict a relationship between two data items.

C) An attempt to reduce the amount of information that needs to be considered to focus on the most critical items.

D) An attempt to discover associations between individuals based on transactions involving them.

43) Which of the following best describes the link prediction approach to data analytics?

A) An attempt to characterize the typical behavior of an individual, group or population

by generating summary statistics about the data.

B) An attempt to predict a relationship between two data items.

C) An attempt to reduce the amount of information that needs to be considered to focus on the most critical items.

D) An attempt to discover associations between individuals based on transactions involving them.

44) Which of the following best describes the profiling approach to data analytics?

A) An attempt to characterize the typical behavior of an individual, group or population

by generating summary statistics about the data.

B) An attempt to predict a relationship between two data items.

C) An attempt to reduce the amount of information that needs to be considered to focus on the most critical items.

D) An attempt to discover associations between individuals based on transactions involving them.

45) Which of the following best describes the data reduction approach to data analytics?

A) An attempt to characterize the typical behavior of an individual, group or population

by generating summary statistics about the data.

B) An attempt to predict a relationship between two data items.

C) An attempt to reduce the amount of information that needs to be considered to focus on the most critical items.

D) An attempt to discover associations between individuals based on transactions involving them.

46) Which approach to data analytics attempts to discover associations between individuals

based on transactions involving them?

A) Similarity matching.

B) Clustering.

C) Co-occurrence grouping.

D) Link prediction.

47) Which approach to data analytics attempts to identify similar individuals based on data

known about them?

A) Similarity matching.

B) Clustering.

C) Co-occurrence grouping.

D) Link prediction.

48) Which approach to data analytics attempts to predict a relationship between two data items?

A) Similarity matching.

B) Clustering.

C) Co-occurrence grouping.

D) Link prediction.

49) Which approach to data analytics attempts to divide individuals into groups in a useful or

meaningful way?

A) Similarity matching.

B) Clustering.

C) Co-occurrence grouping.

D) Link prediction.

50) The IMPACT cycle includes all the following processes except: A) Identify the questions.

B) Address and refine results.

C) Track outcomes.

D) Predict the results.

51) One of the most important aspects of data analytics that impacts tax is: A) predictive analytics.

B) co-occurrence grouping.

C) similarity matching.

D) data quality.

52) If we are predicting which companies go bankrupt, bankruptcy would be the A) dependent variable B) independent variable C) explanatory variable D) classification variable

53) If a bank uses credit risk score to determine who will receive a loan, the credit risk score

would be considered the: A) dependent variable B) independent variable C) response variable D) classification variable

54) If a bank uses credit risk score to determine who will receive a loan, the variable predicting

who will receive a loan would be considered the: A) dependent variable B) independent variable C) determinant variable D) classification variable

55) The 4V’s of Big Data include all but the following: A) volatility B) variety C) velocity D) veracity

56) A recent study from McKinsey Global Institute estimates that Data Analytics could generate

up to $2 __________ in value.

A) billion B) trillion C) million D) thousand

57) The PwC’s 6th Annual Digital IQ survey of more than 1,400 leaders from digital business, the

area of investment that tops CEOs’ list of priorities is: A) information technology B) capital expenditures including hardware and software C) accounting data analytics D) business analytics

58) According to PwC’s 18th Annual Global CEO survey, __________ percent of chief executive

officers put a high value on data analytics.

A) 95 B) 86 C) 55 D) 35

59) According to the text, as the debt-to-income ratio increases, there is __________ chance of a

loan getting rejected by the bank.

A) a greater B) a lesser C) no effect on the

60) According to the text, as the length of employment increases, there is __________ chance of

a loan getting rejected by the bank.

A) a greater B) a lesser C) no effect on the

61) According to the text, as the credit score increases, there is __________ chance of a loan

getting rejected by the bank.

A) a greater B) a lesser C) no effect on the

62) In the LendingClub dataset, a credit score is synonymous with: A) a debt score.

B) a risk score.

C) a credit card score.

D) a premium score.

63) List and describe the eight (8) different approaches to data analytics.

64) List and explain four (4) of the seven (7) data analytic skills needed by analytic-minded

accountants:

65) As more and more data are available, some would argue that the role of accounting is

changing. While accountants don't need to become data scientists, they must develop a base level skill set. Whether they are the Director of Tax for Hewlett Packard or their external auditor, which basic skills are needed by an analytic-minded accountant?

66) What is the regression approach? How might the regression approach be used in auditing?

67) Assume that you have just started a new job as a credit manager for a Fortune 500 company.

Using all steps in the IMPACT Cycle, provide examples of tasks that would be performed as part of each step and state the information/data you would need to make a decision if a customer is credit worthy.

Answer Key Test name: chapter 1 1) TRUE 2) FALSE 3) FALSE 4) TRUE 5) TRUE 6) FALSE 7) TRUE 8) TRUE 9) FALSE 10) FALSE 11) FALSE 12) TRUE 13) TRUE 14) FALSE 15) FALSE 16) TRUE 17) FALSE 18) TRUE 19) C 20) A 21) B 22) B 23) C 24) B 25) A 26) A 27) C 28) D 29) A 30) D 31) D 32) C 33) A 34) D 35) B 36) A 37) C

38) A 39) C 40) B 41) A 42) D 43) B 44) A 45) C 46) C 47) A 48) D 49) B 50) D 51) A 52) A 53) B 54) A 55) A 56) B 57) D 58) B 59) A 60) B 61) B 62) B 63) Essay 64) Essay 65) Essay 66) Essay 67) Essay

Student name:__________ 68) Mastering the data requires a firm understanding of what data is available to you and where it

is stored, as well as being skilled in the process of extracting, transforming, and loading (ETL). ⊚ true ⊚ false

69) A flat file is a means of storing data in one place, such as in an Excel spreadsheet, as opposed

to storing the data in multiple tables, such as in a relational database. ⊚ true ⊚ false

70) A foreign key is an attribute that is required to exist in each table of a relational database and

serves as the unique identifier for each record in a table. ⊚ true ⊚ false

71) A primary key is an attribute that is required to exist in each table of a relational database and

serves as the unique identifier for each record in a table. ⊚ true ⊚ false

72) A foreign key is an attribute that exists in relational databases in order to carry out the

relationship between two tables. ⊚ true ⊚ false

73) A composite primary key is made up of the three or more primary keys in the tables that it is

linking. ⊚ true ⊚ false

74) Descriptive attributes are attributes that exist in relational databases that are neither primary

nor foreign keys. ⊚ true ⊚ false

75) Once you have extracted the data of interest, it will need to be validated for completeness and

existence. ⊚ true ⊚ false

76) The M in IMPACT Cycle represents Manipulating the Data. ⊚ true ⊚ false

77) In order to obtain the right data, it is important to have a firm grasp of what data is available

and how it is stored. ⊚ true ⊚ false

78) Data normalization can reduce data redundancy and improve data integrity. ⊚ true ⊚ false

79) Much like the IMPACT cycle, requesting data is often an iterative process. ⊚ true ⊚ false

80) Unlike the IMPACT cycle, requesting data is not an iterative process. ⊚ true ⊚ false

81) If the extraction and transformation steps have been done correctly, the loading part of the

ETL process should be the simplest step. ⊚ true ⊚ false

82) After obtaining the data and determining the purpose and scope of the data request, the next

step is to validate the data. ⊚ true ⊚ false

83) Formatting negative numbers is an example of cleaning the data. ⊚ true ⊚ false

84) A template can make communication easier between data requestor and provider. ⊚ true ⊚ false

85) Mastering the data can also be described via the ETL process. The ETL process stands for: A) Extract, total, and load data.

B) Extract, transform, and load data.

C) Enter, transform, and load data.

D) Enter, total, and load data.

86) All of the following are Audit Data Standards (ADS) developed by the American Institute of

Certified Public Accountants except: A) Investments subledger standards B) General Ledger standards C) Procure-to-Pay subledger standards D) Order-to-Cash subledger standards

87) When using [EmployeeID] as the unique identifier of the Employee table, [EmployeeID] is

an example of which of the following: A) Foreign key B) Composite key C) Primary key D) Key attribute

88) What would be the best primary key for the LendingClub rejected loan dataset?

A) Loan application number B) Zip code C) Customer number D) Loan number

89) The objective of data extraction is: A) To validate the data for completeness and integrity B) To load the data into the appropriate tool for analysis C) To identify and obtain the data from the appropriate source D) To identify which approach to data analytics should be used

90) The objective of data transformation is: A) To validate the data for completeness and integrity B) To load the data into the appropriate tool for analysis C) To identify and obtain the data from the appropriate source D) To identify which approach to data analytics should be used

91) The objective of loading data is: A) To validate the data for completeness and integrity B) To load the data into the appropriate tool for analysis C) To identify and obtain the data from the appropriate source D) To identify which approach to data analytics should be used

92) All of the following are included in the five steps of the ETL process except: A) Determine the purpose and scope of the data request B) Obtain the data C) Validate the data for completeness and integrity D) Scrub the data

93) Which of the following best exemplifies a way that data will need to be cleaned after

extraction and validation?

A) Remove headings and subtotals B) Validate date/time fields C) Remove trailing zeroes D) Compare string limits for text fields

94) Removing headings or subtotals from data is an example of which of the following?

A) Validating the data for completeness B) Validating the data for integrity C) Cleaning the data D) Obtaining the data

95) Correcting inconsistencies across data is an example of which of the following?

A) Validating the data for completeness B) Validating the data for integrity C) Cleaning the data D) Obtaining the data

96) Formatting negative numbers in the data is an example of which of the following?

A) Validating the Data for Completeness B) Validating the Data for Integrity C) Cleaning the Data D) Obtaining the Data

97) Removing leading zeroes and non-printable characters from the data is an example of which

of the following?

A) Validating the data for completeness B) Validating the data for integrity C) Cleaning the data D) Obtaining the data

98) Comparing descriptive statistics for numeric fields within the data is an example of which of

the following?

A) Validating the data for completeness B) Validating the data for integrity C) Cleaning the data D) Obtaining the data

99) Comparing the number of records within the data is an example of which of the following?

A) Validating the data for completeness B) Validating the data for integrity C) Cleaning the data D) Obtaining the data

100)

Which of the following questions are NOT suggested by the Institute of Business Ethics to allow a business to create value from data use and analysis, and still protect the privacy of stakeholders?

A) How does the company use data, and to what extent is it integrated into firm strategy?

B) Does the company send a privacy notice to individuals when their personal data is collected?

C) Is the data kept in a secure location preventing access from unauthorized users?

D) Does the company have the appropriate tools to mitigate the risks of data misuse?

101)

Which of the following questions are NOT suggested by the Institute of Business Ethics to allow a business to create value from data use and analysis, and still protect the privacy of stakeholders?

A) Does our company conduct appropriate due diligence when sharing with or acquiring data from third parties?

B) How does the company use data, and to what extent is it integrated into firm strategy?

C) Does the company send a privacy notice to individuals when their personal data is collected?

D) Does the company require analysts to sign a confidentiality agreement the information found in the data?

102)

Which of the following best describes the purpose of a primary key?

A) To uniquely identify each row in a table.

B) To create the relationship between two tables.

C) To provide business information, but are not required to build a database.

D) To support business processes across the organization.

103)

Which of the following best describes the purpose of a non-key attribute?

A) To ensure that each row in the table is unique B) To create the relationship between two tables C) To provide business information D) To support business processes across the organization

104)

Which of the following best describes the purpose of relational databases?

A) To ensure that business rules are enforced B) To increase information redundancy in the organization C) To provide business information to data analysts D) To support business processes across the organization

105)

Which of the following best describes the purpose of a foreign key?

A) To ensure that each row in the table is unique B) To create the relationship between two tables C) To provide business information D) To support business processes across the organization

106)

A data dictionary is paramount in helping data analysts do which of the following?

A) Maintain databases.

B) Identify the data they need to use.

C) Communicating insights.

D) Track outcomes.

107)

A data dictionary is paramount in helping database administrators do which of the following?

A) Maintain databases.

B) Identify the data they need to use.

C) Communicating insights.

D) Track outcomes.

108)

At which step of the ETL process should you try to answer the question "What tools will be used to perform data analytic tests or procedures and why?"

A) Step 1: Determine the purpose and scope of the data request.

B) Step 2: Obtain the data.

C) Step 3 or 4: Transformation.

D) Step 5: Loading the data for data analysis.

109)

At which step of the ETL process should you try to answer the question "What other information will impact the nature, timing and extent of the data analysis?"

A) Step 1: Determine the purpose and scope of the data request.

B) Step 2: Obtain the data.

C) Step 3 or 4: Transformation.

D) Step 5: Loading the data for data analysis.

110)

At which step of the ETL process should you try to answer the question "What business problem will the data address?"

A) Step 1: Determine the purpose and scope of the data request.

B) Step 2: Obtain the data.

C) Step 3 or 4: Transformation.

D) Step 5: Loading the data for data analysis.

111)

At which step of the ETL process should you try to answer the question "Where are the data located in the financial or other related systems?"

A) Step 1: Determine the purpose and scope of the data request.

B) Step 2: Obtain the data.

C) Step 3 or 4: Transformation.

D) Step 5: Loading the data for data analysis.

112)

When obtaining the data yourself, you should do all of the following before you begin except: A) Identify the tables that contain the information you need.

B) Identify which attributes specifically hold the information you need in each table.

C) Identify how those tables are related to each other.

D) Identify any errors or issues from the extraction.

113)

There are a variety of methods that you could take to retrieve the data, including SQL. What does SQL stand for?

A) Systems Query Language.

B) Systems Question Language.

C) Structured Question Language.

D) Structured Query Language.

114)

All of the following are benefits of using a normalized relational database except: A) Completeness.

B) No redundancy.

C) Business rules are enforced.

D) Data is stored in one place.

115)

Which of the following is most likely to be the primary key in an Employee table?

A) Employee ID B) Employee Social Security Number C) Employee Name D) Employee Type

116)

Comparing the number of records that were extracted to the number of records in the source database is an example of which ETL step.

A) Validating the Data B) Obtaining the Data C) Cleaning the Data D) Loading the Data for Analysis

117)

Chapter 2 describes the various ways in which data can be stored for differing purposes.

Describe the two ways data can be organized and the purpose for each organizational structure.

118)

Taylor is a new staff accountant for a fortune 100 company. After hearing that she just successfully completed an Accounting Data Analytics course, her boss said, "Get me a listing of all our deadbeat customer, so I can cut off their credit." After asking clarifying questions, Taylor was able to determine that root request was "Which customer, with a credit limit over $10,000, have more than $5,000 outstanding for more than 90 days at the prior quarter's end?" Using the ETL Techniques, briefly describe the process Taylor will have to complete to answer her boss' question. (Assume that Taylor does not have direct access to the data, rather the data will be exported into an Excel file, and she will complete the analysis with an Excel Pivot Table.)

119)

Define and give 1 example of a primary key, a foreign key, and non-key attribute.

120)

Assume that you will be up for a promotion next month and you'd like to analyze a database that was recently assigned to you to show off your data analytic skills. After identifying the goal of your data analysis, using the first step of the IMPACT cycle, what steps would you take if you have direct access to the database?

121)

Assume that you have just completed the extraction process on a data set. As you begin validating the data for completeness and integrity, you notice an error. Describe the steps you might take to determine the source of an error.

122)

Which of the following describes a means of maintaining all of your data in one place, instead of across different related tables?

A) Flat File B) Microsoft Access C) SQL lite D) Microsoft SQL Server

123)

Which of the following is NOT true regarding Primary Keys?

A) The purpose of the primary key is to uniquely identify each column in a table.

B) A primary key is typically a sequential number instead of something truly descriptive about each record.

C) Primary keys are required in each table in a relational database.

D) Primary keys do not provide meaningful business information.

124)

Relational databases help to reduce redundant data. Which of the following is NOT a reason to reduce redundant data?

A) It takes up unnecessary space B) It is expensive C) It increases the risk of data-entry errors D) It is easier to perform analysis in spreadsheets

125)

What is the purpose of the Audit Data Standards?

A) To provide a guide to standardize audit data requests B) To increase the cost of audits C) To help auditors learn SQL code D) To create standardized data storage systems

126)

There are many times when using SQL is the best option for extracting data, but sometimes it is not preferred. Which of the following is an example of when SQL would NOT be a preferred method of data extraction?

A) When the data is already stored in Excel B) When the data is stored across different tables in a relational database C) When the data in the table you wish to analyze is too large for Excel’s resources D) When you wish to extract precise attributes and records that fit your criteria

127)

What is one of Excel’s tools for joining data from two separate spreadsheets?

A) SUMIF B) VLOOKUP C) SQL D) DATAREQUEST

128)

What is one of Excel’s tools is roughly equivalent to the VLOOKUP function?

A) INDEX/MATCH B) SELECT C) LINK D) LINKUP

129)

What follows the ETL process of “Validating the Data”?

A) Loading the Data for Analysis B) Obtain the data C) Determining the scope of the data request D) Cleaning the data

130)

What follows the ETL process of “Obtaining the Data”?

A) Loading the Data for Analysis B) Obtain the data C) Validating the data for completeness and integrity D) Cleaning the data

Answer Key Test name: chapter 2 1) TRUE 2) TRUE 3) FALSE 4) TRUE 5) TRUE 6) FALSE 7) TRUE 8) FALSE 9) FALSE 10) TRUE 11) TRUE 12) TRUE 13) FALSE 14) TRUE 15) TRUE 16) TRUE 17) TRUE 18) B 19) A 20) C 21) A 22) C 23) A 24) B 25) D 26) A 27) C 28) C 29) C 30) C 31) A 32) A 33) C 34) D 35) A 36) C 37) D

38) B 39) B 40) A 41) B 42) A 43) A 44) B 45) D 46) D 47) D 48) A 49) A 50) Essay 51) Essay 52) Essay 53) Essay 54) Essay 55) A 56) A 57) D 58) A 59) A 60) B 61) A 62) D 63) C

Student name:__________ 131)

132)

The P in IMPACT Cycle represents performing test plan. ⊚ true ⊚ false

Data reduction is a data approach used to reduce the amount of information that needs to be considered to focus on the most critical items. ⊚ true ⊚ false

133)

Regression is a data approach used to estimate or predict, for each unit, the numerical value of some variable using some type of statistical model. ⊚ true ⊚ false

134)

Link prediction is a data approach used to estimate or predict, for each unit, the numerical value of some variable using some type of statistical model. ⊚ true ⊚ false

135)

Co-occurrence grouping could be used to match vendors by geographic region. ⊚ true ⊚ false

136)

Fuzzy matching is a data approach used to identify similar fields that may indicate a match between records. ⊚ true ⊚ false

137)

Alibaba and its attempt to identify seller and customer fraud based on various characteristics known about them is an example of similarity matching. ⊚ true ⊚ false

138)

An example of classification would be a credit card company flagging a transaction as being approved or potentially being fraudulent and denying payment. ⊚ true ⊚ false

139)

When considering a question such as "Do our customers form natural groups based on similar attributes?" you would use an unsupervised approach. ⊚ true ⊚ false

140)

Co-occurrence grouping is an example of a supervised approach. ⊚ true ⊚ false

141)

The data approach used to characterize the typical behavior of an individual, group or population by generating summary statistics about the data is referred to as classification. ⊚ true ⊚ false

142)

XBRL is used to facilitate the exchange of financial reporting information between the company and the Securities and Exchange Commission. ⊚ true ⊚ false

143)

Benford’s Law is an absolute and all data must conform. ⊚ true ⊚ false

144)

Clustering is a data approach used to divide individuals into groups in a useful or meaningful way. ⊚ true ⊚ false

145)

Data profiling typically involves unstructured data. ⊚ true ⊚ false

146)

A decision tree can be used to divide data into smaller groups. ⊚ true ⊚ false

147)

Existing data that have been manually evaluated and assigned a class is often referred to as test data. ⊚ true ⊚ false

148)

Fuzzy matching is a computer-assisted technique of finding matches that are less than 100 percent perfect by finding correspondences between portions of the text of each potential match. ⊚ true ⊚ false

149)

A target is a manually assigned category applied to a record based on an event. ⊚ true ⊚ false

150)

All of the following are examples of a supervised approach to evaluation data except: A) Causal modeling B) Data reduction C) Link prediction D) Regression

151)

Diagnostic analytics include all of the following except: A) Similarity matching B) Clustering C) Profiling D) All of the choices are correct

152)

The global standard for exchanging financial reporting information that uses XML is called__________.

A) XBRL B) XFRL C) Yahoo! Finance D) Bloomberg

153)

The acronym XBRL stands for__________.

A) eXtensible Business Reporting Language B) eXtensive Business Reporting Language C) eXtensive Business Reporting Lingo D) eXtensive Business Reporting Language

154)

Financial statements are tagged according to the XBRL__________ that links it to common universal definitions.

A) links B) taxonomy C) data dictionary D) term sheet

155)

Which of the following best describes an unsupervised approach to the evaluation of data?

A) Data exploration that is free from oversight by a superior B) Data exploration to examine the relationships between variables that are hypothesized to exist C) Data exploration looking for potential patterns of interest D) Data exploration that is conducted with direct oversight by a superior

156)

157)

Which of the following best describes a supervised approach to the evaluation of data?

A) Data exploration that is free from oversight by a superior B) Data exploration that is conducted with direct oversight by a superior C) Data exploration to examine the relationships between variables that are hypothesized to exist D) Data exploration looking for potential patterns of interest

Which approach to data analytics attempts to assign each unit in a population into a small set of categories?

A) Classification B) Regression C) Similarity matching D) Co-occurrence grouping

158)

Which approach to data analytics attempts to divide individuals into groups in a useful or meaningful way?

A) Clustering B) Data reduction C) Similarity matching D) Co-occurrence grouping

159)

The__________ statistical concept that assigns a value to a number based on how many standard deviations it stands from the mean?

A) z-score B) F-score C) q-score D) median

160)

The cutoff for the second quartile of a distribution is its__________.

A) mean B) 75th percentile th C) 25 percentile D) median

161)

Which approach to data analytics attempts to identify similar individuals based on data known about them?

A) Classification B) Clustering C) Similarity matching D) Co-occurrence grouping

162)

Which approach to data analytics attempts to discover associations between individuals based on transactions involving them?

A) Classification B) Regression C) Similarity matching D) Co-occurrence grouping

163)

Which approach to data analytics attempts to forecast a relationship between two data items?

A) Link prediction B) Regression C) Similarity matching D) Co-occurrence grouping

164)

Which approach to data analytics attempts to predict, for each unit, the numerical value of some variable?

A) Classification B) Regression C) Similarity matching D) Link prediction

165)

Which approach to data analytics attempts to characterize the typical behavior of an individual, group or population by generating summary statistics about the data?

A) Classification B) Regression C) Profiling D) Link prediction

166)

Using social media to look for relationships between related parties that are not otherwise disclosed to identify related party transactions is an example of __________.

A) Classification B) Regression C) Profiling D) Link prediction

167)

Short surveys regarding dining preferences, sometimes requested at the bottom of a restaurant bill, are an attempt to collect data that will facilitate which data approach?

A) Clustering B) Regression C) Similarity matching D) Link prediction

168)

What is the analytics type for procedures that explore the current data to determine why an outcome has happened?

A) Prescriptive B) Predictive C) Diagnostic D) Descriptive

169)

What is the analytics type for procedures that work to identify the best possible options given constraints or changing conditions?

A) Prescriptive B) Predictive C) Diagnostic D) Descriptive

170)

What is the analytics type for procedures that summarize existing data to determine what has happened in the past?

A) Prescriptive B) Predictive C) Diagnostic D) Descriptive

171)

The decision support systems approach is most associated with the__________ analytics type.

A) Prescriptive B) Predictive C) Diagnostic D) Descriptive

172)

Retail stores often request customers' zip codes at the end of a sales transaction. This is an example of which data approach?

A) Clustering B) Regression C) Similarity matching D) Classification

173)

Data reduction typically involves the following steps except: A) Identify the attribute you would like to reduce to focus on more relevant fields.

B) Identify the parameters of the model.

C) Filter the results.

D) Interpret the results.

174)

Data profiling is used to assess data quality and internal controls and typically involves the following steps except: A) Filter the results.

B) Identify the objects or activity you want to profile.

C) Determine the types of profiling you want to perform.

D) Set boundaries or thresholds for the activity.

175)

Data that are stored in a database or spreadsheet that is readily searchable is called __________.

A) Training data B) Unstructured data C) Structured data D) Test data

176)

In many naturally occurring collections of numbers, the leading significant digit is likely to be small is called __________.

A) Leading digits hypothesis B) Moore's law C) Benford's law D) Classification

177)

Unaware of data analysis tools available to the internal auditors, a store employee frequently processes cash returns without a receipt for $99, which is just below the amount requiring manager approval of $100. An analysis using which of the following would likely (and quickly) identify the employee's fraudulent behavior.

A) Leading digits hypothesis B) Moore's law C) Benford's law D) Clustering

178)

Regression analysis typically involves the following steps except: A) Identify the variables that might predict an outcome.

B) Identify the parameters of the model.

C) Set boundaries or thresholds.

D) Determine the functional form of the relationship.

179)

Regression might be used to predict an interest rate given to borrower by the lender based on certain risk characteristics. In this regression, the dependent variable would be which of the following?

A) Risk characteristics.

B) Interest rate.

C) Demographic characteristics.

D) Loan acceptance.

180)

Regression might be used to predict an interest rate given to borrower by the lender based on certain risk characteristics. In this regression, potential independent variables would be which of the following?

A) Risk characteristics.

B) Interest rate.

C) Demographic characteristics.

D) Loan acceptance.

181)

When working with a predictive model, underfitting the data is most likely caused by __________.

A) an overly complex model B) an overly simple model C) over pruning the data D) a lack of data reduction

182)

In general, the more complex the model, the greater the chance of __________.

A) Overfitting the data B) Underfitting the data C) Pruning the data D) The need to reduce the amount of data considered

183)

While overfitting data could lead to an error rate of 0 (zero), it is unlikely that you would be able to __________ your results.

A) define B) specify C) articulate D) generalize

184)

Which of the following best describes an independent variable?

A) Output B) Input C) Application D) Operation

185)

Which of the following best describes a dependent variable?

A) Output B) Input C) Application D) Operation

186)

Understanding and predicting inventory obsolescence is an important determination for retail companies. When using competitor selling prices to estimate the inventory obsolescence reserve, the inventory obsolescence reserve represents which of the following: A) Independent variable B) Dependent variable C) Function D) Statistical Model

187)

Understanding and predicting warranty expense is an important determination for manufacturing firms. When using historical claims data to estimate the current period's warranty expense, the historical claims data represents which of the following: A) Independent variable B) Dependent variable C) Function D) Statistical Model

188)

One of the key tasks of auditors of a bank is to consider the amount of the loan loss reserve. When developing a model to estimate the current year's loan loss reserve amount, which of the following would be least likely to be included as an independent variable?

A) Original loan approval amount B) Customer loan history C) Current aged loans D) Collections success

189)

Training data are existing data that have been manually evaluated and assigned a class and __________ are existing data used to evaluate the model.

A) Control data B) Test data C) Unstructured data D) Structured data

190)

191)

The split between one class and another class is called: A) decision trees.

B) identifying questions.

C) decision boundaries.

D) linear classifiers.

What is the difference between structured data and unstructured data? Provide an example of each.

192)

Decision trees are used to divide data into smaller groups by splitting the data at each branch into two or more groups. However, this method could lead to unintended consequences if the decision tree is not pruned. Describe the pruning process, when it can occur and the benefits.

193)

Chapter 3 discusses four data analytics approaches that may be used to address our accounting questions. List and define the four data analytics approaches. Next, describe how each of the four data analytics approaches you list could be used by credit card companies to identify fraudulent credit card activity.

194)

Assume that you will be up for a promotion next month and you'd like to impress your boss with your data analytic skills. The company you work for normally books the current month's bad debit for the same amount as the prior month's actual accounts receivable writeoffs. Using your general accounting knowledge, explain why this process is not the best method. Next, assuming that you will use a regression analysis, explain the process and describe the data/information you would request/include to perform the analysis.

195)

Benford's Law (be sure to answer all 3 parts): Part A: Briefly describe Benford's Law. Part B: Draw a graph that exemplifies data which conforms to Benford's Law (i.e., what it should look like).

Part C: Briefly describe how auditors could utilize Benford's Law while conducting testwork.

Answer Key Test name: chapter 3 1) TRUE 2) TRUE 3) TRUE 4) FALSE 5) TRUE 6) FALSE 7) TRUE 8) TRUE 9) TRUE 10) FALSE 11) FALSE 12) TRUE 13) FALSE 14) TRUE 15) FALSE 16) TRUE 17) FALSE 18) TRUE 19) FALSE 20) B 21) D 22) A 23) A 24) B 25) C 26) C 27) A 28) A 29) A 30) D 31) C 32) D 33) A 34) B 35) C 36) D 37) A

38) C 39) A 40) D 41) A 42) A 43) B 44) A 45) C 46) C 47) C 48) C 49) B 50) A 51) B 52) A 53) D 54) B 55) A 56) B 57) A 58) A 59) B 60) C 61) Essay 62) Essay 63) Essay 64) Essay 65) Essay

Student name:__________ 196)

After completing data analysis, the write-up should include only the steps of the IMPACT model that are most significant. ⊚ true ⊚ false

197)

Qualitative data is categorical data. ⊚ true ⊚ false

198)

Nominal data is the simplest form of data. ⊚ true ⊚ false

199)

The primary statistic used with qualitative data is proportion. ⊚ true ⊚ false

200)

Both nominal and ordinal data can also be referred to as data-driven. ⊚ true ⊚ false

201)

If you are comparing two datasets that follow the normal distribution, even if the two datasets have very different means, you can still compare them by standardizing the distributions with Z-scores. ⊚ true ⊚ false

202)

Ratio data is considered the most sophisticated type of data. ⊚ true ⊚ false

203)

Interval data is more sophisticated than ratio data. ⊚ true ⊚ false

204)

Continuous data is data that can take on any value within a range. ⊚ true ⊚ false

205)

Discrete data is data that can be represented by any number, including whole numbers and fractions. ⊚ true ⊚ false

206)

Declarative visualizations are the product of wanting to declare or present your findings to an audience. ⊚ true ⊚ false

207)

The charts most frequently considered for depicting quantitative data are bar charts, pie charts and stacked bar charts. ⊚ true ⊚ false

208)

Data visualizations should not be used to satisfy an exploratory purpose. ⊚ true ⊚ false

209)

There are very few methods for visualizing quantitative data. ⊚ true ⊚ false

210)

When work is completed with qualitative data, it will most frequently be visualized using the tools in Quadrant 1, the declarative, data-driven quadrant. ⊚ true ⊚ false

211)

The normal distribution is a phenomenon that many naturally occurring datasets in our world follow. ⊚ true ⊚ false

212)

The value of 0 in interval data is simply another number on the scale. ⊚ true ⊚ false

213)

1st place, 2nd place, and 3rd place would be best described as an example of: A) Nominal data B) Ordinal data C) Structured data D) Interval data

214)

The four chart types include quantitative, qualitative, exploratory and: A) diagnostic data.

B) descriptive data.

C) expository data.

D) declarative data.

215)

Red, Yellow, and Blue would be best described as an example of: A) nominal data.

B) ordinal data.

C) structured data.

D) continuous data.

216)

Letter grades of A, B, and C would be best described as an example of: A) nominal data.

B) ordinal data.

C) ratio data.

D) interval data.

217)

Polar bears, brown bears, black bears, and panda bears would be best described as an example of: A) nominal data.

B) ordinal data.

C) ratio data.

D) interval data.

218)

Latitude and longitude would be best described as an example of: A) nominal data.

B) ordinal data.

C) ratio data.

D) discrete data.

219)

The following are typical examples of nominal data except: A) grade point average.

B) zip codes.

C) eye color.

D) gender.

220)

The following are typical examples of nominal data except: A) marital status.

B) state of residency.

C) temperature.

D) nationality.

221)

The following are typical examples of nominal data except: A) hair color.

B) eye color.

C) gender.

D) height.

222)

The following are typical examples of ordinal data except: A) distance.

B) position in a race.

C) hardness of a mineral.

D) military rank.

223)

The following are typical examples of ordinal data except: A) blood type by population.

B) political affiliation.

C) education level.

D) letter grade.

224)

The following are typical examples of ratio data except: A) currency.

B) temperature.

C) length.

D) weight.

225)

The following are typical examples of ratio data except: A) weight.

B) birth date.

C) height.

D) pulse rate.

226)

Results using the Fahrenheit scale would be best described as an example of: A) nominal data.

B) ordinal data.

C) ratio data.

D) interval data.

227)

The following are typical examples of interval data except: A) time.

B) temperature.

C) standardized exam score.

D) type of car owned.

228)

The following are characteristics of interval data except: A) measured.

B) ordered.

C) equidistant.

D) meaningful zero.

229)

The standard normal distribution has a: A) mean of 0 and a standard deviation of 1.

B) mean of 1 and a standard deviation of 1.

C) mean of 1 and a standard deviation of 0.

D) mean of 0 and a standard deviation of 0.

230)

In a standard normal distribution, if the mean of the distribution is 0, then the median and mode equal__________.

A) −1 B) 0 C) 1 D) cannot be determined

231)

SAT scores, IQ scores, and heights and weights of newborn babies follow a: A) normal distribution.

B) standard normal distribution.

C) poisson distribution.

D) cannot be determined.

232)

Data that is represented by whole numbers is called: A) continuous data.

B) discrete data.

C) interval data.

D) ordinal data.

233)

Visualizations that present findings to an audience are called: A) declarative visualizations.

B) static visualizations.

C) exploratory visualizations.

D) interactive visualizations.

234)

The following chart types are preferred for depicting qualitative data except a: A) line chart.

B) pie chart.

C) bar chart.

D) stacked bar chart.

235)

The following chart types are preferred for depicting quantitative data except: A) scatter plots.

B) box plots.

C) line chart.

D) pie chart.

236)

The chart below is an example of a:

A) B) C) D)

word map. word cloud. word chart. word plot.

237)

Which of the following charts best visualizes a Bar chart?

A)

B)

C)

D)

238)

Which type of chart is preferred for when quartiles, median, and outliers are required for analysis and insights?

A) Scatter plots B) Box and whisker plots C) Line chart D) Pie chart

239)

Which type of chart is best described as useful for identifying the correlation between two variables, for identifying a trend line, or line of best fit?

A) Scatter plots B) Box and whisker plots C) Line chart D) Pie chart

240)

When considering the color theme for a visualization, which is the best color theme for a color blind audience?

A) Orange/blue scale B) Red/green scale C) Gray scale D) Red/blue scale

241)

Which of the following is not an example of continuous data?

A) Meters swam in 25 minutes B) Miles run in 25 minutes C) Free throws made in 25 minutes D) Laps biked in 25 minutes

242)

Which of the following is not an example of discrete data?

A) Points earned in a basketball game B) Points earned in a hockey game C) Points earned in a diving match D) Points earned in a soccer game

243)

Quantitative data is more complex than: A) exploratory data.

B) qualitative data.

C) test data.

D) training data.

244)

Which of the following is not one of the four main questions to consider when creating your data scale and increments?

A) How much data should be displayed in the visualization?

B) Should outliers be displayed?

C) What scale should be used to display the data?

D) Which colors should be displayed?

245)

After completing your data analysis, the write-up should include a discussion of which of the following?

A) Only the steps of the IMPACT model you consider important B) Only the steps of the IMPACT model your client will understand C) All steps of the IMPACT model D) All steps of the IMPACT model your client will understand

246)

As discussed in the book and consistent with the writings of author Justin Zobel, your written business communications should be directed towards: A) your supervisor.

B) your reviewer.

C) your audience.

D) your customer.

247)

Which type of data and visualizations are used for presenting findings to your audience and are more often associated with traditional data visualizations?

A) Conceptual B) Declarative C) Exploratory D) Quantitative

248)

Which type of data and visualizations are used for gaining insights and generating ideas while interacting with your data?

A) Conceptual B) Declarative C) Exploratory D) Quantitative

249)

Which charts work best for depicting proportion?

A) Pie Chart and Stacked Bar Chart B) Pie Chart and Line Chart C) Line Chart and Word Cloud D) Bar Chart and Box and Whisker Plot

250)

Which chart work best for depicting progression over time?

A) Pie Chart B) Line Chart C) Word Cloud D) Box and Whisker Plot

251)

What is the preferred number to start a scale at in a bar chart?

A) 0 B) 5 numbers below the lowest number in your dataset C) The lowest number in your dataset D) The median of your dataset

252)

Which of the following is not a tool you should use to maximize your charts for a colorblind audience?

A) Avoid a red/green color pallet B) Use a orange/blue color pallet C) Convert your chart to grayscale to check the constrast D) Use natural increments in your data scale such as 1s or 100s

253)

Which of the following is NOT true about crafting a written communication?

A) Take the opportunity to introduce new acronyms and jargon to your audience.

B) Consider the best way to provide the information to your intended audience.

C) Always place your audience as the focus of your writing to help you maintain an appropriate tone.

D) Prepare your audience for what’s next in your analysis, such as quarterly reports or specific trends to pay attention to over time.

254)

The percentage of individuals that prefer visual content over written content is: A) more than 90 percent.

B) less than 40 percent.

C) approximately 60 percent.

255)

On Facebook, the interaction rate of photos is__________; as compared to a 4 percent interaction rate for other types of posts, such as links or texts. suggesting a preference for visualizations over plain text.

A) more than 80 percent B) less than 40 percent C) approximately 50 percent

256)

Given that Anscombe’s Quartet showed the inherent difference between statistics and visualizations, how shall results be communicated to decision makers?

Answer Key Test name: chapter 4 1) FALSE 2) TRUE 3) TRUE 4) TRUE 5) FALSE 6) TRUE 7) TRUE 8) FALSE 9) TRUE 10) FALSE 11) TRUE 12) FALSE 13) FALSE 14) FALSE 15) FALSE 16) TRUE 17) TRUE 18) B 19) D 20) A 21) B 22) A 23) C 24) A 25) C 26) D 27) A 28) B 29) B 30) B 31) D 32) D 33) D 34) A 35) B 36) A 37) B

38) A 39) A 40) D 41) B 42) B 43) B 44) A 45) A 46) C 47) C 48) B 49) D 50) C 51) C 52) B 53) C 54) A 55) B 56) A 57) D 58) A 59) A 60) A 61) Essay

Student name:__________ 257)

A flat file is a single table of data with user-defined attributes. ⊚ true ⊚ false

258)

Heterogeneous systems represent one single installation or instance of a system. ⊚ true ⊚ false

259)

Production systems are those active systems that collect, report, and are directly affected by current transactions. ⊚ true ⊚ false

260)

Systems translator software maps the various tables and fields from varied ERP systems into a consistent format. ⊚ true ⊚ false

261)

Heterogeneous systems represent multiple installations or instances of a system. ⊚ true ⊚ false

262)

A data warehouse is a repository of data, including financial data, accumulated from internal and external data sources, to help management decision making. ⊚ true ⊚ false

263)

The Audit Data Standards define common tables and fields that are needed by auditors to perform common audit tasks. The Securities and Exchange Commission, or SEC, developed these standards. ⊚ true ⊚ false

264)

265)

A flat file is a double table of data with user-defined attributes. ⊚ true ⊚ false

Production systems are those active systems that collect, report, and are directly affected by future transactions. ⊚ true ⊚ false

266)

Systems translator software maps the various tables and fields from varied EMR systems into a consistent format. ⊚ true ⊚ false

267)

The Base Standard of the AICPA Audit Data Standards defines the order for files and fields as well as some master data for users and business units. ⊚ true ⊚ false

268)

The Inventory Subledger Standard of the AICPA Audit Data Standards defines product master data, location data, inventory on hand data, and inventory movement. ⊚ true ⊚ false

269)

The General Ledger Standard of the AICPA Audit Data Standards adds the chart of accounts, source listings, trial balance, and GL detail. ⊚ true ⊚ false

270)

The Procure to Pay Subledger Standard of the AICPA Audit Data Standards identifies data needed for purchase orders, goods received, invoices, payments, and adjustments to accounts. ⊚ true ⊚ false

271)

The Order to Cash Subledger Standard of the AICPA Audit Data Standards focuses on sales orders, accounts receivable, shipments, invoices, cash receipts and adjustments to accounts. ⊚ true ⊚ false

272)

An audit plan consists solely of a methodology which directs the audit work and includes substantive testing. ⊚ true ⊚ false

273)

Both simple and complex data analytics can be applied to a client’s data during the planning stage of the audit to identify which areas the auditor should focus on. ⊚ true ⊚ false

274)

The evaluation of audit data may be distilled into a feasibility score. ⊚ true ⊚ false

275)

Data analytics and audit automation allow auditors to occasionally monitor and ignore the systems and processes within their companies. ⊚ true ⊚ false

276)

Continuous auditing is a process that provides real-time assurance over business processes and systems. ⊚ true ⊚ false

277)

Under the guidance of the chief audit executive (CAE) or another manager, teams can develop and implement analytical techniques to aid the following audits except: A) information systems audits.

B) social media audits.

C) compliance audits.

D) forensic audits in the case of fraud.

278)

Under the guidance of the chief audit executive (CAE) or another manager, teams can develop and implement analytical techniques to aid the following audits except: A) financial statement audits.

B) archaic audits.

C) process efficiency audits.

D) forensic audits.

279)

Under the guidance of the chief audit executive (CAE) or another manager, teams can develop and implement analytical techniques to aid the following audits except: A) governance audits.

B) risk audits.

C) management audits.

D) compliance audits.

280)

Which Accounting Data Standard identifies data needed for purchase orders, goods received, invoices, payments, and adjustments to accounts?

A) B) C) D)

Base Standard General Ledger Standards Procure to Pay Subledger Standard Inventory Subledger Standard

281)

Which Accounting Data Standard identifies product master data, location data, inventory on hand data, and inventory movement?

A) Base Standard B) General Ledger Standards C) Procure to Pay Subledger Standard D) Inventory Subledger Standard

282)

Which Accounting Data Standard focuses on sales orders, accounts receivable, shipments, invoices, cash receipts and adjustments to accounts?

A) General Ledger Standards B) Order to Cash Subledger C) Procure to Pay Subledger Standard D) Inventory Subledger Standard

283)

Which Accounting Data Standard defines the format for files and fields as well as some master data for users and business units?

A) Base Standard B) General Ledger Standards C) Order to Cash Subledger D) Procure to Pay Subledger Standard

284)

Which Accounting Data Standard includes the chart of accounts, source listings, trial balance, and GL (journal entry) detail?

A) Base Standard B) General Ledger Standards C) Order to Cash Subledger D) Procure to Pay Subledger Standard

285)

Which of the following best defines the Accounting Data Standards: Inventory Subledger?

A) Focuses on sales orders, accounts receivable, shipments, invoices, cash receipts and adjustments to accounts.

B) Identifies data needed for purchase orders, goods received, invoices, payments, and adjustments to accounts.

C) Adds the chart of accounts, source listings, trial balance, and GL (journal entry) detail.

D) Defines product master data, location data, inventory on hand data, and inventory movement.

286)

Which of the following best defines the Accounting Data Standards: Procure to Pay Subledger?

A) Focuses on sales orders, accounts receivable, shipments, invoices, cash receipts and adjustments to accounts.

B) Identifies data needed for purchase orders, goods received, invoices, payments, and adjustments to accounts.

C) Adds the chart of accounts, source listings, trial balance, and GL (journal entry) detail.

D) Defines product master data, location data, inventory on hand data, and inventory movement.

287)

Which of the following best defines the Accounting Data Standards: Order to Cash Subledger?

A) Focuses on sales orders, accounts receivable, shipments, invoices, cash receipts, and adjustments to accounts.

B) Identifies data needed for purchase orders, goods received, invoices, payments, and adjustments to accounts.

C) Adds the chart of accounts, source listings, trial balance, and GL (journal entry) detail.

D) Defines product master data, location data, inventory on hand data, and inventory movement.

288)

Which of the following best defines the Accounting Data Standards: General Ledger?

A) Focuses on sales orders, accounts receivable, shipments, invoices, cash receipts and adjustments to accounts.

B) Identifies data needed for purchase orders, goods received, invoices, payments, and adjustments to accounts.

C) Adds the chart of accounts, source listings, trial balance, and GL (journal entry) detail.

D) Defines the format for files and fields as well as some master data for users and business units.

289)

Which of the following best defines the Accounting Data Standards: Base Standard?

A) Focuses on sales orders, accounts receivable, shipments, invoices, cash receipts and adjustments to accounts.

B) Identifies data needed for purchase orders, goods received, invoices, payments, and adjustments to accounts.

C) Adds the chart of accounts, source listings, trial balance, and GL (journal entry) detail.

D) Defines the format for files and fields as well as some master data for users and business units.

290)

Which of the following describes a homogenous systems approach?

A) Ensures that all of its divisions and subsidiaries use a uniform installation of the chosen ERP system.

B) Allows all divisions and subsidiaries use the ERP system that works best for each location.

C) Provides a single table of data with user-defined attributes that is stored separate from any application.

D) Maps the various tables and fields from multiple ERP systems.

291)

Which of the following describes an example of a flat file?

A) Ensures that all of its divisions and subsidiaries use a uniform installation of the chosen ERP system.

B) Allows all divisions and subsidiaries use the ERP system that works best for each location.

C) Provides a single table of data with user-defined attributes that is stored separate from any application.

D) Maps the various tables and fields from multiple ERP systems.

292)

Which of the following describes an example of a production system?

A) Collects, reports, and is directly affected by current transactions.

B) Allows all divisions and subsidiaries to use the ERP system that works best for each location.

C) Provides a single table of data with user-defined attributes that is stored separately from any application.

D) Maps the various tables and fields from multiple ERP systems.

293)

Which of the following describes a heterogeneous system approach?

A) Ensures that all of its divisions and subsidiaries use a uniform installation of the chosen ERP system.

B) Allows all divisions and subsidiaries to use the ERP system that works best for each location.

C) Provided a single table of data with user-defined attributes that is stored separately from any application.

D) Maps the various tables and fields from multiple ERP systems.

294)

Which of the following is an example of systems translator software?

A) Collects, reports, and is directly affected by current transactions.

B) Allows all divisions and subsidiaries to use the ERP system that works best for each location.

C) Provides a single table of data with user-defined attributes that is stored separately from any application.

D) Maps the various tables and fields from multiple ERP systems.

295)

Which of the following ensures that all of its divisions and subsidiaries use a uniform installation of one ERP system?

A) Continuous reporting.

B) Continuous monitoring.

C) The heterogeneous systems approach.

D) The homogenous systems approach.

296)

Which of the following allows for the use of bolt on systems of companies that are acquired and uses a series of translators to convert the output of various systems into usable financial information?

A) Continuous reporting.

B) Continuous monitoring.

C) The heterogeneous systems approach.

D) The homogenous systems approach.

297)

298)

Which of the following constantly evaluates internal controls and transactions?

A) Continuous reporting.

B) Continuous monitoring.

C) The heterogeneous systems approach.

D) The homogenous systems approach.

Which of the following provides the status of the system so that an auditor can know at any given time whether the system is operating within the parameters?

A) Continuous reporting B) Continuous monitoring C) The heterogeneous systems approach D) The homogenous systems approach

299)

Continuous auditing relies heavily on alarms, which are essentially notifications of a classification problem. What occurs when too many alarms are false positives?

A) Flood of alarms.

B) Exception report.

C) A negative event.

D) Data warehouse.

300)

Continuous auditing relies heavily on alarms, which are essentially notifications of a classification problem. What occurs when a normal transaction is classified as problematic?

A) False negative.

B) True negative.

C) True positive.

D) False positive.

301)

Continuous auditing relies heavily on alarms, which are essentially notifications of a classification problem. What occurs when an abnormal transaction is classified as problematic?

A) False negative.

B) True negative.

C) True positive.

D) False positive.

302)

Continuous auditing relies heavily on alarms, which are essentially notifications of a classification problem. What occurs when a normal transaction is not classified as problematic?

A) False negative.

B) True negative.

C) True positive.

D) False positive.

303)

Continuous auditing relies heavily on alarms, which are essentially notifications of a classification problem. What is an abnormal transaction that is not classified as problematic?

A) False negative.

B) True negative.

C) True positive.

D) False positive.

304)

A repository of data accumulated from internal and external data sources, including financial data, to help management decision making is called a: A) flat file.

B) data warehouse.

C) homogenous system.

D) heterogeneous system.

305)

A tool used to map existing database tables and fields from various systems to a standardized set of tables and fields for use with analytics is called a: A) database diagram.

B) common data model.

C) data dictionary.

D) data warehouse.

306)

Chapter 5 discusses the essential properties of working papers. With respect to data analytics, working papers should contain the following items except: A) work programs used to document the audit procedures to collect, manipulate, model, and evaluate data.

B) evidence, including performance evaluations, of the competency of the auditors completing the working paper.

C) database maps and data dictionaries that define the location and types of data auditors will analyze.

D) documentation about existing automated controls, including parameters and variables used for analysis.

307)

Chapter 5 discusses the essential properties of working papers. With respect to data analytics, working papers should contain the following items except: A) work programs used to document the audit procedures to collect, manipulate, model, and evaluate data.

B) evidence, including data extracts, transformed data, and model output that provides support for the functioning controls and management assertions.

C) superseded drafts of working papers or financial statements, notes that reflect incomplete or preliminary thinking, previous copies of documents corrected for typographical or other errors, and duplicates of documents.

D) documentation about existing automated controls, including parameters and variables used for analysis.

308)

Chapter 5 discusses the essential properties of working papers. With respect to data analytics, working papers should contain the following items except: A) work programs used to document the audit procedures to collect, manipulate, model, and evaluate data.

B) IT-related documentation, including flowchart and process maps that provide system understanding.

C) database maps and data dictionaries that define the location and types of data auditors will analyze.

D) memos to future auditors documenting issues with problem members of the client’s management team.

309)

Chapter 5 discusses the essential properties of working papers. With respect to data analytics, working papers should contain the following items except: A) work programs used to document the audit procedures to collect, manipulate, model, and evaluate data.

B) IT-related documentation, including flowchart and process maps that provide system understanding.

C) database maps and data dictionaries that define the location and types of data auditors will analyze.

D) documentation of every matter considered during the audit.

310)

Under the guidance of the chief audit executive (CAE) or another manager, teams can develop and implement analytical techniques to aid the following audits except: A) governance audits.

B) risk audits.

C) security audits.

D) forensic audits.

311)

Microsoft Teams or Slack are examples of: A) collaboration tools.

B) electronic workpaper platforms.

C) audit evidence tools.

D) audit testing tools.

312)

TeamMate or Xero are examples of: A) collaboration tools.

B) electronic workpaper platforms.

C) audit evidence tools.

D) audit testing tools.

313)

PWC uses all but the following systems to automate its audit process?

A) Halo B) Sky C) Aura D) Connect

314)

Working papers should include all but the following items (as they relate to data analytics).

A) Work programs B) IT-related documentation C) Algorithms used in analysis D) Data extracts

315)

Working papers should include all but the following items (as they relate to data analytics).

A) Regression algorithms used in analysis B) Documentation about existing automated controls C) Database maps D) Evidence including data extracts

316)

All of the following are standards used in an audit methodology except: A) PCAOB B) COBIT C) COSO D) FASAC

317)

The__________ of the audit defines parameters that will be used to filter the records or transactions being evaluated.

A) scope B) methodology C) plan D) IMPACT model

318)

The__________ of the audit consists of a methodology, the scope of the audit, the potential risk areas, and procedures and specific tasks the audit team will execute.

A) formal evaluation B) procedures and specific tasks C) plan D) IMPACT model

319)

The__________ included in the audit plan typically include tests of controls and substantive tests of transaction details.

A) procedures and specific tasks B) methodology C) scope D) potential risk areas

Answer Key Test name: chapter 5 1) TRUE 2) FALSE 3) TRUE 4) TRUE 5) TRUE 6) TRUE 7) FALSE 8) FALSE 9) FALSE 10) FALSE 11) FALSE 12) TRUE 13) TRUE 14) TRUE 15) TRUE 16) FALSE 17) TRUE 18) FALSE 19) FALSE 20) TRUE 21) B 22) B 23) C 24) C 25) D 26) B 27) A 28) B 29) D 30) B 31) A 32) C 33) D 34) A 35) C 36) A 37) B

38) D 39) D 40) C 41) B 42) A 43) A 44) D 45) C 46) B 47) A 48) B 49) B 50) B 51) C 52) D 53) D 54) C 55) A 56) B 57) B 58) C 59) A 60) D 61) A 62) C 63) A

Student name:__________ 320)

321)

A sales order ID is a unique identifier for each purchase order. ⊚ true ⊚ false

A business unit code is used to identify the business unit, region, and branch at the level that financial statements are being reconciled. ⊚ true ⊚ false

322)

A customer account ID identifies the customer from whom payment is expected or to whom unused credits have been applied. ⊚ true ⊚ false

323)

Descriptive analytics summarize activity or master data elements based on certain attributes. ⊚ true ⊚ false

324)

The auditor may select a sample of new customer accounts to verify that they were opened the appropriate documentation exists. ⊚ true ⊚ false

325)

Once an auditor has a basic understanding of the data, diagnostic analytics are performed to look for differences or patterns of interest in the data. ⊚ true ⊚ false

326)

An auditor will perform predictive analytics before diagnostic analytics. ⊚ true ⊚ false

327)

Prescriptive analytics identify a course of action for the auditor to take based on the actions taken in similar situations in the past. ⊚ true ⊚ false

328)

Sampling is useful when you have manual audit procedures, such as testing transaction details or evaluating source documents. ⊚ true ⊚ false

329)

Monetary unit sampling allows auditors to mitigate risk. ⊚ true ⊚ false

330)

Benford’s Law predicts the distribution of first digits. ⊚ true ⊚ false

331)

Exact matching is a way in which auditors join database tables with a foreign key from one table to the secondary key of another. ⊚ true ⊚ false

332)

Sequence checks are useful for finding gaps in items that should be sequential in nature (i.e., check number) or for finding duplicate values for items that should be unique in nature (i.e., duplicate payments to vendors). ⊚ true ⊚ false

333)

Regression allows an auditor to predict a specific dependent value based on independent variable inputs. ⊚ true ⊚ false

334)

335)

Classification in auditing is typically focused on risk assessment. ⊚ true ⊚ false

Sorting in descending order shows the smallest number values first. Sorting in ascending order shows the largest values first. ⊚ true ⊚ false

336)

Summary statistics provide insight into the relative size of a number compared with the population. ⊚ true ⊚ false

337)

A fuzzy match is based on the similarity of the values. ⊚ true ⊚ false

338)

Artificial intelligence is designed around the idea that computers can learn about action or behavior from the past and predict the course of action for the present. ⊚ true ⊚ false

339)

Which of the following statements is true?

A) Monetary unit sampling more likely to pull accounts with small balances.

B) Monetary unit sampling allows auditors to evaluate account balances.

C) Prescriptive analytics attempt to find hidden patterns or variables.

D) Predictive analytics use machine learning and artificial intelligence.

340)

Which of the following statements is false?

A) Predictive analytics attempt to find hidden patterns or variables.

B) Regression allows an auditor to predict a specific dependent value based on independent variable inputs.

C) Classification in auditing is mainly focused on risk assessment.

D) Monetary unit sampling more likely to pull accounts with small balances.

341)

When working with CAATs, which of the following statements is false?

A) Inner join will show only the records from both tables that match and exclude everything that doesn’t match.

B) Left join will show all records from the first table and only records from the second table that match.

C) Right join will show all records from the second table and records from the first table that match.

D) Outer join will show all records, including only matching ones.

342)

Which of the following is the best choice as the unique identifier for each sales order?

A) Item# B) Shipping# C) Purchase_Order# D) Sales_Order#

343)

Which of the following is an example of descriptive analytics?

A) Summary statistics B) Z-score C) Similarity matching D) Fuzzy matching

344)

Which of the following is not an example of descriptive analytics?

A) Drill-down B) Age analysis C) Sampling D) Sorting

345)

Which of the following is an example of predictive analytics?

A) Classification B) Z-score C) Decision support systems D) Diagnostic

346)

Which of the following is not an example of predictive analytics?

A) Classification B) Regression C) Probability D) Artificial intelligence

347)

Which type of audit analytics might be used to summarize activity or master data based on certain attributes?

A) Prescriptive analytics B) Predictive analytics C) Diagnostic analytics D) Descriptive analytics

348)

Which type of audit analytics might be used to detect correlations and patterns of interest?

A) Prescriptive analytics B) Predictive analytics C) Diagnostic analytics D) Descriptive analytics

349)

Which type of audit analytics might be used to identify common attributes or patterns that may be used to identify similar activity?

A) Prescriptive analytics B) Predictive analytics C) Diagnostic analytics D) Descriptive analytics

350)

Which type of audit analytics might be used to recommend action based on previously observed actions?

A) Prescriptive analytics B) Predictive analytics C) Diagnostic analytics D) Descriptive analytics

351)

Grouping balances by date is referred to as __________ and is an example of descriptive analytics.

A) summary statistics B) age analysis C) monetary unit sampling D) sorting

352)

Identify largest or smallest values is referred to as __________ and is an example of descriptive analytics.

A) summary statistics B) age analysis C) monetary unit sampling D) sorting

353)

What computer-assisted audit technique allows auditors to evaluate account balances and is an example of descriptive analytics?

A) Summary statistics B) Monetary unit sampling C) Sorting D) Random sampling

354)

Assigning a value to a number based on how many standard deviations it stands from its mean is called __________.

A) A Z-score B) a T-test C) regression analysis D) classification analysis

355)

Exploring the details behind the values is referred to as __________.

A) regression analysis B) clustering C) drill-down D) classification analysis

356)

The identification of transactions or users with non-typical activity based on the distribution of first digits and is called: A) a drill-down.

B) fraud detection.

C) Benford’s Law. D) monetary unit sampling.

357)

Detecting gaps in records and duplicate entries is referred to as __________.

A) sequence check B) stratification C) gap analysis D) Benford’s law

358)

Grouping records by non-obvious similarities is referred to as __________.

A) clustering B) regression C) classification D) stratification

359)

Predicting specific dependent values based on independent variable inputs is referred to as __________.

A) correlation B) regression C) classification D) time series

360)

Using a rank score to evaluate the strength of classification is referred to as probability and is an example of __________ analytics.

A) diagnostic B) descriptive C) prescriptive D) predictive

361)

Evaluating the tone of text to forecast an outcome is referred to as sentiment analysis and is an example of __________ analytics.

A) diagnostic B) descriptive C) prescriptive D) predictive

362)

An example of predictive analytics that uses observations of behavior or past actions to predict the course of action for the future is referred to as: A) artificial intelligence B) regression C) classification D) what-if analysis

363)

Which of the following z-scores is likely an outlier that warrants further scrutiny?

A) −2.1 B) 0.0 C) 1.75 D) 3.2

364)

Which testing approach is useful to determine procedures to follow when new credit accounts are opened for inactive customers?

A) Applied statistics B) Regression C) Fuzzy matching D) Classification

365)

Large training sets are needed to generate relatively accurate models when using which type of approach?

A) Descriptive B) Regression C) Classification D) Diagnostic

366)

Which of the following is an example of a decision support system?

A) IDEA B) MS Excel C) TurboTax D) TeamMate Analytics

367)

Benford’s Law states that: A) common tables and fields are needed by auditors to perform common audit tasks.

B) analytics must be used to looks for correlations or patterns of interest in the data.

C) the number of transistors in a dense integrated circuit doubles approximately every two years.

D) in naturally occurring collections of numbers, the leading significant digit is likely to follow a theoretical distribution.

368)

Unaware of data analysis tools available, a sales person frequently processes lunch reimbursements without a receipt for between $9.50 − $9.98, which is just below the amount requiring a receipt of $10. An analysis using which of the following would likely (and quickly) identify the salesperson's possible fraudulent behavior.

A) Leading digits hypothesis B) Moore’s law C) Benford’s law D) Clustering

369)

The objectives of the audit and outputs generated by the business processes reflect the __________ of the audit.

A) nature B) extent C) timing D) analysis

370)

The prevalence of data has expanded the __________ of the audit.

A) nature B) extent C) timing D) analysis

371)

Analytics run on a schedule at certain points in the audit reflects the __________ of the audit.

A) nature B) extent C) timing D) analysis

372)

CAATs are: A) manual procedures B) infrequently used in audit practice C) computer algorithmic audit techniques D) automated scripts that re-perform calculations

373)

Identify three different descriptive analytics that are used in an audit setting and describe how they can help decision makers.

374)

Identify three different diagnostic analytics that are used in an audit setting and describe how they can help decision makers.

Answer Key Test name: chapter 6 1) FALSE 2) FALSE 3) TRUE 4) TRUE 5) TRUE 6) FALSE 7) FALSE 8) TRUE 9) TRUE 10) FALSE 11) TRUE 12) FALSE 13) TRUE 14) TRUE 15) TRUE 16) FALSE 17) TRUE 18) TRUE 19) FALSE 20) B 21) D 22) D 23) D 24) A 25) A 26) A 27) D 28) D 29) C 30) B 31) A 32) B 33) D 34) B 35) A 36) C 37) C

38) A 39) A 40) B 41) D 42) D 43) A 44) D 45) A 46) C 47) C 48) D 49) C 50) A 51) B 52) C 53) D 54) Essay 55) Essay

Student name:__________ 375)

Data analytics is the process of measuring past performance while comparing it to targeted goals to better evaluate a company's progress. ⊚ true ⊚ false

376)

377)

Performance metrics can be used to determine competence. ⊚ true ⊚ false

Data analytics enhances a business's ability to determine gaps in actual company performance and even the potential to transform the manner in which a company runs their business. ⊚ true ⊚ false

378)

Data visualization is an effective way to communicate the result of any data analysis. ⊚ true ⊚ false

379)

A digital dashboard allows for communicating a selection of KPIs. ⊚ true ⊚ false

380)

The balanced scorecard is based around a company's profit and loss statement. ⊚ true ⊚ false

381)

The value of a digital dashboard is maximized when the metrics provided are used to impact decision-making and action. ⊚ true ⊚ false

382)

The balanced scorecard helps companies turn their strategic goals into action by identifying the most important metrics to measure. ⊚ true ⊚ false

383)

The balanced scorecard is comprised of four components: financial, customer, internal process and organizational validity. ⊚ true ⊚ false

384)

Financial performance KPIs include net profit, net profit margin, and gross profit margin. ⊚ true ⊚ false

385)

Customer KPIs include price earnings ratio, net promoter score, and customer retention score. ⊚ true ⊚ false

386)

Operational KPIs include six sigma level and first contact resolution. ⊚ true ⊚ false

387)

Employee Performance KPIs include staff advocacy score and overall equipment effectiveness. ⊚ true ⊚ false

388)

Environmental and social sustainability KPIs include energy consumption and carbon footprint. ⊚ true ⊚ false

389)

A balanced scorecard includes a well-defined mission, vision and set of values which are integral in creating and maintaining a successful culture. ⊚ true ⊚ false

390)

A proper strategy for a company’s growth considers what a firm does well and how it achieves it. ⊚ true ⊚ false

391)

KPI data is typically stored in the company’s ERP or accounting information system while KPI data analysis for the digital dashboard is created in a data visualization tool such as Excel or Tableau. ⊚ true ⊚ false

392)

Since KPI dashboards are usually monitored on a daily basis, the importance of communication between all users is trivial. ⊚ true ⊚ false

393)

The IMPACT model should be used to complete a project using a balanced scorecard or some other type of digital dashboard to highlight metrics and KPIs. ⊚ true ⊚ false

394)

The calculation measuring how an organization is performing, particularly when that measure is compared to a baseline, is called a: A) balanced scorecard.

B) digital dashboard.

C) key performance indicator.

D) performance metric.

395)

A particular type of metric that an organization deems the most important and influential on decision-making is known as a: A) balanced scorecard.

B) digital dashboard.

C) key performance indicator.

D) performance metric.

396)

A type of report that is made up of strategic objectives and metrics to help the organization reach its target measures in line with strategic goals is called a: A) balanced scorecard.

B) digital dashboard.

C) key performance indicator.

D) performance metric.

397)

An interactive report showing the most important metrics to help users understand how a company or an organization is performing is called a: A) balanced scorecard.

B) digital dashboard.

C) key performance indicator.

D) performance metric.

398)

The balanced scorecard is comprised of four components; which of the following is not an item that should be identified for each component?

A) objectives B) measures C) destinations D) initiatives

399)

The balanced scorecard is comprised of four components, which of the following is not a component of a balanced scorecard?

A) Financial B) Customer C) Internal process D) External process

400)

Market share is which of the following types of KPI? A) Marketing B) Customer C) Operational D) Financial performance

401)

Market growth rate is which of the following types of KPI? A) Marketing B) Customer C) Operational D) Financial performance

402)

Social networking footprint is which of the following types of KPI? A) Marketing B) Operational C) Customer D) Financial performance

403)

Training return on investment is which of the following types of KPI? A) Employee performance B) Operational C) Customer D) Financial performance

404)

Staff advocacy score is which of the following types of KPI? A) Employee performance B) Operational C) Customer D) Financial performance

405)

Revenue per employee is which of the following types of KPI? A) Employee performance B) Operational C) Customer D) Financial performance

406)

EBITDA is which of the following types of KPI? A) Employee performance B) Operational C) Marketing D) Financial performance

407)

Operating profit margin is which of the following types of KPI? A) Employee performance B) Operational C) Marketing D) Financial performance

408)

Return on investment is which of the following types of KPI? A) Employee performance B) Operational C) Marketing D) Financial performance

409)

Operating expense ratio is which of the following types of KPI? A) Employee performance B) Operational C) Marketing D) Financial performance

410)

Customer turnover rate is which of the following types of KPI? A) Employee performance B) Operational C) Customer D) Financial performance

411)

Customer retention rate is which of the following types of KPI? A) Employee performance B) Operational C) Customer D) Financial performance

412)

Inventory shrinkage rate is which of the following types of KPI? A) Employee performance B) Operational C) Customer D) Financial performance

413)

Return on innovation investment is which of the following types of KPI? A) Employee performance B) Operational C) Customer D) Financial performance

414)

First pass yield is which of the following types of KPI? A) Employee performance B) Operational C) Customer D) Financial performance

415)

Process downtime level is which of the following types of KPI? A) Employee performance B) Operational C) Customer D) Financial performance

416)

Waste reduction rate is which of the following types of KPI? A) Employee performance B) Operational C) Environmental and social sustainability D) Financial performance

417)

Energy consumption is which of the following types of KPI? A) Employee performance B) Operational C) Environmental and social sustainability D) Financial performance

418)

Which of the following is an example of an environmental and social performance sustainability KPI? A) 360-degree feedback score B) Process waste level C) Conversion rate D) Supply chain miles

419)

Which of the following is an example of an Employee Performance KPI? A) Six Sigma Level B) Salary competitiveness ratio C) First contact resolution D) Working capital ratio

420)

Which of the following is an example of an operational KPI? A) CAPEX to sales ratio B) Absenteeism Bradford factor C) Overall equipment effectiveness D) Product recycling rate

421)

Which of the following is an example of a marketing KPI? A) Customer lifetime value B) Quality index C) Page views and bounce rate D) Time to market

422)

Which of the following is an example of a customer KPI? A) Customer online engagement level B) Capacity utilization rate C) Cost per lead D) Net promoter score

423)

Which of the following is an example of a financial performance KPI? A) Economic value added B) Brand equity C) Klout score D) Earned value (EV) metric

424)

In a balanced scorecard, what are the actions that an organization can take to move its specified metrics in the direction of their stated target goal?

A) Objectives B) Initiatives C) Measures D) Targets

425)

In a balanced scorecard, what should be aligned with strategic goals of the organization?

A) Objectives B) Initiatives C) Measures D) Targets

426)

In a balanced scorecard, what should be achievable goals toward which to move the metric?

A) Objectives B) Initiatives C) Measures D) Targets

427)

What type of analysis is used to determine the fixed and variable components of mixed costs?

A) Correlation analysis B) Benfords’ Law C) Crosstabulation analysis D) Regression analysis

428)

What type of analytics would be used to predict future sales for decision-making purposes?

A) Descriptive B) Diagnostic C) Predictive D) Prescriptive

429)

What type of analytics would be used to assess the difference between budgeted and actual performance?

A) Descriptive B) Diagnostic C) Predictive D) Prescriptive

430)

An analysis of favorable and unfavorable price variances would be an example of__________ analytics.

A) descriptive B) diagnostic C) predictive D) prescriptive

431)

Digital dashboards would be an example of which component of the IMPACT model?

A) Identify the Question B) Address and Refine Results C) Perform Test Plan D) Track Outcomes

432)

Determining the cost of a specific job would be an example of: A) descriptive analytics.

B) diagnostic analytics.

C) predictive analytics.

D) prescriptive analytics.

433)

Sensitivity analysis an example of: A) descriptive analytics.

B) diagnostic analytics.

C) predictive analytics.

D) prescriptive analytics.

434)

Analyzing whether a company should manufacture its products or outsource them to a third party is an example of: A) descriptive analytics.

B) diagnostic analytics.

C) predictive analytics.

D) prescriptive analytics.

435)

Creating a digital dashboard to present KPIs for decision-making is consistent with which component of the IMPACT model?

A) Communicate insights B) Address and refine results C) Perform the test plan D) Track outcomes

436)

An understanding of how frequently the data underlying a balanced scorecard are updated is an important component of which of the following components of the IMPACT model?

A) Identify the question B) Master the data C) Perform the test plan D) Address and refine results

437)

Dashboards tend to be monitored on a: A) monthly basis.

B) daily basis.

C) quarterly basis.

D) annual basis.

438)

Dashboards are part of which component of the IMPACT model?

A) Address and Refine Results B) Identify the Question C) Track Outcomes D) Communicate Insights

439)

An understanding of how often the data get updated is an important component of which of the 4 V’s?

A) Volume B) Variety C) Velocity D) Veracity

440)

Which of the following is not a software tool used to create dashboards?

A) Tableau Prep B) Alteryx C) Excel D) Power BI

Answer Key Test name: chapter 7 1) TRUE 2) FALSE 3) TRUE 4) TRUE 5) TRUE 6) FALSE 7) TRUE 8) TRUE 9) FALSE 10) TRUE 11) FALSE 12) TRUE 13) FALSE 14) TRUE 15) TRUE 16) TRUE 17) TRUE 18) FALSE 19) TRUE 20) D 21) C 22) A 23) B 24) C 25) D 26) A 27) A 28) A 29) A 30) A 31) A 32) D 33) D 34) D 35) D 36) C 37) C

38) B 39) B 40) B 41) B 42) C 43) C 44) D 45) B 46) C 47) C 48) D 49) A 50) B 51) A 52) D 53) D 54) C 55) B 56) B 57) D 58) A 59) D 60) D 61) D 62) B 63) B 64) C 65) C 66) A

Student name:__________ 441)

Artificial intelligence, machine learning, and sentiment analysis are three methods used to analyze publicly traded companies on Nasdaq and the NYSE to gain insight and track companies’ business and financial operations. ⊚ true ⊚ false

442)

Data analytics can help predict a company’s revenue, earnings, and cash flow. ⊚ true ⊚ false

443)

XBRL is a global standard for internet communication mostly among day traders. ⊚ true ⊚ false

444)

The Securities and Exchange Commission mandates all publicly traded companies file financial statements prepared in accordance with U.S. GAAP. ⊚ true ⊚ false

445)

XBRL stands for eXtensible Business Reporting Linguistic. ⊚ true ⊚ false

446)

The two major types of standardized financial accounting are IFRS and U.S. GAAP. ⊚ true ⊚ false

447)

In filing its financial statements with the SEC, a company must tag five basic financial statements, which include a balance sheet, income statement, statement of comprehensive income, statement of cash flows and statement of stockholder’s equity. ⊚ true ⊚ false

448)

When reporting financial statements, detailed tagging of the numbers included in the footnotes by use of XBRL tags is also required. ⊚ true ⊚ false

449)

The XBRL taxonomy helps define and describe each key data element (such as cash or employee spending). ⊚ true ⊚ false

450)

The US GAAP Financial Reporting Taxonomy offers over 19,000 unique tags for financial data as part of the taxonomy. ⊚ true ⊚ false

451)

The XBRL tag for cash is labeled Cash and is defined as follows: Amount of currency on hand as well as demand deposits with banks or financial institutions. ⊚ true ⊚ false

452)

The use of XBRL tags allows data to be slowly transmitted and received and serve as an input into financial analysts valuing a company, or an auditor finding areas where an error might occur, or regulators seeing if firms are in compliance with various regulations and laws (like SEC or IRS). ⊚ true ⊚ false

453)

Sometimes outside data vendors create standardized metrics to make the company reported XBRL data more comparable. ⊚ true ⊚ false

454)

Many financial reporting systems within enterprise systems have general ledgers that are consistent with XBRL called XBRL-GL. ⊚ true ⊚ false

455)

Once numbers are input into a financial system using XBRL-GL, they are already tagged and able to be transmitted on the next day of business to interested users. ⊚ true ⊚ false

456)

Information such as goodwill or long-term debt will likely change on a minute-by-minute basis in real-time financial reporting. ⊚ true ⊚ false

457)

Financial statement analysis is used by investors, analysts, auditors and other interested stakeholders to review and evaluate a company’s financial statements and financial performance. ⊚ true ⊚ false

458)

A major component of financial statement analysis is the use of ratio analysis. ⊚ true ⊚ false

459)

Ratio analysis is a tool used to evaluate relationships among different financial statement items to help understand a company’s financial and operating performance. ⊚ true ⊚ false

460)

There are basically four types of ratios: Liquidity, activity, solvency (or financing) and profitability ratios. ⊚ true ⊚ false

461)

XBRL stands for: A) eXtended Business Reporting Language and is a type of HTML. B) eXtended Business Reporting Language and is a type of XML. C) eXtensible Business Reporting Language and is a type of XML. D) eXtensible Business Reporting Language and is a type of HTML.

462)

XBRL is used for reporting financial elements and: A) Tagging B) Composing C) Representing D) Summarizing

463)

The Securities and Exchange Commission requires all public company filers to use XBRL tagging in all of the following financial statements except: A) Balance Sheet B) Statement of Comprehensive Income C) Statement of Cash Flows D) Statement of Changes in Working Capital

464)

What does XBRL use to help describe each key data element?

A) Taxonomy B) Data dictionary C) Schema D) Terminology

465)

Which of the following is not a type of tagging with XBRL? A) Years B) Figures C) Hieroglyphs D) Text

466)

According to the authors, the use of XBRL tags allows data to be quickly: A) cleaned and prepared.

B) transformed and received.

C) sorted and reconfigured.

D) transmitted and received.

467)

The authors discuss all of the following ways in which tags can serve as an input except: A) regulators seeing if audit firms are in compliance with various regulations and laws.

B) regulators seeing if companies are in compliance with various regulations and laws.

C) financial analysts valuing a company.

D) an auditor finding areas where an error might occur.

468)

Which of the following statements is false?

A) Firms can make their own tags if they feel their financial data item does not fit within the existing framework.

B) Sometimes very similar financial data items have unique tags, making direct comparisons between companies difficult.

C) Detailed tagging of the numbers included in the footnotes is required.

D) XBRL uses a taxonomy to help define and describe each key data element, but it is not capable of defining relationships between each element.

469)

Using the table below compute profit margin for Q3, 2021 for Coverage Incorporated (Ticker = CD).

Ticke Yea Perio Revenue r r d CD 202 Y $ 0 28,899,000, 000 CD 202 Q1 10,059,000, 1 000 CD 202 Q2 10,493,000, 1 000 CD 202 Q3 8,303,000,0 1 00 CD 202 Y 34,423,000, 1 000 CD 202 Q1 10,194,000, 2 000 A) 22.0% B) 31.5% C) 30.9% D) 23.6%

Cost of revenue

Assets

Equity

$ 20,574,000, 000 6,831,000,0 00 7,191,000,0 00 6,345,000,0 00 21,264,000, 000 6,816,000,0 00

$ 40,410,000, 000 42,600,000, 000 47,736,000, 000 47,794,000, 000 48,643,000, 000 50,223,000, 000

$ 9,800,000,0 00 11,279,000, 000 12,502,000, 000 12,024,000, 000 9,208,000,0 00 10,427,000, 000

470)

Using the table below compute operating leverage for Q3, 2021 for Coverage Incorporated (Ticker = CD).

Ticke Yea Perio Revenue r r d CD 202 Y $ 0 28,899,000, 000 CD 202 Q1 10,059,000, 1 000 CD 202 Q2 10,493,000, 1 000 CD 202 Q3 8,303,000,0 1 00 CD 202 Y 34,423,000, 1 000 CD 202 Q1 10,194,000, 2 000 A) 13.3% B) 17.4% C) 25.2% D) 52.8%

Cost of revenue

Assets

Equity

$ 20,574,000, 000 6,831,000,0 00 7,191,000,0 00 6,345,000,0 00 21,264,000, 000 6,816,000,0 00

$ 40,410,000, 000 42,600,000, 000 47,736,000, 000 47,794,000, 000 48,643,000, 000 50,223,000, 000

$ 9,800,000,0 00 11,279,000, 000 12,502,000, 000 12,024,000, 000 9,208,000,0 00 10,427,000, 000

471)

Using the table below compute ROE for Q3, 2021 for Coverage Incorporated (Ticker =CD).

Ticke Yea Perio Revenue r r d CD 202 Y $ 0 28,899,000, 000 CD 202 Q1 10,059,000, 1 000 CD 202 Q2 10,493,000, 1 000 CD 202 Q3 8,303,000,0 1 00 CD 202 Y 34,423,000, 1 000 CD 202 Q1 10,194,000, 2 000 A) 12.4% B) 16.3% C) 21.3% D) 26.6%

Cost of revenue

Assets

Equity

$ 20,574,000, 000 6,831,000,0 00 7,191,000,0 00 6,345,000,0 00 21,264,000, 000 6,816,000,0 00

$ 40,410,000, 000 42,600,000, 000 47,736,000, 000 47,794,000, 000 48,643,000, 000 50,223,000, 000

$ 9,800,000,0 00 11,279,000, 000 12,502,000, 000 12,024,000, 000 9,208,000,0 00 10,427,000, 000

472)

Using the table below compute ROE for 2021 year-end for Coverage Incorporated (Ticker = CD).

Ticke Yea Perio Revenue r r d CD 202 Y $ 0 28,899,000, 000 CD 202 Q1 10,059,000, 1 000 CD 202 Q2 10,493,000, 1 000 CD 202 Q3 8,303,000,0 1 00 CD 202 Y 34,423,000, 1 000 CD 202 Q1 10,194,000, 2 000 A) 149.2% B) 70.8% C) 84.9% D) 142.9%

Cost of revenue

Assets

Equity

$ 20,574,000, 000 6,831,000,0 00 7,191,000,0 00 6,345,000,0 00 21,264,000, 000 6,816,000,0 00

$ 40,410,000, 000 42,600,000, 000 47,736,000, 000 47,794,000, 000 48,643,000, 000 50,223,000, 000

$ 9,800,000,0 00 11,279,000, 000 12,502,000, 000 12,024,000, 000 9,208,000,0 00 10,427,000, 000

473)

According to the text, research finds that as the use of negative words in a company’s 10K increases, the stock price is likely to: A) increase.

B) decrease.

C) not be affected.

D) not be determinable.

474)

Sparklines display simple trends and: A) are shown in green or red.

B) show relative importance.

C) are small in size.

D) are large in size.

475)

With regard to sparklines, which of the following statements is false?

A) Sparklines can allow financial statement users to easily see the data visually and give meaning to the underlying financial data.

B) Sparklines can be added to a digital dashboard that already has many charts and dials, without cluttering up the overall appearance of a dashboard.

C) Sparklines can, generally, fit in a single cell within a spreadsheet.

D) Sparklines can easily add to the data without detracting from the tabular results.

476)

A visualization that shows inherent hierarchy is called a: A) heat map.

B) sunburst diagram.

C) tree diagram.

D) pie chart.

477)

A visualization that shows the relative size of values by applying a color scale is called a: A) heat map.

B) sunburst diagram.

C) sparkline.

D) pie chart.

478)

A visualization that is used to show trends that replaces or complements lots of numbers is called a: A) heat map.

B) sunburst diagram.

C) sparkline.

D) pie chart.

479)

Liquidity ratios measure a firm’s: A) ability to pay short-term obligations using current assets.

B) operating efficiency.

C) ability to pay their debts and stay in business.

D) ability to generate earnings relative expenses.

480)

Activity ratios measure a firm’s: A) ability to pay short-term obligations using current assets.

B) operating efficiency.

C) ability to pay their debts and stay in business.

D) ability to generate earnings relative to its expenses.

481)

Profitability ratios measure a firm’s: A) ability to pay short-term obligations using current assets.

B) operating efficiency.

C) ability to pay their debts and stay in business.

D) ability to generate earnings relative to its expenses.

482)

Solvency ratios measure a firm’s: A) ability to pay short-term obligations using current assets.

B) operating efficiency.

C) ability to pay their debts and stay in business.

D) ability to generate earnings relative to its expenses.

483)

Profit margin is an example of which type of ratio?

A) Solvency ratio B) Profitability ratio C) Liquidity ratio D) Activity ratio

484)

Return on assets is an example of which type of ratio?

A) Solvency ratio B) Profitability ratio C) Liquidity ratio D) Activity ratio

485)

Return on equity is an example of which type of ratio?

A) Solvency ratio B) Profitability ratio C) Liquidity ratio D) Activity ratio

486)

Long-term debt to equity ratios are examples of which type of ratio?

A) Solvency ratio B) Profitability ratio C) Liquidity ratio D) Activity ratio

487)

Debt-to-equity ratio is an example of which type of ratio?

A) Solvency ratio B) Profitability ratio C) Liquidity ratio D) Activity ratio

488)

Inventory turnover ratio is an example of which type of ratio?

A) Solvency ratio B) Profitability ratio C) Liquidity ratio D) Activity ratio

489)

Accounts receivable turnover ratio is an example of which type of ratio?

A) Solvency ratio B) Profitability ratio C) Liquidity ratio D) Activity ratio

490)

Total assets turnover ratio is an example of which type of ratio?

A) Solvency ratio B) Profitability ratio C) Liquidity ratio D) Activity ratio

491)

The current ratio divides total current assets by total current liabilities and is an example of which type of ratio?

A) Solvency ratio B) Profitability ratio C) Liquidity ratio D) Activity ratio

492)

The quick ratio is an example of which type of ratio?

A) Solvency ratio B) Profitability ratio C) Liquidity ratio D) Activity ratio

493)

The acid-test ratio is an example of which type of ratio?

A) Solvency ratio B) Profitability ratio C) Liquidity ratio D) Activity ratio

494)

Sparklines are defined as: A) a small trendline or graphic that efficiently summarizes numbers of statistics in a graph without axes.

B) a small trendline or graphic that efficiently summarizes numbers of statistics in a graph with axes.

C) a large trendline or graphic that efficiently summarizes numbers of statistics in a graph without axes.

D) a large trendline or graphic that efficiently summarizes numbers of statistics in a graph with axes.

495)

Sparklines are generally shown in: A) several spreadsheet cells.

B) a graphic on a separate worksheet.

C) a single spreadsheet cell.

D) a graphic on the same worksheet, but separable from the numbers underlying it.

496)

The method of assessing text sentiment in a block of text that involves counting the number of words of a certain type from a financial dictionary is called: A) the dictionary method.

B) the overlap method.

C) the word count method.

D) the sentiment method.

497)

Which of the following is not considered to be a negative word in the financial dictionary?

A) Litigation B) Adverse C) Impairment D) Liability

498)

Which of the following is considered to be a negative word in the standard English dictionary, but not a negative word in the financial dictionary?

A) Restructuring B) Claims C) Loss D) Expense

499)

The DuPont method evaluates all of the following ratios as part of its analysis except: A) Liquidity B) Profitability C) Efficiency D) Leverage

500)

According to the text, the XBRL Taxonomy tags unique financial data for about: A) 1,900 elements.

B) 19,000 elements.

C) 190,000 elements.

D) 190 elements.

501)

As opposed to horizontal analysis, vertical analysis: A) shows the proportional value of accounts to a primary account, like sales revenue on an income statement.

B) shows the change in value of an account from one period to the next.

C) disaggregates return on equity into its component parts.

D) shows the proportionate value of common accounts across companies.

502)

As opposed to vertical analysis, horizontal analysis: A) shows the proportional value of accounts to a primary account, like sales revenue on an income statement.

B) shows the change in value of an account from one period to the next.

C) disaggregates return on equity into its component parts.

D) shows the proportionate value of common accounts across companies.

503)

Standardized metrics are useful to help XBRL data more comparable because: A) companies use similar XBRL tags for similar accounts.

B) companies use different XBRL tags for similar accounts.

C) companies insist on using XBRL tags that facilitate comparison to their competitors.

D) companies insist on using XBRL tags that do not allow comparison to their competitors.

504)

XBRL-GL is for firms wishing to put tags on accounts within their: A) internal financial reporting system.

B) external financial reporting system.

C) financial statements.

D) footnotes.

505)

Standardized metrics are tags used by the: A) reporting company to allow easier comparison of company reported XBRL data.

B) reporting company to allow easier comparison of company reported non-XBRL data.

C) data vendors to allow easier comparison of company reported XBRL data.

D) data vendors to allow easier comparison of company reported non-XBRL data.

Answer Key Test name: chapter 8 1) TRUE 2) TRUE 3) FALSE 4) TRUE 5) FALSE 6) TRUE 7) TRUE 8) TRUE 9) FALSE 10) TRUE 11) TRUE 12) FALSE 13) TRUE 14) TRUE 15) FALSE 16) FALSE 17) TRUE 18) TRUE 19) TRUE 20) TRUE 21) C 22) A 23) D 24) A 25) C 26) D 27) A 28) D 29) D 30) B 31) B 32) D 33) B 34) C 35) B 36) B 37) A

38) C 39) A 40) B 41) D 42) C 43) B 44) B 45) B 46) A 47) A 48) D 49) D 50) D 51) C 52) C 53) C 54) A 55) C 56) B 57) D 58) D 59) A 60) B 61) A 62) B 63) A 64) A 65) C

Student name:__________ 506)

The tax function has its own reporting system, separate from the financial reporting system. ⊚ true ⊚ false

507)

Frequency and magnitude of tax audit adjustments are an example of tax risk KPIs. ⊚ true ⊚ false

508)

The effective tax rate over time is an example of tax cost KPIs. ⊚ true ⊚ false

509)

The overall goal of a company’s tax function is to maximize taxable income. ⊚ true ⊚ false

510)

One way for tax regulators to assess if companies are paying sufficient tax is to look at the differences between the amount of income reported for financial reporting purposes and the amount of taxable income reported to the IRS. ⊚ true ⊚ false

511)

According to the text, the IRS mines and monitors personal data from social media (such as Facebook, Twitter, Instagram, etc.)1 about taxpayers. ⊚ true ⊚ false

512)

According to the text, analytics can be used to find supporting evidence for an R&D tax credit. ⊚ true ⊚ false

513)

According to the text, the IRS uses an algorithm called Tax Profiling Algorithm that pulls historical data for average amount and type of deductions related to income level and predicts the likelihood of underreported income. ⊚ true ⊚ false

514)

Dashboards allow tax departments to evaluate those jurisdictions where current state income tax liabilities have departed most from the liability of prior years. ⊚ true ⊚ false

515)

What-if scenario analysis tests the impact of various output data on an expected input. ⊚ true ⊚ false

516)

The effect of tax loss carry-forwards are examples of tax efficiency and effectiveness KPIs. ⊚ true ⊚ false

517)

Companies might engage in data analytics to help avoid a tax audit. ⊚ true ⊚ false

518)

Companies might engage in data analytics “to see what the regulator is seeing”. ⊚ true ⊚ false

519)

An analysis of why a company pays a higher effective tax rate than its industry would be an example of diagnostic analytics. ⊚ true ⊚ false

520)

One of the potential analyses performed using data analytics would be calculating and documenting book-tax differences. ⊚ true ⊚ false

521)

Tax software and analytics (such as Hyperion or Corptax) is used to help with the reconciliation to find both permanent and temporary differences between the two methods of computing income and also to provide needed support for IRS schedule M-3. ⊚ true ⊚ false

522)

Tax departments are able to specify what data might affect their tax calculations for their tax data mart but not involve a continuous feed of that data. ⊚ true ⊚ false

523)

The usefulness of the what-if scenario analysis is that decision makers can see the possible impact of changes in tax rates across multiple scenarios. ⊚ true ⊚ false

524)

A data warehouse is data kept for more general purposes, but a __________ is kept for more specific purposes.

A) data mart B) data store C) database D) data dump

525)

What is defined as the analysis of potential tax liability and formulation of a plan to reduce the amount of taxes paid?

A) What-if scenario tax analysis B) Tax planning C) Tax compliance D) Tax contingency planning

526)

The IRS uses an algorithm called the __________ that pulls historical data for average amount and type of deductions related to income level and predicts the likelihood of underreported income.

A) Discriminant Function Algorithm B) Profiling Algorithm C) Underreporting Algorithm D) Tax Evaders Algorithm

527)

The task of tax accountants and tax departments to minimize the amount of taxes paid in the future is called: A) tax planning.

B) tax compliance.

C) tax minimization.

D) tax reduction.

528)

Levels of technology/tax training would be an example of which kind of KPI? A) Tax cost B) Tax risk C) Tax efficiency and effectiveness D) Tax sustainability

529)

Effect of loss carry-forwards would be an example of which kind of KPI? A) Tax cost B) Tax risk C) Tax efficiency and effectiveness D) Tax sustainability

530)

Level of job satisfaction of the tax personnel would be an example of which kind of KPI? A) Tax cost B) Tax risk C) Tax efficiency and effectiveness D) Tax sustainability

531)

What is used to extract past and real-time data from the financial reporting system that is most applicable to the tax function?

A) Tax data warehouse B) Tax data mart C) Tax data store D) Tax database

532)

The 2018 Tax Cuts and Jobs Act Tax Reform provided tax benefits for real estate investments in: A) opportunity zones.

B) tax-free zones.

C) tax-incentive zones.

D) real estate tax zones.

533)

All of the following are included in a company's data warehouse except: A) Enterprise data B) Reporting data C) Tax tables D) Tax KPIs

534)

The IRS has direct access to all but the following data that is used to evaluate the possibility of tax evasion: A) schedule K-1’s.

B) credit risk scores.

C) form 1099.

D) form 18-C.

535)

Data analytics is used to qualify for R&D tax credits by: A) using data analytics to provide supporting documentation of R&D expenditures made.

B) including the cost to perform data analytics as qualifying R&D expenditures.

C) using data analytics to find additional qualifying R&D expenditures.

D) evaluating whether existing R&D expenditures qualify for tax credit.

536)

According to the text, which of the following questions would not be involved with tax planning?

A) What will be the impact of a new tax rate on our tax liability?

B) Are we minimizing our tax burden by tracking all eligible deductible expenses and transactions that qualify for tax credits?

C) What would be the impact of relocating our headquarters to a different city, state or country?

D) How to minimize taxes on the tax return on the fiscal year just ended?

537)

Which type of tax analytics provide insight by creating a trend analysis for sales and use tax paid in different locations, which would help identify seasonal patterns or abnormal transaction volume that warrant further investigation?

A) Descriptive analytics B) Diagnostic analytics C) Predictive analytics D) Prescriptive analytics

538)

A reconciliation that finds the difference between taxable income and financial income would be an example of: A) descriptive analytics.

B) diagnostic analytics.

C) predictive analytics.

D) prescriptive analytics.

539)

Which type of tax analytics uses historical data to identify future tax liabilities?

A) Descriptive analytics B) Diagnostic analytics C) Predictive analytics D) Prescriptive analytics

540)

Tax planning to minimize the payment of taxes paid by a company is an example of which type of tax analytics?

A) Descriptive analytics B) Diagnostic analytics C) Predictive analytics D) Prescriptive analytics

541)

Which type of tax analytics provide insight into the current processes, policies, and calculations related to determining tax liability?

A) Descriptive analytics B) Diagnostic analytics C) Predictive analytics D) Prescriptive analytics

542)

Which type of tax analytics summarizing transactions by jurisdiction or category to more accurately calculate tax liability?

A) Descriptive analytics B) Diagnostic analytics C) Predictive analytics D) Prescriptive analytics

543)

Which type of tax analytics provide insight which might help identify items of interest, such as high tax areas or excluded transactions?

A) Descriptive analytics B) Diagnostic analytics C) Predictive analytics D) Prescriptive analytics

544)

Which type of tax analytics uses ancillary data, including growth rates, trends, and other identified patterns, aids in the usefulness of regression and what-if analyses?

A) Descriptive analytics B) Diagnostic analytics C) Predictive analytics D) Prescriptive analytics

545)

Which type of tax analysis tests the impact of various input data on an expected output?

A) What-if Scenario Analysis B) Goal Seek Analysis C) Cash Flow Analysis D) What-if Case Analysis

546)

To plan for the impact on taxes of the recent change in accounting for research and experimental expenditures, analysts may use which of the following types of prescriptive analytics?

A) What-if Scenario Analysis B) Goal Seek Analysis C) Regression Analysis D) What-if Case Analysis

547)

Determining the appropriate structure of a merger and/or acquisition transaction that would give the greatest tax advantage would be an example of: A) descriptive analytics.

B) diagnostic analytics.

C) predictive analytics.

D) prescriptive analytics.

548)

549)

The effective tax rate over time would be an example of which kind of KPI? A) Tax cost B) Tax risk C) Tax efficiency and effectiveness D) Tax sustainability

The amount of time spent on compliance versus strategic activities would be an example of which kind of KPI? A) Tax cost B) Tax risk C) Tax efficiency and effectiveness D) Tax sustainability

550)

Number of tax audits closed and significance of assessment would be an example of which kind of KPI? A) Tax cost B) Tax risk C) Tax efficiency and effectiveness D) Tax sustainability

551)

Tax-focused KPIs appear on dashboards or cockpits, consistent with which components of the IMPACT model?

A) Identify the Question B) Master the Data C) Perform the Text D) Communicate Insights

552)

Tax sustainability KPIs appear on dashboards or cockpits, consistent with which components of the IMPACT model?

A) Tracking Outcomes B) Identify the Question C) Master the Data D) Communicate Insights

553)

Querying the tax data mart would be consistent with which components of the IMPACT model?

A) Tracking Outcomes B) Perform the Analysis C) Identify the Question D) Communicate Insights

554)

Performing regressions using data from the tax data mart would be consistent with which components of the IMPACT model?

A) Tracking Outcomes B) Perform the Analysis C) Master the Data D) Communicate Insights

555)

The change in US tax code, requiring companies to capitalize R&E expenditures, is expected to have what effect on taxable income and corresponding tax liability?

A) Have uncertain impact on taxable income and corresponding tax liability B) Increase taxable income and corresponding tax liability C) Decrease taxable income and corresponding tax liability D) Have no impact on taxable income and corresponding tax liability

556)

According to the text, all but which of the following data marts come from a companywide data warehouse?

A) Financial data mart B) Tax data mart C) Marketing data mart D) Compensation data mart

557)

The frequency of concerns pertaining to the organization’s tax position is an example of which kind of KPI? A) Tax cost B) Tax risk C) Tax efficiency and effectiveness D) Tax sustainability

558)

Potential items that comprise permanent differences between book and tax income include all but the following: A) Penalties and fines (excluded from taxable income).

B) Meals and entertainment (100 percent books, 50 percent tax).

C) Dividends received deduction (taxed based on percentage of ownership).

D) R&D expense

Answer Key Test name: chapter 9 1) FALSE 2) TRUE 3) FALSE 4) FALSE 5) TRUE 6) TRUE 7) TRUE 8) FALSE 9) TRUE 10) FALSE 11) FALSE 12) TRUE 13) TRUE 14) TRUE 15) TRUE 16) TRUE 17) FALSE 18) TRUE 19) A 20) B 21) A 22) A 23) C 24) A 25) C 26) B 27) A 28) D 29) D 30) A 31) D 32) B 33) B 34) C 35) D 36) A 37) A

38) B 39) C 40) A 41) A 42) D 43) D 44) C 45) D 46) D 47) A 48) A 49) B 50) B 51) D 52) B 53) D