Certified Public Accountant Technology & Digital Applications 5

Question 1

A CPA advising a client on digital transformation notes the client plans to use APIs to integrate its ERP with a third-party payment processor. The MOST important control to recommend is:

Accepted Answer

API authentication tokens with expiration and least-privilege access scopes

Answer

API security requires authenticated, scoped tokens with expiration so that only authorized systems can initiate transactions and compromised tokens have limited lifespan and capability.

Question 2

In a SOC 1 Type II engagement, the service auditor's report covers which of the following?

Accepted Answer

The service organization's controls over financial reporting relevant to user entities' ICFR, tested over a specified period

Answer

A SOC 1 Type II report describes and tests the operating effectiveness of a service organization's controls relevant to user entities' internal control over financial reporting over a defined period.

Question 3

Which of the following represents a 'preventive' IT control rather than a 'detective' IT control?

Accepted Answer

User access restrictions preventing unauthorized transactions from being entered

Answer

Preventive controls stop problems before they occur; restricting access prevents unauthorized users from entering transactions, while detective controls identify issues after the fact.

Question 4

A company implements multi-factor authentication (MFA) for all financial system logins. This control PRIMARILY mitigates which risk?

Accepted Answer

Account takeover through compromised passwords alone

Answer

MFA requires a second verification factor beyond a password, so stolen or guessed credentials alone are insufficient for an attacker to gain access.

Question 5

When auditing a company that uses machine learning models to estimate the allowance for doubtful accounts, the CPA's MOST important procedure is to:

Accepted Answer

Assess the model's inputs, assumptions, and validation testing to evaluate the reasonableness of the output

Answer

The auditor must understand and challenge the ML model's inputs and assumptions because biased training data or flawed logic can produce materially misstated accounting estimates.

Certified Public Accountant Practice Test

Certified Public Accountant Practice Test

Certified Public Accountant Technology & Digital Applications 5