EMT Practice Test

1. Question Content...

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Question1: V buys vegetables and fruit from three farms located in a different part of V's country and sells them to large supermarket chains.
A recent newspaper magazine had an article on these farms showing that the farms employ illegal immigrants whose status was used by the factory's owners to force them to work for low wages and in unpleasant conditions. They are forced to live in small overcrowded caravans with no running water. They are also given meals which are cold and poor quality. These farms are located in a developed country with strong labour laws.
Classify each of the following statements as true or false.

Question2: Select the correct ethical principle that corresponds to each ethical dilemma described.

Question3: A UK based company is considering an investment of GB£1,000,000 in a project in the USA. It is anticipated that the following cash flows will arise from this project.
The cash flows will be either US$400,000 with a probability of 40% or US$700,000 with a probability of 60% for each of the next three years; remitted to the UK at the end of each year.
Currently GB£1.00 is worth US$1.30.
The expected inflation rates in the two countries over the next four years are 2% in the UK and 4% in the US.
Applying the Purchasing Power Parity Theory, which of the following represents the expected net present value of the project in GP£ (to the nearest whole pound)?

Question4: Company W produces mobile phone components and has recently tendered for a substantial contract. The results of the tendering process will not become available until three months from now. If the company is successful it will require 2,000 units of a commodity which is currently traded in an open commodity market for $740 per unit. However, there has been speculation that this commodity could increase substantially in price over the next three months and so the company is considering purchasing the commodity now and storing it for three months.
The funds to buy the commodity would be borrowed at an annual interest rate of 7% and the storage cost of the product would be $5.40 per unit per month. The storage costs would be paid at the end of the three month storage period.
Which of the following represents the gain or loss (to the nearest thousand dollars) that will accrue to Company W assuming that the price of the commodity rises to $800 in three months' time?

Question5: GUJ A small but rapidly expanding company has recently opened several branches in locations far away from the Head Office. All of the branches are relatively small with no one branch accounting for more than 5% of turnover. Management has decided that the company is not yet large enough to install an Internal Audit function but is, nonetheless, concerned about maintaining adequate control and monitoring at the branches whilst allowing Branch Managers the opportunity to react to local circumstances as appropriate.
Which of the following measures would assist Head Office management in maintaining appropriate monitoring and control at the branches?

Question6: The senior manager in the accounts department is going on annual leave for three weeks and Jo, a supervisor is being put in charge of the department for that time Which TWO of the following statements are correct?

Question7: V buys vegetables and fruit from three farms located in a different part of V's country and sells them to large supermarket chains.
A recent newspaper magazine had an article on these farms showing that the farms employ illegal immigrants whose status was used by the factory's owners to force them to work for low wages and in unpleasant conditions. They are forced to live in small overcrowded caravans with no running water. They are also given meals which are cold and poor quality. These farms are located in a developed country with strong labour laws.
Classify each of the following statements as true or false.

Question8: Which categories on a risk map best describe the loss of sales floor staff in a fast fashion chain?

Question9: You are the management accountant for YY a food manufacturing company with an annual sales revenue of
$6 million
You discover that the production manager's records are inconsistent Raw materials purchased do not agree with the total recorded for transfers to production plus wastage There is an average shortfall of 2% of purchases You have investigated and discovered that there are often errors made during manufacturing that results in food that is safe to eat but. because of visual flaws, cannot be sold The production manager is supposed to scrap all such damaged products and write all such losses off as waste You have discovered however that he has been giving the damaged food to a charity that assists homeless people No records are made of such gifts in order to conceal the losses due to manufacturing errors Which of the following actions should you take? Select ALL that apply

Question10: K plc is a large listed company in the retail industry. It has recently appointed T as a non-executive director. T has never had any previous involvement with K plc but is well known to K's Chief Executive P because T is the Managing Director of K plc's largest supplier.
K has recently expanded into Asia. Doubts about the wisdom of the move have been expressed in the financial press with some journalists commenting that it has exposed K plc to higher degrees of risk than previously.
The move had been approved by the Risk Committee which consists of four Non-Executive Directors (NEDs) all of whom have significant experience in business.
K plc does not have a Nominations Committee. Nominations to the Board are usually proposed by P and generally agreed by the other directors.
In relation to the above scenario which of the following comments is valid?

Question11: YHJ is considering an investment in a project that will cost $20 million. Annual fixed costs will be $12 million per year, excluding depreciation. Annual sales are forecast at 5 million units, with a contribution per unit of
$8. After five years the equipment will be worn out and YHJ will have to spend $50 million on disposal costs.
The discount rate is 10%.
Calculate the sensitivity of the net present value of this project to a 20% increase in the disposal costs.

Question12: You are in process of compiling a risk register for P, a company which maintains railway tracks. This helps prevent accidents and ensures the trains are not disrupted due to problems with the track.
Which of the following statements are valid?

Question13: An oil company has entered into a joint venture with a competing oil company to develop a new oil field. The joint venture arrangement is intended to mitigate the risks associated with developing the oil field.
The following disclosure appears in the oil company's risk report:
"Many of our large projects and operations are conducted through joint ventures. These arrangements involve complex risk allocation and indemnification arrangements and we have less control over these activities than we would have if we had full ownership and control. Our partners may have economic or business interests that are opposed to ours, and may exercise the right to block key decisions or actions. We believe the joint arrangement is in our best interest." Which of the following statements are correct?

Question14: V buys vegetables and fruit from three farms located in a different part of V's country and sells them to large supermarket chains.
A recent newspaper magazine had an article on these farms showing that the farms employ illegal immigrants whose status was used by the factory's owners to force them to work for low wages and in unpleasant conditions. They are forced to live in small overcrowded caravans with no running water. They are also given meals which are cold and poor quality. These farms are located in a developed country with strong labour laws.
Classify each of the following statements as true or false.

Question15: The long-term prospects for interest rates in the UK and the USA are 2% and 6% per annum respectively.
The GBP/USD spot rate is currently GBP/USD1.71.
Using interest rate parity theory, what GBP/USD spot rate would you expect to see in six months' time?

Question16: A project has been evaluated on the basis that it will cost $22 million and will have a net present value of $4.3 million The project has commenced and $5 million of the $22 million has been invested. A problem has been discovered that will cost an additional $4.5 million to rectify. The $4.5 million will be payable immediately.
What is the NPV of continuing with this project?

Question17: The internal audit department has just completed an investigation into the HR department's procedures relating to new staff appointments The head of HR is unhappy with the draft report prepared by the lead internal auditor The report lists several cases in which appointments were made despite the fact that one or more of the entity's formal procedures were not followed The head of HR has complained that the internal auditor's comments do not allow for the fact that the HR department's staff members are often very busy and do not always have time to conduct every check.
The internal auditor's comments also reflect a failure to complete documents None of the omissions have led to the appointment of an unsuitable member of staff Which TWO of the following statements reflect an appropriate response by the board of directors to this report?

Question18: CW is a large company in the food production industry. It has grown over the years by the acquisition of several smaller rivals CW has ten branches located in its home country and has just opened a foreign branch for the first time It has recently made some changes to the structure and implementation of its control system.
Which TWO of the following changes would be most likely to improve the overall control system?

Question19: A US company has to pay £500,000 for a new machine.
You have the following information on currencies.
EUR 1 = £1.2300
EUR 1 = USD 1.6200
What is the cost of the machine in USD?
Give your answer to the nearest $.

Question20: A government department is conducting a value for money audit on a school.
The school's pupils sit leaving exams. Classify each of the audit tests as either economy and efficiency or effectiveness.

Question21: S Doc is an out-of-hours service provided by a country's government. The service allows members of the public to call and speak to a nurse who can advise on medical situations which are not obviously emergencies.
Depending on the situation the caller can be referred to the full emergency services, or be advised to go to Accident and Emergency at the nearest hospital. Alternatively, a callout from a general practitioner (GP) can be organised; the caller can be advised of where GP services are available; advice can be given over the phone; or a decision can be taken that no further action is required at least until normal services resume on the next working day.
There has been a suggestion that the nurses who take these calls could be replaced by suitably trained operatives who have available to them a specially designed expert system.
Which of the following are advantages of using an expert system instead of nurses?

Question22: Which of the following statements are true of residual risk?

Question23: C is an accounts clerKwho is supposed to sign each invoice as evidence that she has conducted checks against supporting documents Sometimes C signs invoices without making these checks D is a member of the internal audit team He has been told to conduct compliance tests on whether C is checking the invoices property Which of the following would grve D a false sense of assurance that C's checks have been in operation?
Select ALL that appry

Question24: Z plc has recently undertaken a SWOT analysis. The SWOT analysis identified two main threats to Z plc:
* The threat that the currency of Z plc's main overseas competitor weakens compared to Z plc's home currency.
* The threat that there will be a military coup which will overthrow the government in the country that Z plc purchases most of its raw materials from.
Which TWO of the following categories of risk correspond most closely to the above threats?

Question25: H is a senior production manager for P Ltd which is about to make a strategic decision on setting up a new production line requiring $3 million of new specialist equipment.
H's daughter is friends with and goes to school with the daughter of T, the sales manager in KK Ltd. KK Ltd is a potential supplier of the specialist equipment that P Ltd requires.
T owns a holiday home. H's daughter regularly accompanies T's daughter on family vacations at this holiday home, all at T's expense.
H is the only person working for P Ltd who is qualified to select the specialist equipment. KK Ltd will definitely bid for the sale.
What should H do?

Question26: An electricity company owns and operates a nuclear power station located ten miles from a large city. A recent and very extensive engineering examination of the power station concludes with the estimate that the probability of a major nuclear disaster within the next 20 years is 0.2%.
Which of the following best explains the relevance of quantifying the risk in that way?

Question27: Which TWO of the following are NOT methods used for risk identification?

Question28: Amber selects appropriate suppliers and places purchase orders.
Brian passes invoices for payment and submits payment instructions to the bank.
Chris checks incoming inventory and unpacks goods from their containers.
Dirwan posts purchase invoices and files invoices and supporting documents.
Which member of staff could most easily commit fraud?

Question29: Company A's gross profit percentage has fallen from 70% to 61 % Which of the following possible explanations would most concern the internal auditors?

Question30: JNH is a major corporation that stores its customer database in the Cloud JNH has suffered a data breach that has led to customer credit card details being made available for sale on the internet JNH's Head of Security wishes to analyse network traffic at the cloud-based server in order to gain a better understanding of the manner in which the data was intercepted, but has been refused access.
Which of the following is the most likely explanation for the third-party owner's refusal to assist JNH's Head of Security?

Question31: T is an accountant who has been accused of professional incompetence T agreed to advise a client on currency management and the client lost a great deal of money when a large foreign currency trade receivable declined in value without having been hedged.
Which of the following factors strengthens the case that T has been incompetent?
Select ALL that apply

Question32: H Ltd is a logistics company which is likely to be seeking a Stock Exchange listing shortly. The directors wish to strengthen the company's internal controls.
Which of the following statements are valid?

Question33: Z is a multinational pharmaceuticals company with operations across Europe, America and Asia.
It is currently investigating the possibility of setting up a chemical and specialist production facility in South America. This would be a multi $billion investment. What steps should Z take to manage the following risks in this long term venture.

Question34: You are a member of the Chartered Institute of Management Accountants (CIMA) and you have recently taken up the position of Sales Manager with a company that is facing financial difficulties. The company's terms include a commitment to maintain specified profitability, liquidity and solvency measures; failure to do so would render bank loans immediately repayable. The draft financial statements show that the company has not succeeded in complying with all of these requirements.
The financial results are very dependent on various estimates such as receivables impairments. The Chief Executive Officer (CEO) has suggested that these be recalculated so as to bring the financial results within the requirements of the bank. He has asked you to sign pre-dated internal documentation which would imply that, as Sales Manager, you initiated these changes in the belief that they would enhance the accuracy of the Financial Statements.
Which TWO of the following courses of action available to you would be ethically acceptable according to the CIMA Code of Ethics?

Question35: RFG is considering a major expansion that will result in a more diversified business model.
At present, RFG's market capitalisation is $240 million. This is based on a beta of 1.6. The risk free rate is 4% and the market rate of return is 9%. RFG is financed entirely by equity. The company generates an annual cash surplus of $28.8 million.
The expansion will cost $50 million and will generate future cash flows of $12 million in perpetuity. This new business will reduce RFG's beta to 1.4.
Calculate the adjusted present value of the expansion.

Question36: You are a junior accountant in a local accountancy firm with many clients in various businesses.
Your immediate manager has asked you to collect certain personal details about clients' staff from the firm's records. You suspect that his intentions are malicious.
You asked your manager to explain why he required these details and he told you it is none of your business.
What should you do? Select TWO responses.

Question37: DFG's home currency is the D$.
DFG is heavily exposed to the exchange rate between the D$ and the L$, country L's currency. DFG's treasurer has noted the following:
* Inflation has been running at 5% in DFG's home country and 8% in country L
* Interest rates are 7% in DFG's home country and 11% in country L
* The spot rate is D$1.0000 = L$2.1000 and the three month forward rate is D$1.0 = L$2.1196 Which of the following statements is consistent with these figures?

Question38: TTO is seeking to recruit a new non-executive director TTO produces high quality women's clothing, which it sells to retailers Some clothing is sold under the retailer's own brand names, some is made on behalf of recognised clothing designers TTO is a well regarded company and its products are of a very high quality.
Several applications have been received, and the Board is seeking to make a shortlist by eliminating unsuitable candidates Which THREE of the following would make a candidate unsuitable for appointment to the post?

Question39: Which TWO of the following scenarios should be considered in strategic scenario planning by a publishing company that specialises in academic textbooks?

Question40: P has decided to invest in a new warehouse at a cost of $2,000,000. The discount rate of the project is 18% and the present value of the tax shield is £26,000.
What is the minimum acceptable Internal Rate of Return of the project?

Question41: Select the most appropriate level of responsibility for managing each of the following risks.

Question42: A's directors do not believe that they always get value for money from their investment in capital projects.
Over the past decade the company has invested in 55 projects that have cost more than $1m. They are considering introducing a system of post completion audit to see if this will help them to understand any problems they have had with projects in the past. They hope to use the results of the post completion audits to significantly improve the results of their capital investments State whether you agree or disagree with the points raised by A's directors.

Question43: VBN uses a balanced scorecard to monitor the performance of its divisions.
Classify each of the following decisions taken by a division's management team as either commercially sound or dysfunctional.

Question44: M plc has a $2 million loan outstanding on which the interest rate is reset every 6 months for the following 6 months and the interest is payable at the end of that 6-month period. The next 6-monthly reset period starts in
3 months and the treasurer of M plc thinks that interest rates are likely to rise between now and then.
Current 6-month rates are 7.2% and the treasurer can get a rate of 7.7% for a 6-month forward rate agreement (FRA) starting in 3 months' time. By transacting an FRA the treasurer can lock in a rate today of 7.7%.
If interest rates are 8.5% in 3 months' time, what will the net amount payable be?
Give your answer to the nearest thousand dollars.

Question45: You are the Management Accountant for a company which supplies baked food to a string of retail outlets; biscuits, cakes, savoury snacks etc.
You discover that a trainee employee, who is responsible for cleaning out the delivery vans has been taking damaged goods and packets which have reached their sales expiry date and has been selling them to friends.
These products would otherwise have been discarded as waste.
The trainee in question is the nephew of one of the senior managers.
What is the correct course of action?

Question46: P Ltd, a manufacturing company, is considering a new capital investment project to set up a new production line. The initial appraisal shows a healthy net present value of $6,465 million at a discount rate of 10% as shown in the table below:
However, management is unsure about the demand for the product which will be produced and has insisted that the future revenues should be reduced to certainity equivalents by taking 70%, 65% and 60% of the years
1,2, and 3 cash inflows respectively.
What should P do?

Question47: SDF is a quoted company that has a large internal audit department.
Which of the following would impair the independence of SDF's internal audit?

Question48: A project requires a capital investment of £2.7million. The project will save £450,000 each year after taxation.
Assume the savings are in perpetuity. The business risk of the venture requires a 15% discount rate. The company has to borrow £1million to finance the project at a rate of 9% and the net tax shield is 30%, the project supports debt which generates an interest tax shield of 0.30 x 0.09 x £1million, which is £27,000 per year in perpetuity.
Calculate the project's adjusted present value.

Question49: A company is keen to avoid becoming a victim to malware. Which TWO of the following techniques would be valid responses to this threat?

Question50: YUI owns 18 factories, which are spread around the country. Each factory employs 500-700 production staff and has its own administrative and accounts departments.
It has recently been discovered that the manager in charge of YUI's Hightown factory has been overstating his personal expenses claims for the past five years. The total amount stolen in this manner has been estimated at
$10,000.
Why would it have been relatively difficult to have prevented this fraud?

Question51: A government department is conducting a value for money audit on a school.
The school's pupils sit leaving exams. Classify each of the audit tests as either economy and efficiency or effectiveness.

Question52: Identify, from the list provided, which category of business risk most accurately describes the events detailed below.

Question53: E purchases parts for one of the machines it manufactures from Country X Place the risk classification next to the risk it relates to:

Question54: Which risks should be given the highest priority?

Question55: Move the category of risk to the box beside the risk description it best matches.

Question56: H manufactures and sells healthy dietary supplements. The company recruits individuals as part-time agents to sell its products to friends and colleagues. These agents are required to buy H's products and to resell them at a small mark-up.
For a fee, H will provide agents with training in persuasive selling techniques. Agents who pass exams at the conclusion of this training can become distributors. Distributors buy bulk quantities of H's products at a discount and can recruit their own sales agents. Those agents can also take training and can recruit agents of their own.
At what stage does H stop being a legitimate business and become a pyramid selling fraud?

Question57: You are the Management Accountant for P, a food manufacturing company with an annual sales revenue of $5 million.
You discover that the Production Manager's records are inconsistent. Raw materials purchased do not agree to the total recorded for transfers to production plus wastage. There is an average shortfall of 2% of purchases.
You investigated and discovered that there are often mistakes made during manufacturing that results in food that is safe to eat, but cannot be sold because of visual flaws. The Production Manager is supposed to scrap all such damaged product and write all such losses off as waste, but you discovered that he has been giving the damaged food to a charity that assists homeless people. No records are made of such gifts in order to conceal the losses due to manufacturing errors.
What should you do?

Question58: Y Company wishes to recruit an employee who will have responsibility for the receipt and handling of cash From the point of view of the internal auditor which THREE of the following would be most likely to provide useful information about the candidate"?

Question59: Having carried out a full capital appraisal for a construction project, H Company has approved the project with initial outflows of $6,000,000 and a net present value of $1,200,000.
The implementation phase has been commenced with 25% of the costs already committed. However when the ground was opened, an underground waterway was revealed which will need to be diverted if the project is to proceed. Work to carry out this diversion has been estimated at $1,300,000.
Which of the following factors will define whether the project should go ahead or not?

Question60: James owns a small company which sometimes suffers from credit risk.
Which of the following measures should he put in place to help reduce this risk?

Question61: Kate is a management accountant. Her immediate superior plans to apply for a promotion and his strongest competitor is the sales manager. Kate's superior has ordered her to set unattainable sales targets in a sales budget in order to reduce the sales manager's promotion prospects. He told her not to tell anybody.
Kate asked the finance director for advice. He told her that he wanted her immediate superior to get the promotion and so she should set the unattainable budget as instructed.
Kate set the budget as instructed.
Which THREE fundamental ethical principles has Kate breached?

Question62: B is a small retail bank that offers customers many on-the services B is keen to ensure sound security both to protect the bank's assets and also to safeguard customer privacy B's IT Security Manager has suggested that the bank should use two phase authentication for access to the on-line systems Which TWO of the following are examples of two phase authentication?

Question63: TT is a jewellery manufacturer in country A It makes jewellery from precious metals and stones and sells it to shops in country A and also overseas It is the 3rd largest company in country A with a huge turnover TT has found it very difficult to prevent staff committing fraud and last year the Board was sure that the year end inventory was lower than it should have been Gross profit was also slightly lower than expected Which TWO of the following internal controls would be most effective in helping to reduce staff fraud within TT?

Question64: Match the descriptions shown in the boxes below with the method of quantifying risk exposure it best describes.

Question65: Achieving the budget is often used as a good performance measure. However, there are problems with budgets which may mean they are not always good measures of performance.
Which TWO of the following statements about budgets suggest that they should not always be used to measure performance?

Question66: TLY sell building materials such as bricks sacks of concrete and paving slabs to builders Materials are kept in a large yard Customer orders are fulfilled by a team of 30 employees who use forklift trucks to move sold items to the loading bay, from where they are loaded onto lornes for dispatch to the customer The sales office prepares dispatch notes, which are used by the yard employees to identify the items that have been ordered Which TWO of the following controls would be cost-effective ways to prevent the theft of inventory by TLY's staff?

Question67: AZX sells electrical components.
AZX's annual turnover is S24 million. Half of all sales are on 30 days' (1 month) credit
5% of credit sales have to be written off as unrecovered debt
25% of such write off is subsequently recovered through debt collection and legal action.
What is the expected loss each year due to credit risk?

Question68: H sells machinery and also associated services, such as advice and repairs. H's industry is going through considerable transformation.
Classify each of the examples of information available to H's management as strategic, operational or of having little value.

Question69: TYU is a retailer selling televisions. The company is financed wholly by equity.
Why might TYU be exposed to interest rate risk?

Question70: M, a manufacturing company, has had some problems with defects in one of the main products it produces.
This product has been made by the company for many years and is very profitable. Last month it had over 300 defects reported by customers which is more than 15% of products sold. This is a reputation risk for M and is also affecting profitability.
Which of the following controls could M introduce to reduce defects and also increase profitability?

Question71: The interest rate on EUR deposits is 7%. The interest rate on GBP deposits is 5%. The spot rate is EUR/GBP0.8500. What is the one year forward rate predicted to be assuming interest rate parity holds true?

Question72: A UK manufacturing company has simultaneously:
* purchased a put option to sell USD 1million at an exercise price of GBP1.00 = USD1.65
* sold a call option that grants the option holder the right to buy USD 1million at a price of GBP1.00 = USD1.61 (this option has the same maturity date as the put).
Which of the following is a valid explanation for entering into these option positions?

Question73: University B has several departments. Each department at times obtains funding from different sources such as government grants and industry sponsorships. The central management of the university has decided to develop a module within its current Information System to track these funds centrally.
The central management of the University has decided to utilise in-house expertise in order to build this module.
Which THREE of the following represent advantages of developing this module and doing so using in-house expertise?

Question74: H sells machinery and also associated services, such as advice and repairs. H's industry is going through considerable transformation.
Classify each of the examples of information available to H's management as strategic, operational or of having little value.

Question75: JC is a car manufacturing company in country C and manufactures diesel cars It is facing a number of serious risks Which TWO of the following risk factors are external?

Question76: The internal audit department should always give a report at the end of its audit. This report is intended to be useful and help the company going forward. The report should always include any recommendations for improvements. Which of the following statements are true and which are false?

Question77: As part of risk assessment exercise for a low-cost airline you are requested to match the risks listed below with the most approriate method of minimising or dealing with each risk.

Question78: Which of the following risks should be given highest priority?

Question79: A consultancy firm has many overseas clients The firm's staff are responsible for booking travel and accommodation through an independent travel agent who invoices the firm. There are strict rules governing bookings Staff at all levels must book economy class airfares unless the scheduled flight time is greater than eight hours, in which case they can book a business class seat Hotel accommodation should cost less than $300 per night One of the firm's directors is visiting the consultancy team responsible for a large overseas project The director flew business class, even though the flight took only five hours The director is booked into an executive suite at an expensive hotel at a cost of $900 per night Which TWO of the following statements concerning the director's behavior are correct?

Question80: A has an opportunity to invest $90,000 in a project that is expected to generate annual cash inflows of $60,000 for each of the next three years. The project's beta coefficient implies a discount rate of 12% for this project, based on a risk-free rate of return of 3%.
A is prepared to forego the expected cash flows from this project in return for a guaranteed payment of
$50,000 at the end of year 1, $42,000 at the end of year 2 and $30,000 at the end of year 3.
What is the certainty equivalent value of this opportunity to A?

Question81: Move the category of risk to the box beside the risk description it best matches.

Question82: Why do businesses take risks?
Select the TWO correct answers.

Question83: XYZ is unhappy with the way it decides on the likelihood and impact of risks when it completes the TARA matrix XYZ has decided to try other ways to get more consensus over the evaluation of risks as high, medium and low impact and likelihood Which of the following methods is likely to be most successful?

Question84: UIO designs clothes and pays third parties to manufacture them A recent television programme showed that two of the factories used by UIO were employing illegal immigrants whose status was used by the factory's owners to force them to work for low wages and in unpleasant and dangerous conditions. These factories were located in a developed country with strong labour laws Classify each of the following statements as true or false:

Question85: HJK is a publishing company that employs several hundred staff A member of the company's IT Security Department contacted 30 members of HJK's staff selected at random, and told each one that his or her computer appeared to be infected with a virus The staff members were asked to provide their login details and corporate passwords so that IT Security could remove the virus remotely A total of six members of staff provided this information.
Which TWO of the following statements are correct?

Question86: G plc has decided to move its production plant to overseas Country A.
This would make the product cheaper to produce. The technology used to make the product is very advanced and some of the staff would have to move to Country A.
The Production Director has identified that there are some political risks in moving to Country A.
Match the methods of reducing the political risks associated with the move to Country A with the corresponding risks.

Question87: DRF is a manufacturing company
The internal auditor is conducting an investigation into the operation of the payroll system and has discovered a compliance error The Head of Human Resources (HR) is required to add any new names to the payroll, using a specific computer password The Head of HR was absent for a month because of ill health During that period a senior member of the Wages Office, who is normally responsible only for organising wage payments, was issued a temporary password in order to add new names to the payroll The password was cancelled when the Head of HR returned to work Which TWO of the following statements are correct?

Question88: BCD has set up a number of functions within its security operations centre (SOC) One of these is a Hunt team.
Which of the following is the primary function of a Hunt team?

Question89: The Committee of Sponsoring Organisations (COSO) outlined six key principles of Enterprise Risk Management (ERM).
Which of the following are COSO key principles?

Question90: A publicly funded hospital has put various features in place in an attempt to improve strategic control and create an improved control environment.
Which TWO of the following features are most likely to meet this objective?

Question91: The list below has duties performed by risk managers and internal auditors. Show who would carry out the duties assuming the company has both risk managers and internal auditors.

Question92: TRF is conducting a post completion audit on an investment in a pollution control machine that has reached the end of its five year useful life.
TRF could have been heavily fined if the machine had failed to keep pace with the output of emissions, measured in units. TRF's cost of capital is 10%. When the machine was purchased, there was a choice of three machines on the market:
TRF purchased the Big machine, but annual requirements only exceeded 600,000 once, in year 3, when
720,000 units of emissions were emitted.
Calculate the amount that the post completion audit shows TRF overpaid for the ownership costs associated with this machine.
Give your answer to the nearest whole $ (in $'000s).

Question93: Smalltown had a problem with people parking cars on the town's mam shopping streets instead of in the nearby car parks The parked cars created congestion and made it difficult for delivery vehicles to unload Smalltown's local government had employed traffic wardens to enforce parking regulations by issuing parking fines to motorists who parked for more than the permitted 30 minutes.
The local government took further action to deal with this problem It banned parking on the busiest streets, it introduced parking charges in the remaining streets and it made it free to park m the town's car parks for up to two hours Fewer people now park cars on the streets because of the charges, but those who do generate significant revenues for the local government Fewer traffic wardens are required and so wage costs have reduced The local goverment auditors have decided to carry out a value for money audit of the parking system Which of the following is a measure of effectiveness?

Question94: BCD has recently experienced a cyber security breach which fortunately was carried out by someone more interested in demonstrating the weakness in its defence than by someone malicious This has made BCD realise that its cyber defence is inadequate BCD has engaged a cyber security consultant who has advised BCD to set up a Computer Incident Response Team (GIRT) What THREE of the following activities would this CIRT have responsibility for?
Recruit specialist security staff to avoid an incident

Question95: T has its computer facilities in a building adjacent to its headquarters Severe structural problems have been discovered with this building and T has been advised that the only option is demolition and rebuild This leaves T with strategic decisions to make about its IT provision and it has decided to investigate the outsourcing of its services Which TWO of the following factors should T consider as most important at this stage?

Question96: The senior manager in the accounts department is going on annual leave for three weeks and Jo, a supervisor is being put in charge of the department for that time.
Which TWO of the following statements are correct?

Question97: KLO is a major quoted car rental company The company is considering publishing its first cyber risk management report AH rental bookings are made online Customers receive a booking reference number that they use to collect their cars from a convenient branch Customers enter their credit card details both so that KLO can take payment for their rental and also so that the customers can be charged automatically for late returns or damage to cars KLO's management believes that it has three key areas of cyber risk Cyber criminals may wish to make bookings using fictitious data in order to steal KLO's cars, they may wish to use customers details to identify addresses of people who are away from home so that they can burgle houses and they may wish to abuse customer credit card details KLO's Board is concerned that admitting to the nsk of stealing cars might encourage cnminals to exploit that vulnerability AJso. it is concerned that customers will be reluctant to rent cars if that would mean that their homes could be at risk of burglary while they are away The vulnerability of credit card details seems obvious and so the Board is not reluctant to admit to that.
Which TWO of the following are correct?

Question98: B uses a balanced scorecard to monitor the performance of its divisions.
Classify each of the following decisions taken by a division's management team as either commercially sound or dysfunctional.

Question99: B uses a balanced scorecard to monitor the performance of its divisions.
Classify each of the following decisions taken by a division's management team as either commercially sound or dysfunctional.

Question100: Which of the following statements concerning the use of balanced scorecards to measure divisional performance is correct?