CISA Certified Information Systems Auditor Question and Answers

A balanced scorecard is a framework that translates the IT strategy into measurable objectives, indicators, targets, and initiatives across four perspectives: financial, customer, internal process, and learning and growth. A balanced scorecard helps to monitor and evaluate how well the IT function is delivering value to the organization, achieving its strategic goals, and improving its capabilities and competencies. The other options are not the primary uses of a balanced scorecard, because they either focus on specific aspects of IT rather than the overall performance, or they are not directly related to the IT strategy.

 The most important thing for an IS auditor to verify when evaluating an organization’s data conversion and infrastructure migration plan is that a rollback plan is included. A rollback plan is a contingency plan that describes the steps and actions to be taken in case the data conversion or infrastructure migration fails or causes unacceptable problems or risks. A rollback plan can help to restore the original data and infrastructure, minimize the impact on the business operations and functions, andensure the continuity and availability of the IT services. The IS auditor should verify that the rollback plan is feasible, tested, documented, and approved, and that it covers all the possible scenarios and outcomes of the data conversion or infrastructure migration. Theother options are not as important as verifying the rollback plan, because they either do not address the potential failure or disruption of the data conversion or infrastructure migration, or they are partof the normal planning and execution process rather than a contingency plan. References: CISA Review Manual (Digital Version)1, Chapter 4, Section 4.2.3

The use of access control lists (ACLs) is the most effective method to mitigate security risk for routers because they can limit Telnet and traffic from the open Internet. Telnet is a protocol that allows remote access to a device, which can pose a security threat if not properly controlled. Traffic from the open Internet can also contain malicious packets that can harm the network or the router itself. ACLs act as filters that can block or allow specific types of traffic based on predefined criteria, such as source and destination addresses, protocols, ports, and flags. By using ACLs, routers can prevent unauthorized access and reduce the exposure to potential attacks.

References:

Protecting Your Core: Infrastructure Protection Access Control Lists

Definition, purposes, benefits, and functions of ACL

CISA Review Manual 27th Edition, page 336

Substantive testing is the most important type of testing during software license audits, as it provides evidence of the accuracy and completeness of the software inventory and licensing records. Substantive testing involves examiningtransactions, balances, and other data to verify their validity, existence, accuracy, and valuation. Compliance testing, on the other hand, is more focused on assessing the adequacy and effectiveness of internal controls over software licensing, such as policies, procedures,and monitoring mechanisms. Compliance testing alone cannot provide sufficient assurance that the software license audit objectives are met, as itdoes notverify the actual software usage and compliance status. Judgmental sampling and stop-or-go sampling are methods of selecting samples for testing, not types of testing themselves. *References: According to the ISACA IT Audit and Assurance Standards, Guidelines and Tools and Techniques for IS Audit and Assurance Professionals, section1206 Testing, “The IS audit and assurance professional should perform sufficient testing to obtain sufficient appropriate evidence to support conclusions reached.” 1 The section also defines substantive testing as “testing performed to obtain audit evidence to detect material misstatements in transactions orbalances” and compliance testing as “testing performed to obtain audit evidence on theoperating effectiveness of controls.” 1 According to the ISACA IT Audit and Assurance Guideline G15 Software License Management, “The objective of a software license auditis to provide management with an independent assessment relating to compliance with software license agreements.” 2 The guideline also states that “substantive tests should be performed on a sample basis to verify that all software installed on devices within scope has been appropriately licensed.” 2

The best way for the auditor to address this issue is to verify management has approved a policy exception to accept the risk. A policy exception is a formal authorization that allows a deviation from the established policy requirements for a specific situation or period of time. A policy exception should be based on a risk assessment that evaluates the impact and likelihood of the potential threats and vulnerabilities, as well as the cost and benefit of the alternative controls. A policy exception should also be documented, approved, and monitored by management.

Recommending the application be patched to meet requirements is not the best way for the auditor to address this issue. Patching the application may not be feasible, cost-effective, or timely, given that the application will be decommissioned in three months. Patching the application may also introduce new risks or errors that could affect the functionality or performance of the application.

Informing the IT director of the policy noncompliance is not the best way for the auditor to address this issue. Informing the IT director of the policy noncompliance may not resolve the issue or mitigate the risk, especially if the IT director is already aware of the situation and has decided to accept it. Informing the IT director of the policy noncompliance may also create unnecessary conflict or tension between the auditor and the auditee.

Taking no action since the application will be decommissioned in three months is not the best way for the auditor to address this issue. Taking no action may expose the organization to significant risks or consequences, such as data breaches, regulatory fines, or reputational damage, if the application is compromised or exploited by malicious actors. Taking no action may also violate the auditor’s professional standards and responsibilities, such as due care, objectivity, and reporting.

References:

ISACA, CISA Review Manual, 27th Edition, 2019, p. 289

ISACA, CISA Review Questions, Answers & Explanations Database - 12 Month Subscription

Cybersecurity Engineering for Legacy Systems: 6 Recommendations - SEI Blog

How to Secure Your Company’s Legacy Applications - iCorps

The greatest risk if two users have concurrent access to the same database record is data integrity. Data integrity is the property that ensures that the data is accurate, complete, consistent, and valid throughout its lifecycle. If two users have concurrent access to the same database record, they may modify or delete the data in a conflicting or inconsistent manner, resulting in data corruption, loss, or duplication. This can affect the reliability and quality of the data, and cause errors or anomalies in the database operations and functions. The IS auditor should verify that the database has adequate controls to prevent or resolve concurrent access issues, such as locking mechanisms, transaction isolation levels, concurrency control protocols, or timestamping methods. References: CISA Review Manual (Digital Version)1, Chapter 5, Section 5.2.7

 The most useful analytical method when trying to identify groups with similar behavior or characteristics in a large population is classification. Classification is a technique that assigns data points to predefined categories or classes based on their features or attributes. Classification can help to discover patterns, trends, and relationships among the data and reveal the similarities or differencesamong the groups. Classification can also help to support decision making, prediction, or recommendation based on the data analysis. References:

CISA ReviewManual (Digital Version), Chapter 3, Section 3.4.21

CISA Online Review Course, Domain 2, Module 3, Lesson 12

 When auditing the closing stages of a system development project, the most important consideration should be the user acceptance test (UAT) results. The UAT is a critical phase of the system development life cycle (SDLC) that ensures that the system meets the functional requirements and expectations of the end users. The UAT results provide evidence of the system’s quality, performance, usability, and reliability. Control requirements, rollback procedures, and functional requirements documentation are also important considerations, but they are not ascrucial as the UAT results in determining if the system is ready for deployment. References: CISA Review Manual (Digital Version)1, page 325.

 A disaster recovery plan (DRP) is a set of detailed, documented guidelines that outline a business’ critical assets and explain how the organization will respond to unplanned incidents. Unplanned incidents or disasters typically include cyberattacks, system failures, power outages, natural disasters, equipment failures, or infrastructure damage1. A DRP aims to minimize the impact of a disaster on the business continuity, data integrity, and service delivery of the organization. A DRP also helps the organization recover from a disaster as quickly and efficiently as possible.

A DRP should include steps for obtaining replacement supplies, as this is an essential part of restoring the normal operation of the organization after a disaster. Replacement supplies may include hardware, software, data, network components, office equipment, or other resources that are needed to resume the business functions and processes that were disrupted by the disaster. Obtaining replacement supplies may involve contacting vendors, suppliers, or partners; activating backup or alternative systems; orpurchasing or renting new equipment. A DRP should identify the sources, locations, and costs of the replacement supplies, as well as the procedures and responsibilities for acquiring and installing them.

The other three options are not steps that a DRP should include, as they are either part of the pre-disaster planning process or not directly related to the disaster recovery objectives. Assessing and quantifying risk is a step that should be done before creating a DRP, as it helps identify the potential threats and vulnerabilities that could affect the organization and determine the likelihood and impact of each scenario2. Negotiating contracts with disaster planning consultants is also a pre-disaster activity that may help the organization design, implement, test, and maintain a DRP with external expertise and guidance3. Identifying application control requirements is not a step in a DRP, but rather a part of the application development and maintenance process that ensures the quality, security, and reliability of the software applications used by the organization.

Therefore, obtaining replacement supplies is the correct answer.

References:

What is a DisasterRecovery Plan? + Complete Checklist

Risk Assessment- ISACA

Disaster Recovery Planning - ISACA

[Application Controls - ISACA]

Whenclassifying information, it is most important to align the classification to business risk, because it ensures that the information is protected according to its value andimpact to the organization34. Business risk considers factors such as legal, regulatory, contractual, operational, reputational, and financial implications of information disclosure or compromise34. Aligning information classification to business risk also helps to prioritize and allocate resources for information security measures. Security policy, data retention requirements, and industry standards are important considerations for information classification, but not as important as business risk. References: 3: CISA Review Manual(Digital Version), Chapter 5, Section 5.4.2 4: CISA Online Review Course, Module 5, Lesson 4

The best situation that justifies the use of a smaller sample size when testing the accuracy of transaction data is B. It is expected that the population is error-free. The sample size is the number of items selected from the population for testing. The sample size depends on various factors, such as the level of confidence, the tolerable error rate, the expected error rate, and the variability of the population. A smaller sample size means that fewer items are tested, which reduces the cost and time of testing, but also increases the sampling risk (the risk that the sample is not representative of the population).

One of the factors that affects the sample size is the expected error rate, which is the auditor’s best estimate of the proportion of errors in the population before testing. A higher expected error rate means that more errors are likely to be found in the population, which requires a larger sample size to provide sufficient evidence for the auditor’s conclusion. A lower expected error rate means that fewer errors arelikely to be found in the population, which allows a smaller sample size to provide sufficient evidence for the auditor’s conclusion. Therefore, if it is expected that the population is error-free (i.e., the expected error rate is zero or very low), a smaller sample size can be justified.

The other situations do not justify the use of a smaller sample size when testing the accuracy of transaction data. A. The IS audit staff has a high level of experience. The IS audit staff’s level of experience does not affect the sample size, but rather their ability to design and execute the sampling procedures and evaluate the results. The IS audit staff’s level of experience may affect their judgment in selecting and applying sampling methods, but it does not change the statistical or mathematical principles that determine the sample size. B. Proper segregation of duties is in place. Proper segregation of duties is an internal control that helps prevent or detect errors or fraud in transaction processing, but it does not affect the sample size. The sample size is based on the characteristics of the population and the objectives of testing, not on the controls in place. Proper segregation of duties may reduce the likelihood or impact of errors or fraud in transaction processing, but it does not eliminate them completely. Therefore, proper segregation of duties does not justify a smaller sample size when testing the accuracy of transaction data. C. The data can be directly changed by users. The data’s ability to be directly changed by users does not justify a smaller sample size, but rather a larger one. The data’s ability to be directly changed by users increases the risk of errors or fraud in transaction processing, which requires a larger sample size to provide sufficient evidence for the auditor’s conclusion. The data’s ability to be directly changed by users also increases the variability of the population, which affects the sample size.

References:

ISACA, CISA Review Manual, 27th Edition, 2019, p. 2471

ISACA, CISA Review Questions, Answers & Explanations Database- 12 Month Subscription2

Audit Sampling - AICPA3

How to choose a sample size (for the statistically challenged)

 A checksum is classified as a detective control. A checksum is a mathematical value that is calculated from a data set and used to verify the integrity of the data. A checksum can detect if the data has been altered or corrupted during transmission or storage. A checksum does not prevent or correct the data corruption, but it alerts the user or system of the problem. Therefore, it is a detective control. A preventive control is a control that prevents an error or incident from occurring. A corrective control is a control that restores normal operations after an error or incident has occurred. Anadministrative control is a controlthat involves policies, procedures, standards, guidelines, or organizational structures. References: CISA Review Manual (Digital Version)1, page 439.

Comprehensive and Detailed Step-by-Step Explanation:

Thebest protectionfor a stolen laptop isfull disk encryption, which prevents unauthorized accesseven if the device is lost.

Option A (Incorrect):Remote wipe capabilitiesare useful, but theyrequire an internet connectionto function, which is not always available when a device is stolen.

Option B (Correct):Full disk encryption (FDE)ensures that data remainsunreadablewithout the correct decryption key,even if the hard drive is removed.

Option C (Incorrect):User awarenessis helpful, but itdoes not physically securedata on a lost device.

Option D (Incorrect):Password-protected filescan be bypassed by copying them to another system, making them an inadequate security measure.

Information systems governance is the set of policies, processes, structures, and practices that ensure the alignment of IT with business objectives, the delivery of value from IT investments, the management of IT risks, and the optimization of IT resources1. Information systems governance is a strategic and high-level function that covers the entire organization and its IT portfolio. Therefore, an IS auditor should review the aspects of information systems governance that are relevant to the organization’s vision, mission, goals, and strategies.

One of the aspects that an IS auditor should review when evaluating information systems governance for a large organization is the approval processes for new system implementations. This is because new system implementations are significant IT investments that require careful planning, analysis, design,development, testing, deployment, and evaluation to ensure that they meet the business requirements, deliver the expected benefits, comply with the relevant standards and regulations, and minimize the potential risks2. The approval processes fornew system implementations should involve the appropriate stakeholders, such as senior management, business owners, IT managers,project managers, users, and auditors, who have the authority and responsibility to approve or reject theproposed system implementations based on predefined criteria and metrics3. The approval processes for new system implementations should also be documented, transparent, consistent, and timely to ensure accountability and traceability4. Therefore, an IS auditor should review the approval processes for new system implementations to assess whether they are aligned with the information systems governance framework and objectives.

The other possible options are:

Procedures for adding a new user to the invoice processing system: This is an operational task that involves granting access rights and permissions to a specific user for a specific system based on the principle of least privilege. This is not a strategic or high-level function that falls under information systems governance. Therefore, an IS auditor should not review this aspect when evaluating information systems governance for a large organization.

Approval processes for updating the corporate website: This is a tactical task that involves making changes or enhancements to the content or design of the corporate website based on the business needs and feedback. This is not a strategic or high-level function that falls under information systems governance. Therefore, an IS auditor should not review this aspect when evaluating information systems governance for a large organization.

Procedures for regression testing system changes: This is a technical task that involves verifying that existing system functionalities are not adversely affected by new system changes or updates. This is not a strategic or high-level function that falls under information systems governance. Therefore, an IS auditor should not review this aspect when evaluating information systems governance for a large organization. References: 1: What is IT Governance? - Definition from Techopedia 2: System Implementation - an overview | ScienceDirect Topics 3: Project Approval Process - Project Management Knowledge 4: 5 Best Practices For A Successful Project Approval Process | Kissflow Project : Principle of Least Privilege (POLP) | Imperva : How to Update Your Website Content - 7 Step Guide | HostGator Blog : What Is Regression Testing? Definition & Best Practices | BrowserStack

In reviewing the IT strategic plan, the IS auditor should consider whether it identifies the major IT initiatives that are aligned with the organization’s vision, mission, and objectives, and that support the business strategy and priorities12. The major IT initiatives should also be realistic, measurable, and achievable, and should have clear timelines, budgets, and responsibilities34.

References

1: IT Strategy Template for a Successful Strategic Plan | Gartner2 2: IT Strategy Template for a Successful Strategic Plan | Gartner4 3: Conduct a Strategic Plan Review & Assessment - Governance3 4: Time To Conduct A Strategy Review? Here’s How To Get Started1

Comprehensive and Detailed Step-by-Step Explanation:

Aligning IT with business strategy ensures that IT investments provide value and support business objectives.

Option A (Incorrect):While senior management involvement is essential, it is abyproductof alignment rather than the primary goal.

Option B (Correct):Themain purposeof alignment is tooptimize IT investmentsby ensuring that IT initiatives directly support business needs, reducing waste and improving ROI.

Option C (Incorrect):Risk awareness is important but is not theprimaryreason for IT-business alignment.

Option D (Incorrect):Monitoring IT effectiveness is part of governance but not the main objective of IT-business alignment.

 The most important thing to determine when conducting a post-implementation review is whether success criteria have been achieved. A post-implementation review is a process of evaluating the results and outcomes of a project or initiative after it has been completed and implemented. The success criteria are the measurable indicators that define what constitutes a successful project or initiative in terms of its objectives, benefits, quality, performance, and stakeholder satisfaction. The IS auditor should verify whether the success criteria have been achieved by comparing the actual results and outcomes with the expected or planned ones, and by assessing whether they meet or exceed the expectations and requirements of the stakeholders. The IS auditor should also identify any gaps, issues, or risks that may affect the sustainability or scalability of the project or initiative, and provide recommendations for improvement or remediation. The other options are not as important as determining whether success criteria have been achieved when conducting a post-implementation review, because they either focus on specific aspects or components of the project or initiative rather than theoverall value proposition, or they are part of the pre-implementation or implementation phases rather than the post-implementation phase. References: CISA Review Manual (Digital Version)1, Chapter 4, Section 4.2.3

The correct answer is D. Maintenance procedures should be considered when examining fire suppression systems as part of a data center environmental controls review. Fire suppression systems are critical for protecting the data center equipment and personnel from fire hazards. Therefore, they should be regularly maintained and tested to ensure their proper functioning and compliance with safety standards. Maintenance procedures should include inspection, cleaning, replacement, and repair of the fire suppression system components, as well as documentation of the maintenance activities and results. Installation manuals, onsite replacement availability, and insurance coverage are notdirectly related to the fire suppression system performance and effectiveness, and therefore are not relevant for the audit review. References: CISA Review Manual (Digital Version)1, page 403.

 The best recommendation for an organization that does not have a process to identify and correct records that do not get transferred to the receiving system is to implement software to perform automatic reconciliations of data between systems. This will ensure that the data integrity and completeness are maintained and that any errors or discrepancies are detected and resolved in a timely manner. Enabling encryption, decryption, and electronic signing of data files may enhance the data security and authenticity, but not the data accuracy or consistency. Having coders perform manual reconciliation of data between systems may be prone to human errors and inefficiencies. Automating the transfer of data between systems as much as feasible may reduce the chances of data loss or corruption, but not eliminate them completely. References: ISAudit and Assurance Standards, section “Standard 1202: Risk Assessment in Planning”

A demilitarized zone (DMZ) is a network segment that is separated from the internal network and the external network, such as the internet, by firewalls or other security devices. A DMZ provides an extra layer of security for the organization’s internal network by isolating the servers and services that need to be accessible to external users, such as a file server, from the rest of the network. A DMZ also prevents external users from accessing the internal network directly, as they have to go through two firewalls to reach it. Therefore, setting up a DMZ is an IS auditor’s best recommendation to protect anorganization from attacks when its file server needs to be accessible to external users12.

The other possible options are:

Enforce a secure tunnel connection: This means that the organization requires external users to establish a secure and encrypted connection, such as a virtual private network (VPN), to access its file server. This can provide some level of security and privacy for the data transmission, but it does not protect the file server or the internal network from attacks if the connection is compromised or if the external users are malicious. Therefore, enforcing asecuretunnel connection is not an IS auditor’s best recommendation to protect an organization from attacks when its file server needs to be accessible to external users3.

Enhance internal firewalls: This means that the organization improves the security and performance of its internal firewalls, which are devices that filter and control the network traffic between different segments of the network. This can provide some level of protection for the internal network from unauthorized or malicious access, but it does not protect the file server or the external network from attacks if the file server is exposed to the internet or if the external network is compromised. Therefore, enhancing internal firewalls is not an IS auditor’s best recommendation to protect an organization from attacks when its file server needs to be accessible to external users4.

Implement a secure protocol: This means that the organization uses a secure and standardized protocol, such as Secure File Transfer Protocol (SFTP) or Secure Shell (SSH), to transfer files between its file server and external users. This can provide some level of security and integrity for the data transmission, but it does not protect the file server or the internal network from attacks if the protocol is exploited or if the external users are malicious. Therefore, implementing a secure protocol is not an IS auditor’s best recommendation to protect an organization from attacks when its file server needs to be accessible to external users5. References: 1: What Is a DMZ Network and Why Would You Use It? | Fortinet 2: Demilitarised zone (DMZ) | Cyber.gov.au 3: What Is VPN Tunneling? | Fortinet 4: Firewall - Wikipedia 5: Secure Shell - Wikipedia

The management decision that presents the greatest risk associated with data leakage is not providing security awareness training to staff. This is because staff are often the weakest link in the information security chain, and they may unintentionally or maliciously leak sensitive data through various channels, such as email, social media, cloud storage, or removable media. Security awareness training is essential to educate staff on the importance of protecting data, the policies and procedures for handling data, and the best practices for preventing and reporting data leakage incidents. Not requiring desktops to be encrypted, allowing staff to work remotely, and not updating security policies in the past year are also management decisions that may increase the risk of data leakage, but they are not as significant as not providing security awareness training to staff. Encryption, remote work, and security policies are technical or administrative controls that can be implemented or enforced by management, but they cannot fully prevent or mitigate human errors or malicious actions by staff. References: CISA Review Manual (Digital Version), [ISACA Privacy Principles and Program Management Guide]

The primary focus of the IS auditor reviewing the first year of the project should be regression testing. Regression testing is a type of testing that ensures that the existing functionality of the system is not affected by the changes or upgrades made to the system. Since the project involves upgrading the ERP system hosting the general ledger, which is a critical and complex component of the finance department, it is important to verify that the upgrade does not introduce any errors or defects that could compromise the accuracy, completeness, and reliability of the financial data and reports. Regression testing can help identify and resolve any issues before they affect the users and the business processes.

Unit testing, network performance, and user acceptance testing (UAT) are also important aspects of the project, but they are not the primary focus of the IS auditor in the first year. Unit testing is a type of testing that verifies that each individual module or component of the system works as expected.Network performance is a measure of how well the system can communicate and exchange data with other systems and devices over a network. User acceptance testing (UAT) is a type of testing that validates that the system meets the user requirements and expectations. These aspects are more relevant in later stages of the project, when the system is more developed and ready for deployment.

References:

ERP Upgrade: The Path to Modernization | SAP

ERP System Validation: Your Guide To Successfully Validating ERP Systems

The role of internal auditors in ERP‐based organizations

What is Regression Testing? Definition, Tools & Examples

What is Unit Testing? Definition, Tools & Examples

What is Network Performance? Definition, Metrics & Examples

What is User Acceptance Testing (UAT)? Definition, Process & Examples

 The IS auditor’s best course of action when reviewing the use of an outsourcer for disposal of storage media is to determine exposure to the business. Storage media, such as hard disks, tapes, flash drives, or CDs, may contain sensitive or confidential information that needs to be protected from unauthorized access, disclosure, or misuse. The IS auditor should verify that the outsourcer has a process that appropriately sanitizes the media before disposal, such as wiping, degaussing, shredding, or incinerating, and that the process is effective and compliant with the organization’s policies and standards. The IS auditor should also assess the potential impact and risk to the business if the storage media is not properly sanitized or disposed of, such as data breaches, reputational damage, legal or regulatory penalties, or loss of competitive advantage. The other options are not the best course of action, because they either do not address the root cause of the problem,or they are reactive rather than proactive measures. References: CISA Review Manual (Digital Version)1, Chapter 5, Section 5.2.7

 Backup procedures for an organization’s critical data are considered to be corrective controls, as they are designed to restore normal operations after a disruption or failure. Corrective controls aim to minimize the impact of an incident and prevent recurrence. Directive, detective and compensating controls are not related to backup procedures. Directive controls are intended to guide or instruct users to follow policies and procedures. Detective controls are intended to identify and report incidents or violations. Compensating controls are intended to mitigate the risk of a missing or ineffective primary control. References: CISA Review Manual (Digital Version), Chapter 2, Section 2.11

Segregation of duties is a key internal control that aims to prevent fraud and errors by ensuring that no single individual has the authority to execute two or more conflicting sensitive transactions orfunctions. In the accounts payable vendor payment cycle, segregation of duties involves separating the tasks of vendor setup, procurement, invoice approval, and payment processing1. This way, an employee cannot create a fictitious vendor and issue a payment to themselves or their accomplices without being detected by another person. Therefore, the best way to prevent fraudulent payments is to implement segregation of duties between the vendorsetup and payment processing. References: 1: Segregation of Duties in the Accounts Payable Vendor Payment Cycle for SMBs - Now With a Podcast! - Debra R Richardson : What is Separation of duties - University of California, Berkeley

The primary benefit of automating application testing is to provide test consistency. Automated testing can ensure that the same test cases are executed in the same manner and order every time, which can improve the reliability and accuracy of the test results. Providing more flexibility, replacing all manual test processes, and reducing the time to review code are possible benefits of automating application testing, but they are not the primary benefit. References:

ISACA, CISA Review Manual, 27th Edition, 2020, p. 3091

ISACA, CISA Review Questions, Answers & Explanations Database - 12 Month Subscription

Recovery facilities providing a redundant combination of Internet connections to the local communications loop is an example of last-mile circuit protection. Last-mile circuit protection is a type of telecommunications continuity that ensures the availability and redundancy of the final segment of the network that connects the end-user to the service provider. The local communications loop, also known as the local loop or subscriber line, is the physical link between the customer premises and the nearest central office or point of presence of the service provider. Byhavingmultiple Internet connections from different providers or technologies, such as cable, DSL, fiber, wireless, or satellite, the recoveryfacilities can avoid losing connectivity in case one of the connections fails or is disrupted by a disaster5.

References:

9: Last Mile Redundancy - How to Ensure Business Continuity - Multapplied Networks

 Social engineering is the manipulation of people to perform actions or divulge confidential information. It is a common technique used by attackers to gain unauthorized access to systems or data. Employees who use public social networking sites may be vulnerable to social engineering attacks, such as phishing, baiting, or pretexting, which pose the greatest risk to the organization’s security. The other options are not as serious as social engineering, as they relate to web application vulnerabilities, intellectual property rights, and reputation management, which are less likely to compromise the organization’s assets or operations. References: CISA Review Manual (Digital Version), Domain 5: Protection of Information Assets, Section 5.3 Security Awareness Training1

 An IT balanced scorecard is primarily used for measuring IT strategic performance. An IT balanced scorecard is a framework that translates the IT strategy into measurable objectives, indicators, targets, and initiatives across four perspectives: financial, customer, internal process, and learning and growth. An IT balanced scorecard helps to monitor and evaluate how well the IT function is delivering value to the organization, achieving its strategic goals, and improving its capabilities and competencies. The otheroptions are not the primary uses of an IT balanced scorecard, because they either focus on specific aspects of IT rather than the overall performance, or they are not directly related to the IT strategy. References: CISA Review Manual (Digital Version)1, Chapter 1, Section 1.2.3

 A configuration management system is a process that establishes and maintains the consistency of a product’s attributes throughout its life cycle. It helps to identify and control the functional and physical characteristics of a product, and to record and report any changes to those characteristics. A configuration management system also supports the audit of the product to verify its conformance to requirements.

One of the key activities of a configuration management system is to define baselines for software. A baseline is a fixed reference point that serves as a basis for comparison and measurement. A baseline can be established for any configuration item, such as a requirement, a design document, a test plan, or a software component. A baseline helps to ensure that the software product meets its intended purpose and quality standards, and that any changes to the software are controlled and documented.

A configuration management system also supports other activities, such as tracking software updates, supporting the release procedure, and standardizing change approval, but these are not its primary purpose. Therefore, the other options are incorrect.

References: : What is configuration management - Red Hat : Configuration Management | Definition, Importance & Benefits - ServerWatch

The answer A is correct because the greatest concern for an IS auditor when a data owner assigns an incorrect classification level to data is that controls to adequately safeguard the data may not be applied. Data classification is the process of categorizing data assets based on their information sensitivity and business impact. Data classification helps organizations to identify, protect, and manage their data according to their value and risk. Data owners are the individuals or entities who have the authority and responsibility to define, classify, and control the access and use of their data.

Data classification typically involves assigning labels or tags to data assets, such as public, internal, confidential, or restricted. These labels indicate the level of protection and handling required for the data. Based on the data classification, organizations can implement appropriate controls to safeguard the data, such as encryption, access control lists, audit logs, backup policies, etc. These controls help to prevent unauthorized access, disclosure, modification, or loss of data, and to ensure compliance with relevant laws and regulations.

If a data owner assigns an incorrect classification level to data, it can result in either underprotection or overprotection of the data. Underprotection means that the data is classified at a lower level than it should be, which exposes it to higher risks of compromise or breach. For example, if a data owner classifies personal health information (PHI) as public instead of confidential, it may allow anyone to access or share the data without proper authorization or consent. This can violate the privacy rights ofthe data subjects and the compliance requirements of regulations such as HIPAA (Health Insurance Portability and Accountability Act). Overprotection means that the data is classified at a higher level than it should be, which limits its availability or usability. For example, if a data owner classifies marketing materials as restricted instead of public, it may prevent potential customers or partners from accessing or viewing the data. This can reduce the business value and opportunities of the data.

Therefore, an IS auditor should be concerned about the accuracy and consistency of data classification by data owners, as it affects the security and efficiency of data management. An IS auditor should review the policies and procedures for data classification, verify that the data owners have adequate knowledge and skills to classify their data, and test that the data classification labels match with the actual sensitivity and impact of the data.

References:

Data Classification: What It Is and How to Implement It

What Is Data Classification? - Definition, Levels & Examples …

Data Classification: A Guide for Data Security Leaders

 The most important thing to assess when conducting a business impact analysis (BIA) is the completeness of critical asset inventory. This is because the critical asset inventory is the basis for identifying and prioritizing the business processes, functions, and resources that are essential for thecontinuity of operations. The critical asset inventory should include both tangible and intangible assets, such as hardware, software, data, personnel, facilities, contracts, and reputation. The critical asset inventory should also be updated regularly to reflect any changes in the business environment or needs. References:

CISA Review Manual (Digital Version), Chapter 5, Section 5.41

CISA Online Review Course, Domain 3, Module 3, Lesson 12

An IT framework for alignment between IT and business objectives is a set of principles, guidelines, and practices that help an organization to ensure that its IT investments support its strategic goals, deliver value, manage risks, and optimize resources. One of the benefits of implementing such a framework is that it enables an effective IT portfolio management, which is the process of selecting, prioritizing, monitoring, and evaluating the IT projects and services that comprise the IT portfolio. An IT portfolio is a collection of IT assets, such as applications, infrastructure, data, and capabilities, that are aligned with the business needs and objectives. An IT portfolio management helps an organization to achieve the following outcomes:

Align the IT portfolio with the business strategy and vision

Balance the IT portfolio among different types of investments, such as innovation, growth, maintenance, and compliance

Optimize the IT portfolio performance, value, and risk

Enhance the IT portfolio decision-making and governance

Improve the IT portfolio communication and transparency

Therefore, an inadequate IT portfolio management is a major concern that can be addressed by implementing an IT framework for alignment between IT and business objectives. An inadequate IT portfolio management can result in the following issues:

Misalignment of the IT portfolio with the business needs and expectations

Imbalance of the IT portfolio among competing demands and priorities

Suboptimal use of the IT resources and capabilities

Lack of visibility and accountability of the IT portfolio outcomes and impacts

Poor communication and collaboration among the IT portfolio stakeholders

The other possible options are:

Inaccurate business impact analysis (BIA): A BIA is a process of identifying and assessing the potential effects of a disruption or disaster on the critical business functions and processes. A BIA helps an organization to determine the recovery priorities, objectives, and strategies for its business continuity plan. A BIA is not directly related to an IT framework for alignment between IT and business objectives, although it may use some inputs from the IT portfolio management. Therefore, an inaccurate BIA is not a concern that can be effectively addressed by implementing an IT framework for alignment between IT and business objectives.

Inadequate IT change management practices: IT change management is a process of controlling and managing the changes to the IT environment, such as hardware, software, configuration, or documentation. IT change management helps an organization to minimize the risks and disruptions caused by the changes, ensure the quality and consistency of the changes, and align the changes with the business requirements. IT change management is not directly related to an IT framework for alignment between IT and business objectives, although it may support some aspects of the IT portfolio management. Therefore, inadequate IT change management practicesare not a concern that can be effectively addressed by implementing an IT framework for alignment between IT and business objectives.

Lack of a benchmark analysis: A benchmark analysis is a process of comparing an organization’s performance, processes, or practices with those of other organizations or industry standards. A benchmark analysis helps an organization to identify its strengths and weaknesses, set realistic goals and targets, and implement best practices for improvement. A benchmark analysis is not directly related to an IT framework for alignment between IT and business objectives, although it may provide some insights for the IT portfolio management. Therefore, lack of a benchmark analysis is not a concern that can be effectively addressed by implementing an IT framework for alignment between IT and business objectives. References: 1: What is Portfolio Management? | Smartsheet 2: What Is Portfolio Management? - Definition from Techopedia 3: What Is Project Portfolio Management (PPM)? |ProjectManager.com 4: What Is Business Impact Analysis? | Smartsheet 5: What Is Change Management? - Definition from Techopedia 6: Benchmarking - Wikipedia

The primary reason for an IS audit manager to review the work performed by a senior IS auditor prior to presentation of a report is to ensure the conclusions are adequately supported. The IS audit manager is responsible for overseeing and supervising the audit process, ensuring the quality and consistency of the audit work, and approving the audit report and recommendations. The IS audit manager should review the work performed by the senior IS auditor to verify that the audit objectives, scope, and criteria have been met, that the audit evidence is sufficient, reliable, and relevant, and that the audit conclusions are logical, objective, and based on the audit evidence. The IS audit manager should also ensure that the audit report is clear, concise, accurate, and complete, and that it communicates the auditfindings, conclusions, and recommendations effectively to the intended audience. The other options are not the primary reason for an IS audit manager to reviewthe work performed by a seniorIS auditor prior to presentation of a report, because they either relate to specific aspects or stages of the audit work rather than the overall outcome, or they are part of the senior IS auditor’s responsibility rather thanthe IS audit manager’s. References: CISA Review Manual (Digital Version)1, Chapter 2, Section 2.2.5

 The best way to ensure that a proper cutoff has been established to reinstate transactions and records to their condition just prior to a computer system failure is to use a database management system (DBMS) to dynamically back-out partially processed transactions. A DBMS is a software system that manages the creation, manipulation, retrieval, and security of data stored in a database. A DBMS can provide features such as transaction management, concurrency control, recovery management, and integrity management. A DBMS can dynamically back-out partially processed transactions by using mechanisms such as rollback segments, undo logs, or write-ahead logs. These mechanisms allow the DBMS to restore the database to a consistent state before the failure occurred. References:

CISA Review Manual (Digital Version)

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The best control to minimize the risk of unauthorized access to lost company-owned mobile devices is device encryption. Device encryption is a process that transforms data on a device into an unreadable format using a cryptographic key. Device encryption protects the data stored on the device from being accessed by unauthorized parties, even if they bypass the password or PIN protection. Device encryption can also prevent data leakage if the device is disposed of or recycled without proper data sanitization. Password or PIN protection is a basic control that prevents unauthorized access to the device by requiring a secret code or pattern to unlock it. However, password or PIN protection can be easily compromised by brute force attacks, shoulder surfing, or social engineering. Device trackingsoftware is a tool that allows the device owner or administrator to locate, lock, or wipe the device remotely in case of loss or theft. However, device tracking software depends on the device’s network connectivity and GPS functionality, which may not be available or reliable in some situations. Periodic backup is a process that copies the data from the device to another storage location for recovery purposes. Periodic backup can help restore the data in case of loss or damage of the device, but it does not prevent unauthorized access to the data on the device itself. References: CISA ReviewManual (Digital Version), Chapter 5: Protection of Information Assets, Section 5.4: Mobile Devices

 The first step when developing a data loss prevention (DLP) solution for a large organization is to conduct a data inventory and classification exercise. This step is essential to identify the types, locations, owners, and sensitivity levels of the data that need to be protected by the DLP solution. A data inventory and classification exercise helps to define the scope, objectives, and requirements of the DLP solution, as well as to prioritize the data protection efforts based on the business value and risk of the data. A data inventory and classification exercise also enables the organization to comply with relevant laws and regulations regarding data privacy and security.

The other options are not the first step when developing a DLP solution, but rather subsequent steps that depend on the outcome of the data inventory and classification exercise. Identifying approved data workflows across the enterprise is a step that helps to design and implement the DLP policies and controls that match the business processes and data flows. Conducting a threat analysis against sensitive data usage is a step that helps to assess and mitigate the risks associated with data leakage, theft, or misuse. Creating the DLP policies and templates is a step that helps to enforce the data protection rules and standards across the organization.

References:

ISACA CISA Review Manual 27th Edition (2019), page 247

Data Loss Prevention—Next Steps - ISACA1

What is data loss prevention (DLP)? | Microsoft Security

 The most critical finding that the IS auditor should consider when reviewing processes for importing market price data from external data providers is that the quality of the data is not monitored. This is because market price data is essential for financial transactions, risk management, valuation and reporting, and any errors or inaccuracies in the data can have significant impact on the organization’s performance, reputation and compliance. The IS auditor should ensure that the organization has established quality criteria and controls for the imported data, such as validity, completeness,timeliness, consistency and accuracy, and that the data is regularly checked and verified against these criteria. The other findings are also important, but not as critical as data quality. References: CISA Review Manual (Digital Version)1, Chapter 5, Section 5.2.7

The best approach to optimize resources when both internal and external audit teams are reviewing the same IT general controls area is to leverage the work performed by external audit for the internal audit testing. This can avoid duplication of efforts, reduce audit costs and enhance coordination between the audit teams. The internal audit team should evaluate the quality and reliability of the external audit work before relying on it. Ensuring both the internal and external auditors perform the worksimultaneously is not an efficient use of resources, as it would create redundancy and possible interference. Requesting that the external audit team leverage the internal audit work may not be feasible or acceptable, as the external audit team may have different objectives, standards and independence requirements. Rolling forward the general controls audit to the subsequent audit year is not a good practice, as it would delay the identification and remediation of any control weaknesses in a high-risk area. References: ISACA, CISA Review Manual, 27th Edition, 2018, page 247

 Digital watermarks are hidden marks or codes that can be embedded into digital files, such as images, videos, audio, or documents. They can be used to identify the source, owner, or authorized user of the data, as well as to track any unauthorized copying or distribution of the data. Digital watermarks can help prevent data leakage by deterring potential leakers from sharing sensitive data or by providing evidence of data leakage if it occurs.

The other options are not as effective as digital watermarks in preventing data leakage. Ensuring that paper documents are disposed securely can reduce the risk of physical data leakage, but it does not address the digital data leakage that is more prevalent in today’s environment. Implementing an intrusion detection system (IDS) can help detect and respond to cyberattacks that may cause data leakage, but it does not prevent data leakage from insiders or authorized users who have legitimate access to the data. Verifying that application logs capture any changes made can help audit and investigate data leakage incidents, but it does not prevent them from happening in the first place.

References:

What is Data Leakage?

What is Digital Watermarking?

 The type of risk associated with the potential for the auditor to miss a sequence of logged events that could indicate an error in the IPS configuration is detection risk. Detection risk is the risk that the auditor’s procedures will not detect a material misstatement or error that exists in an assertion or a control. Detection risk can be affected by factors such as the nature, timing, and extent of the audit procedures, the quality and sufficiency of the audit evidence, and the auditor’s professional judgment and competence. Detection risk can be reduced by applying appropriate audit techniques, such as sampling, testing, observation, inquiry, and analysis. References:

CISA Review Manual (Digital Version)

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The best way to validate that appropriate security controls are in place to prevent data loss is to review compliance with data loss and applicable mobile device user acceptance policies. This will ensure that the organization has established clear rules and guidelines for employees to follow when connecting their personal devices to company-owned computers. A walk-through, a DLP tool configuration, and a security awareness training are not sufficient to validate the effectiveness of the controls, as they may not cover all possible scenarios and risks. References: IT Audit Fundamentals Certificate Resources

When verifying the accuracy and completeness of migrated data for a new application system replacing a legacy system, it is most effective for an IS auditor to review data analytics findings. Data analytics is a technique that uses software tools and statistical methods to analyze large volumes of data and identify patterns, anomalies, errors or inconsistencies. Data analytics can help to compare the source and target data sets, validate the data quality and integrity, and detect any data loss or corruption during the migration process. The other options are not as effective, because audit trails only record the actions performed on the data, acceptance testingresults only verify the functionality of the new system, and rollback plans only provide contingency measures in case of migration failure. References: CISA Review Manual (Digital Version)1, Chapter 5, Section 5.2.6

The most significant risk from this observation is that access rights may not be removed in a timely manner. If the process for removing access for terminated employees is not documented, there is no clear guidance or accountability for who, how, when, and what actions should be taken to revoke the access rights of the employees who leave the organization. This could result in delays, inconsistencies, or omissions in removing access rights, which could allow terminated employees to retain unauthorized access to the organization’s systems and data. This could compromise the security, confidentiality, integrity, and availability of the information assets. References:

CISA Review Manual (Digital Version)

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The best recommendation by the IS auditor for finding that application servers had inconsistent security settings leading to potential vulnerabilities is to perform a configuration review. A configuration review is an audit procedure that involves examining and verifying the security settings and parameters of application servers against predefined standards or best practices. A configuration review can help to identify and remediate any deviations, inconsistencies, or misconfigurations thatmay expose the application servers to unauthorized access, exploitation, or compromise6. A configuration review can also help to ensure compliance with security policies and regulations, as well as enhance the performance and availability of application servers. The other options are less effective or incorrect because:

A. Improving the change management process is not the best recommendation by the IS auditor for finding that application servers had inconsistent security settings leading to potential vulnerabilities, as it does not address the root cause of the problem or provide a specific solution. While improving the change management process may help to prevent future inconsistencies or misconfigurations in application server settings, it does not ensure that the existing ones are detected and corrected.

B. Establishing security metrics is not the best recommendation by the IS auditor for finding that application servers had inconsistent security settings leading to potential vulnerabilities, as it does not address the root cause of the problem or provide a specific solution. While establishing security metrics may help to measure and monitor the security performance andposture of application servers, it does not ensure that the existing inconsistencies or misconfigurations in application server settings are detected and corrected.

C. Performing a penetration test is not the best recommendation by the IS auditor for finding that application servers had inconsistent security settings leading to potential vulnerabilities, as it does not address the root cause of the problem or provide a specific solution. While performing a penetration test may help to simulate and evaluate the impact of an attack on application servers, it does not ensure that the existing inconsistencies or misconfigurations in application server settings are detected and corrected. References: Configuring system to useapplication server security - IBM, Application Security Risk: Assessment and Modeling - ISACA, Five Key Components of an Application SecurityProgram - ISACA, ISACA Practitioner Guidelines for Auditors - SSH, SCADA Cybersecurity Framework - ISACA

 The first step in the incident response process for a suspected breach is to research the validity of the alerted breach. An incident response process is a set of procedures that defines how to handle securityincidents in a timely and effective manner. The first step in this process is to research the validity of the alerted breach, which means to verify whether the alert is genuine or false positive, to determine the scope and impact of the incident, and to gather relevant information for further analysis and action. Informing potentially affected customers of the security breach, notifying business management of the security breach, and engaging a third party to independently evaluate the alerted breach are also steps in the incident response process, but they are not the first step. References:

CISA Review Manual, 27th Edition, page 4251

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The best way to enable the effectiveness of an agile project for the rapid development of a new software application is to separate the work into sprints. Sprints are short, time-boxed iterations that deliver a potentially releasable product increment at the end of each sprint. Sprints allow agile teams to work in a flexible and adaptive manner, respond quickly to changing customer needs and feedback, and deliver value faster and more frequently. Sprints also help teams to plan, execute, review, and improve their work in a collaborative and transparent way. Project segments, phases, and milestones are not specific to agile projects and do not necessarily enable the effectiveness of an agileproject. References: Agile Project Management [Whatis it & How to Start] - Atlassian, CISA Review Manual (Digital Version).

Segregation of duties (SoD) is a key internal control that aims to prevent fraud and errors by ensuring that no single individual can perform incompatible or conflicting tasks within a business process. SoD reduces the risk of unauthorized or improper transactions, manipulation of data, or misappropriation of assets.

In the accounts payable department, SoD involves separating the following functions: invoice processing, payment authorization, payment execution, and reconciliation. For example, the person who approves an invoice should not be the same person who issues the payment or reconciles the bank statement.

One of the best ways to ensure appropriate SoD within the accounts payable department is to restrict program functionality according to user security profiles. This means that each user of the accounts payable system should have a unique login and password, and should only have access to the functions that are relevant to their role and responsibilities. For instance, an invoice processor should not be able to approve payments or modify vendor records. This way, the system can enforce SoD and prevent unauthorized or fraudulent activities.

The other options are not as effective as restricting program functionality according to user security profiles. Restricting access to update programs to accounts payable staff only is a general access control measure, but it does not address the SoD issue within the accounts payable department. Including the creator’s user ID as a field in every transaction record created is a useful audit trail feature, but it does not prevent users from performing incompatible functions. Ensuring that audit trails exist for transactions is a detective control that can help identify and investigate any irregularities, but it does not prevent them from occurring in the first place.

The IS auditor should notify audit management of the finding first, as this is a significant issue that may affect the audit scope and objectives. The IS auditor should not notify law enforcement or require the third party to notify customers without consulting audit management first. The audit report with a significant finding should be issued after the audit is completed and the findings are validated. References: ISACA, CISA Review Manual, 27th Edition, 2018, page 247

The most appropriate control to prevent unauthorized retrieval of confidential information stored in a business application system is to enforce an internal data access policy. A data access policy defines who can access what data, under what conditions and for what purposes. It also specifies the roles and responsibilities of data owners, custodians and users, as well as the security measures and controls to protect data confidentiality, integrity and availability. By enforcing a data access policy, the organization can ensure that only authorized personnel can retrieve confidential informationfrom the business application system. Applying single sign-on for access control, implementing segregation of duties and enforcing the use of digital signatures are also useful controls, but they are not sufficient to prevent unauthorized data retrieval without a clear and comprehensive data access policy. References:

CISA Review Manual, 27th Edition, page 2301

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 The most critical finding for an IS auditor following up on a recent security incident is that the security weakness facilitating the attack was not identified. This finding indicates that the root cause of the incident was not analyzed, and the vulnerability that allowed the attack to succeed was not remediated. This means that the organization is still exposed to the same or similar attacks in the future, and its security posture has not improved. Identifying and addressing the security weakness is a key step in the incident response process, as it helps to prevent recurrence, mitigate impact, and improve resilience.

The other findings are not as critical as the failure to identify the security weakness, but they are still important issues that should be addressed by the organization. The attack was not automatically blocked by the intrusion detection system (IDS) is a finding that suggests that the IDS was not configured properly, or that it did not have the latest signatures or rules to detect and prevent the attack. The attack could not be traced back to the originating person is a finding that implies that the organization did not have sufficient logging, monitoring, or forensic capabilities to identify and attribute the attacker. Appropriate response documentation was not maintained is a finding that indicates that the organization did not follow a consistent and formal incident response procedure, or that it did not document its actions, decisions, and lessons learned from the incident.

References:

ISACA CISA Review Manual 27th Edition (2019), page 254

Incident Response Process - ISACA1

Incident Response: How to Identify and Fix Security Weaknesses

 An IS auditor should be concerned because deleting the files logically does not overwrite the files’ physical data. Deleting a file from a hard disk only removes the reference or pointer to the file from the file system, but does not erase the actual data stored on the disk sectors. The deleted data can still be recovered using special tools or techniques until it is overwritten by new data. This poses a risk of data leakage, theft, or misuse if the hard disk falls into the wrong hands. To securely dispose of a system containing sensitive data, the hard disk should be wiped or sanitized using methods that overwrite or destroy the physical data beyond recovery. References:

CISA Review Manual (Digital Version)

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 The greatest challenge to the alignment of business and IT is the lack of chief information officer (CIO) involvement in board meetings. The CIO is the senior executive responsible for overseeing the IT strategy, governance, and operations of the organization, and ensuring that they support the business objectives and needs. The CIO should be involved in board meetings to communicate the value and contribution of IT to the organization, to align the IT vision and direction with the business strategy and priorities, and to advocate for the IT resources and investments required to achieve the desired outcomes. The lack of CIO involvement in board meetings can result in a disconnect between business and IT, a loss of trust and confidence in IT, and missed opportunities for innovation and value creation. The other options are not as challenging as the lack of CIO involvement in board meetings, because they either do not affect the strategic alignment of business and IT, or theycanbe addressed by other means such as collaboration, negotiation, or escalation. References: CISA Review Manual (Digital Version)1, Chapter 1, Section 1.2.1

The best description of an audit risk is that the financial report may contain undetected material errors. Audit risk is the risk that the auditor expresses an inappropriate opinion on the financial report when it contains material misstatements or errors. Audit risk consists of three components: inherentrisk, control risk, and detection risk. Inherent risk is the susceptibility of an assertion or a control to a material misstatement or error due to factors such as complexity, volatility, fraud, or human error. Control risk is the risk that a material misstatement or error will not be prevented or detected by the internal controls. Detection risk is the risk that the auditor’s procedures will not detect a material misstatement or error that exists in an assertion or a control. References:

CISA Review Manual (Digital Version)

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The best way to enforce the principle of least privilege on a server containing data with different security classifications is to apply access controls determined by the data owner. The principle of least privilege states that users should only have the minimum level of access required to perform their tasks. The data owner is the person who has the authority and responsibility to classify, label, and protect the data according to its sensitivity and value. The data owner can define the access rightsand permissions for each user or role based on the data classification policy and the business needs. This will ensure that only authorized and appropriate users can access the data and prevent unauthorized or excessive access that could compromise the confidentiality, integrity, or availability of the data. References:

CISA Review Manual (Digital Version)

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The mitigating factor that would most significantly minimize the impact of not renewing IT risk acceptances in a timely manner is having documented compensating controls over the business processes. Compensating controls are alternative controls that reduce or eliminate the risk when the primary control is not feasible or cost-effective. The other factors, such as previous approval by senior management, unchanged business environment, and small percentage of issues, do not mitigate the risk as effectively as compensating controls. References: ISACA CISA Review Manual 27th Edition Chapter 1

The approach adopted by management in this scenario is risk avoidance. Risk avoidance is the elimination of a risk by discontinuing or not undertaking an activity that poses a threat to the organization3. By moving data center operations to another facility on higher ground, management is avoiding the potential flooding risk that could disrupt or damage the data center. Risk transfer, risk acceptance and risk reduction are other possible approaches for dealing with risks, but they do not apply in this case. References:

CISA Review Manual, 27th Edition, page 641

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The best recommendation for improving IT governance within the organization is to implement key performance indicators (KPIs). KPIs are measurable values that show how effectively the organization is achieving its key business objectives. KPIs can help the organization tomonitor and evaluate the performance, efficiency, and alignment of its IT processes and resources with its business goals and strategies1.

The other options are not as effective as implementing KPIs for improving IT governance. Option B, implementing annual third-party audits, is a good practice but may not be sufficient or timely to identify and address the issues or gaps in IT governance. Option C, benchmarking organizational performance against industry peers, is a useful technique but may not reflect the specific needs and expectations of the organization’s stakeholders. Option D, requiring executive management to draft IT strategy, is a necessary step but not enough to ensure that IT governance is implemented and monitored throughout the organization.

The best evidence that an organization’s IT strategy is aligned to its business objectives is that the IT strategy is approved by executive management. This implies that the IT strategy has been reviewed and validated by the senior leaders of the organization, who are responsible for setting and overseeing the business objectives. The IT strategy may be modified inresponse to organizational change, based on IT operational best practices, or have significant impact on the business strategy, but these are not sufficient indicators of alignment without executive approval. References: CISA Review Manual (Digital Version)1, Chapter 1, Section 1.2.1

The most helpful tool in matching demand for projects and services with available resources in a way that supports business objectives is portfolio management. Portfolio management is the process of selecting, prioritizing, balancing and aligning IT projects and services with the strategic goals and value proposition of the organization3. Portfolio management helps the IT organization to allocate resources efficiently and effectively, to deliver value to the business units, and to align IT initiatives with business strategies. Project management, risk assessment results and IT governance framework are also important tools, but they are not as helpful as portfolio management in matching demand and supply of IT projects and services. References:

CISA Review Manual, 27th Edition, page 721

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The major concern with the situation where security incidents are resolved and closed, but root causes are not investigated, is that vulnerabilities have not been properly addressed. Vulnerabilities are weaknesses or gaps in the security posture of an organization that can be exploited by threat actors to compromise its systems, data, or operations. If root causes are not investigated, vulnerabilities may remain undetected or unresolved, allowing attackers to exploit them again or use them asentry points for further attacks. This can result in repeated or escalated security incidents that can cause more damage or disruption to the organization.

The other options are not as major as the concern about vulnerabilities, but rather secondary or related issues that may arise from the lack of root cause analysis. Abuses by employees have not been reported is a concern that may indicate a lack of awareness, accountability, or monitoring of insider threats. Lessons learned have not been properly documented is a concern that may indicate a lack of improvement, learning, or feedback from security incidents. Security incident policies are out of date is a concern that may indicate a lack of alignment, review, or update of security incident processes.

References:

ISACA CISA Review Manual 27th Edition (2019), page 254

Why Root Cause Analysis is Crucial to Incident Response (IR) - Avertium3

Root Cause Analysis Steps and How it Helps Incident Response …

The best way to evaluate the effectiveness of a new automated control is to review the written procedures that define the processes and controls. This will help the IS auditor to understand the objectives, scope, roles, responsibilities, and expected outcomes of the control. The written procedures will also provide a basis for testing the control and verifying its compliance with the audit finding recommendations. References:

ISACA Frameworks: Blueprints for Success

CISA Review Manual (Digital Version)

 The IS auditor should ensure that penetration test results are classified at the highest level of sensitivity, because they contain detailed information about the vulnerabilities and weaknesses of the IT systems and networks, as well as the methods and tools used by the testers to exploit them. Penetration test results can be used by malicious actors to launch cyberattacks or cause damage to the organization if they are disclosed or accessed without authorization. Therefore, they should be protected with the highest level of confidentiality, integrity and availability. The other options are not as sensitive as penetration test results, because they either do not reveal as muchinformation aboutthe IT security posture, or they are already known or reported by the organization. References: CISA Review Manual (Digital Version)1, Chapter 5, Section 5.2.4

Water sensors are devices that can detect the presence of water or moisture in a given area. They are often deployed below the floor tiles of a data center to monitor for any water leaks that may damage the equipment or cause electrical hazards. Water sensors can alert the data center staff or trigger an automatic response to prevent or mitigate the water leakage.

The other options are not likely to be deployed below the floor tiles of a data center. Temperature sensors and humidity sensors are usually deployed above the floor tiles to measure the ambient conditions of the data center and ensure optimal cooling and ventilation. Air pressure sensors are typically deployed at the air vents or ducts to monitor the airflow and pressure distribution in the data center.

References:

Data Center Environmental Monitoring

Water Detection in Data Centers

 A differential backup scheme is the best option when storage media is limited, as it only backs up the data that has changed since the last full backup. This reduces the amount of storage space required and also simplifies the restoration process, as only the last full backup and the last differential backup are needed. A real-time backup scheme would require continuous replication of data, which would consume a lot of storage space and network bandwidth. A virtual backup scheme would create a snapshot of the data at a point in time, but it would not reduce the storage space required, as it would still need to store the changes made to the data. A full backup scheme would back up all the data every time, which would require the most storage space and also take longer to complete. References: ISACA, CISA Review Manual, 27th Edition, 2018, page 405

 The best evidence that adequate resources are now allocated to successfully recover the systems is a service level agreement (SLA). An SLA is a contract between a service provider and a customer that defines the scope, quality, and terms of the service delivery. An SLA should include measurable and verifiable indicators of the service performance, such as availability, reliability, capacity, security, and recovery. An SLA should also specify the roles, responsibilities, and expectations of both parties, as well as the remedies and penalties for non-compliance. An SLA can help to ensure that the third-party vendor has allocated sufficient hardware and other resources to meet the recovery objectives and requirements of the organization. References:

CISA Review Manual (Digital Version)

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The greatest concern that the IS auditor should have when reviewing an organization’s security information and event management (SIEM) solution is that the SIEM is decentralized. This is because a decentralized SIEM can pose challenges for collecting, correlating, analyzing and reporting on security events and incidents from multiple sources and locations. A decentralized SIEM can also increase the complexity and cost of maintaining and updating the SIEM components, as well as the risk of inconsistent or incomplete security monitoring and response. The IS auditor should recommend that the organization adopts a centralized or hybrid SIEM architecture that can provide a holistic and integrated view of the security posture and activities across the organization. The other findings are not as concerning as a decentralized SIEM, because they can be addressedby implementing best practices and standards for SIEM reporting and configuration. References: CISA Review Manual (Digital Version)1, Chapter 5, Section 5.2.4

The greatest concern for an IS auditor reviewing a network printer disposal process is that evidence is not available to verify printer hard drives have been sanitized prior to disposal. This can expose sensitive data to unauthorized parties and cause data breaches. Disposal policies and procedures not being consistently implemented or business units being allowed to dispose printers directly to vendors are compliance issues, but not as critical as data protection. Inoperable printers being stored in an unsecured area is a physical security issue, but not as severe as data leakage. References: ISACA, CISA Review Manual, 27th Edition, 2018, page 387

An appropriate role of internal audit in helping to establish an organization’s privacy program is analyzing risks posed by new regulations. A privacy program is a set of policies, procedures, and controls that aim to protect the personal data of individuals from unauthorized or unlawful collection, use, disclosure, or disposal. A privacy program should comply with the applicable laws and regulations that govern the privacy rights and obligations of individuals and organizations, such as the General Data Protection Regulation (GDPR) or the California Consumer Privacy Act (CCPA). New regulations may introduce new requirements or changes that affect the organization’s privacy program and expose it to potential compliance risks or penalties. Therefore, internal audit can help to establish an organization’s privacy program by analyzing the risks posed by new regulations and providingassurance, advice, or recommendations on how to address them1. The other options are less appropriate or incorrect because:

B. Developing procedures to monitor the use of personal data is not an appropriate role of internal audit in helping to establish an organization’s privacy program, as it is more of a management or operational role. Internal audit should not be involved in designing or implementing the organization’s privacy program, as it would compromise its independence and objectivity. Internal audit should provide assurance on the effectiveness and efficiency of the organization’s privacy program, but not create or execute it2.

C. Defining roles within the organization related to privacy is not an appropriate role of internal audit in helping to establish an organization’s privacy program, as it is more of a governance or strategic role. Internal audit should not be involved in setting or approving the organization’s privacy strategy, objectives, or policies, as it would compromise its independence and objectivity. Internal audit should provide assurance on the alignment and compliance ofthe organization’s privacy program with its strategy, objectives, and policies, but not define or approve them2.

D. Designing controls to protect personal data is not an appropriate role of internal audit in helping to establish an organization’s privacy program, as it is more of a management or operational role. Internal audit should not be involved in designing or implementing the organization’s privacy program, as it would compromise its independence and objectivity. Internal audit should provide assurance on the adequacy and effectiveness of the organization’s privacy program, but not design or implement it2. References: ISACA Introduces New Audit Programs for Business Continuity/Disaster …, Best Practices for Privacy Audits - ISACA, ISACA Produces New Audit and Assurance Programs for Data Privacy and …

 The most efficient way to identify segregation of duties violations in a new system is to review a report of security rights in the system. Segregation of duties is a control principle that aims to prevent or detect errors, fraud, or abuse by ensuring that no single individual has the ability to perform incompatible or conflicting functions or activities within a system or process. A report of security rights in the system can provide a comprehensive and accurate overview of the roles, responsibilities, and access levels assigned to different users or groups in the system, and can help to identify any potential segregation of duties violations or risks. The other options are not as efficient as reviewing a report of security rights in the system, because they either rely on observation or testing rather than analysis, or they focus on existing rather than potential violations. References: CISA Review Manual (Digital Version)1, Chapter 5, Section 5.2.2

The best reason to implement a data retention policy is to limit the liability associated with storing and protecting information. A data retention policy is a document that defines how long data should be kept by an organization and how they should be disposed of when they are no longer needed. A data retention policy should comply with the applicable laws and regulations that govern the data retention requirements and obligations of organizations, such as tax laws, privacy laws, or industry standards4. Implementing a data retention policy can help to limit the liability associated with storing and protecting information by reducing the amount of data that need to be stored and secured, minimizing the risk of data breaches or leaks, ensuringcompliance with legal or contractual obligations, and avoiding potential fines or penalties for non-compliance5. The other options are less relevant or incorrect because:

B. Documenting business objectives for processing data within the organization is not a reason to implement a data retention policy, as it is more related to data governance than data retention. Data governance refers to the policies, procedures, and controls that define how data are collected, used, managed, and shared within an organization. Data governance helps to ensure that data are aligned with business objectives and support decision making6.

C. Assigning responsibility and ownership for data protection outside IT is not a reason to implement a data retention policy, as it is more related to data accountability than data retention. Data accountability refers to the identification and assignment of roles and responsibilities for data protection among different stakeholders within an organization. Data accountability helps to ensure that data are handled appropriately and securely by authorized parties7.

D. Establishing a recovery point objective (RPO) for disaster recovery procedures is not a reason to implement a data retention policy, as it is more related to data backup than data retention. Data backup refers to the process of creating copies of data that can be restored in case of data loss or corruption. Data backup helps to ensure that data are available and recoverable in case of disaster8. RPO is a measure of the maximum amount of data that canbe lost or acceptable in case of disaster9. References: Data Retention Policy - ISACA, DataRetention - ISACA, Data Governance - ISACA, Data Accountability - ISACA, Data Backup - ISACA, Recovery Point Objective - ISACA

 The first step in assessing the controls within a newly implemented call center is to evaluate the operational risk associated with the call center. This will help the IS auditor to identify the potential threats, vulnerabilities, and impacts that could affect the call center’s objectives, performance, andavailability. The evaluation of operational risk will also provide a basis for determining the scope, objectives, and approach of the audit. The other options are possible audit procedures, but they are not the first step in the audit process. References: ISACA Frameworks: Blueprints for Success, CISA Review Manual (DigitalVersion)

The most critical factor for the effective implementation of IT governance is a supportive corporate culture. A supportive corporate culture is one that fosters collaboration, communication and commitment among all stakeholders involved in IT governance processes. A supportive corporate culture also promotes a shared vision, values and goals for IT governance across the organization. Strong risk management practices, internal auditor commitment or documented policies are important elements for IT governance implementation, but they are not sufficient without a supportive corporate culture. References: ISACA, CISA Review Manual, 27th Edition, 2018, page 41

The most useful metric for management to consider when reviewing a project portfolio is the net present value (NPV) of the portfolio. NPV is a measure of the profitability and value of a project or a portfolio of projects, taking into account the time value of money and the expected cash flows. NPV compares the present value of the future cash inflows with the present value of the initial investment and shows how much value is created or lost by undertaking a project or a portfolio of projects1. A positive NPV indicates that the project or portfolio is worth more than its cost and will generate a positive return on investment. A negative NPV indicates that the project or portfolio is worth less than its cost and will result in a loss. Therefore, NPV helps management to prioritize andselect the most profitable and valuable projects or portfolios that align with the organizational strategy and objectives2. The other options are less useful or incorrect because:

A. Cost of projects divided by total IT cost is not a useful metric for reviewing a project portfolio, as it does not reflect the benefits, value, or return of the projects. It only shows the proportion of IT budget allocated to the projects, which may not be indicative oftheir strategic importance or alignment3.

B. Expected return divided by total project cost is not a useful metric for reviewing a project portfolio, as it does not account for the time value of money and the timing of cash flows. It only shows the average return per unit of cost, which may not be comparable across different projects or portfolios with differentdurations, risks, and cash flow patterns4.

D. Total cost of each project is not a useful metric for reviewing a project portfolio, as it does not reflect the benefits, value, or return of the projects. It only shows theinitial investment required for eachproject, which may not be indicative of their profitability or viability5. References: Portfolio, Program and Project Management Using COBIT 5 - ISACA, Project PortfolioManagement - ISACA, CISA Review Manual (Digital Version), Standards, Guidelines, Tools and Techniques

 The most important thing for an IS auditor to look for in a project feasibility study is an assessment of whether the expected benefits can be achieved. A project feasibility study is a preliminary analysis that evaluates the viability and suitability of a proposed project based on various criteria, such as technical, economic, legal, operational, and social factors. The expected benefits are the positive outcomes and value that the project aims to deliver to the organization and its stakeholders. The IS auditor should verify whether the project feasibility study has clearly defined and quantified the expected benefits, and whether it has assessed the likelihood and feasibility of achieving them within the project scope, budget, schedule, and quality parameters. The other options are also important for an IS auditor to look for in a project feasibility study, but not as important as an assessment of whether the expected benefits can be achieved, because they either focus on specific aspects of the project rather than the overall value proposition, or they assume that the project will be implemented rather than evaluating its viability. References: CISA Review Manual (Digital Version)1, Chapter 4, Section 4.2.1

The primary role of a control self-assessment (CSA) facilitator is to focus the team on internal controls. A CSA facilitator is a person who guides the CSA process and helps the participants to identify, assess, and improve their internal controls. The facilitator does not conduct interviews, report on weaknesses, or provide solutions, as these are the responsibilities of the participants themselves1.

The other options are incorrect because they are not the primary role of a CSA facilitator. Option A, conduct interviews to gain background information, is a preliminary step that may be done by the facilitator or the participants before the CSA session, but it is not the main purpose of the facilitator. Option C, report on the internal control weaknesses, is an outcome of the CSA process that should be done by the participants who own and operate the controls. Option D, provide solutions for control weaknesses, is also an outcome of the CSA process that should be done by the participants who are in charge of implementing the improvements.

References:

ISACA, CISA Review Manual, 27th Edition, 2019, page 2822

ISACA, CISA Review Questions, Answers & Explanations Database - 12 Month Subscription, QID 1066693

PwC, Control Self Assessments4

Workiva, 4factors of an effective control self-assessment (CSA) program5

 The most important thing for an IS auditor to confirm when reviewing an organization’s plans to implement robotic process automation (RPA) to automate routine business tasks is that the end-to-end process is understood and documented. This is because RPA involves the use of software robots or digital workers to mimic human actions and execute predefined rules and workflows. Therefore, it is essential that the IS auditor verifies that the organization has a clear and accurate understanding of the current state of the process, the desired state of the process, the inputs and outputs, the exceptions and errors, the roles and responsibilities, and the performance measures12. Without a properdocumentation of the end-to-end process, the organizationmay face challenges in designing, developing, testing, deploying, and monitoring the RPA solution3. References: 1: CISA ReviewManual (Digital Version), Chapter 4: Information Systems Operations and Business Resilience, Section 4.2: IT Service Delivery and Support, page 211 2:CISA Online Review Course, Module 4: Information Systems Operations and Business Resilience, Lesson 4.2: IT Service Delivery and Support 3: ISACA Journal Volume 5, 2019, Article: Robotic Process Automation: Benefits, Risks and Controls

The best way to facilitate the legal process in the event of an incident is to preserve the chain of custody of the evidence. The chain of custody is a record of who handled, accessed, or modified the evidence, when, where, how, and why. The chain of custody helps to ensure the integrity, authenticity, and admissibility of the evidence in a court of law. The chain of custody also helps to prevent tampering, alteration, or loss of evidence that could compromise the investigation or the prosecution. References:

CISAReview Manual (Digital Version)

CISA Questions, Answers & Explanations Database

The most significant risk that IS auditors are required to consider for each engagement is the misalignment with business objectives. This is because IS audit engagements are intended to provide assurance that the IT systems and processes support the achievement of the business objectives and strategies. If there is a misalignment,it could result in wasted resources, missed opportunities, inefficiencies, errors, or failures that could adversely affect the organization’s performance and reputation12. References: 1: CISA Review Manual (Digital Version), Chapter 1: The Process of Auditing Information Systems, Section 1.3: Audit Risk, page 28 2: CISA Online Review Course, Module 1: The Process of Auditing Information Systems, Lesson 1.3: Audit Risk

 The greatest risk of using a reciprocal site for disaster recovery is the inability to utilize the site when required. A reciprocal site is an agreement between two organizations to provide backup facilities for each other in case of a disaster. However, this arrangement may not be reliable or enforceable, especially if both organizations are affected by the same disaster or have conflicting priorities. Therefore,the IS auditor should recommend that management consider alternative options for disaster recovery, such as dedicated sites or cloud services12. References:

CISA Review Manual, 27th Edition,page 3381

CISA Review Questions, Answers & Explanations Database - 12 Month Subscription

 A network vulnerability assessment is a process of identifying and evaluating the weaknesses and exposures in a network that could be exploited by attackers to compromise the confidentiality, integrity, or availability of the network or its resources. A network vulnerability assessment typically involves scanning the network devices, such as routers, switches, firewalls, servers, and workstations, using automated tools that compare the device configurations, software versions, and patch levels against a database of known vulnerabilities. A network vulnerability assessment can also include manual testing and verification of the network architecture, design, policies, and procedures. One of the main objectives of a network vulnerability assessment is to detect and report any misconfiguration and missing updates in the network devices that could pose a security risk1. Misconfiguration refers to any deviation from the recommended or best practice settings for the network devices, such as weak passwords, open ports, unnecessary services, default accounts, or incorrect permissions. Missing updates refer toany outdated or unsupported software or firmware that has not been patched with the latest security fixes or enhancements from the vendors2. Misconfiguration and missing updates are common sources of network vulnerabilities that can be exploited by attackers to gain unauthorized access, executemalicious code, causedenial of service, or escalate privileges on the network devices3. Therefore, an IS auditor should expect to see misconfiguration and missing updates in a network vulnerability assessment. The other options are less relevant or incorrect because:

B. Malicious software and spyware are not usually detected by a network vulnerability assessment, as they are more related to the content and behavior of the network traffic ratherthan the configuration and patch level of the network devices. Malicious software and spyware are programs that infect or monitor the network devices or their users for malicious purposes, such as stealing data, displaying ads, or performing remote commands. Malicious software and spyware can be detected by other security tools, such as antivirus software, firewalls, or intrusion detection systems4.

C. Zero-day vulnerabilities are not usually detected by a network vulnerability assessment, as they are unknown or undisclosed vulnerabilities that have not been reported or patched by the vendors or the security community. Zero-day vulnerabilities are rare and difficult to discover, as they require advanced techniques and skills to exploit them. Zero-day vulnerabilities can be detected by other security tools, such as intrusion prevention systems, anomaly detection systems, or artificial intelligence systems5.

D. Security design flaws are not usually detected by a network vulnerability assessment, as they are more related to the logic and functionality of the network rather than the configuration and patch level of the network devices. Security design flaws are errors or weaknesses in the network architecture, design, policies, or procedures that could compromise the security objectives of the network. Securitydesign flaws can be detected by other security methods, such as security reviews, audits, or assessments6. References: Network VulnerabilityAssessment - ISACA, Network Vulnerability Scanning - NIST, Network Vulnerabilities - SANS, Malware - ISACA, Zero-Day Attacks - ISACA, Security Design Principles - NIST

The best way to ensure data integrity across system interfaces is to perform reconciliation. Reconciliation is the process of comparing and verifying the data from different sources or systems to ensure that they are consistent, accurate, and complete. Reconciliation can help to identify and resolve any discrepancies, errors, or anomalies in the data that could affect the quality, reliability, or validity of the information. Reconciliation can also help to detect and prevent any unauthorized or fraudulent data manipulation or modification. References:

CISA Review Manual (Digital Version)

CISA Questions, Answers & Explanations Database

The first thing that an IS auditor should do when management responses to an in-person internal control questionnaire indicate a key internal control is no longer effective is to ascertain the existence of other compensating controls. Compensating controls are alternative controls that provide reasonable assurance of achieving the same objective as the original control. The IS auditor should verify whether there are any compensating controls in place that can mitigate the risk of the key control being ineffective, and evaluate their adequacy and effectiveness. The other options are not the first steps, because theyeither require more information about the compensating controls, or they are actions to be taken after identifying and assessing the compensating controls. References: CISA Review Manual (Digital Version)1, Chapter 2, Section 2.2.3

 The finding that should be the IS auditor’s greatest concern is that the data model is not clearly documented. A data model is a representation of the structure, relationships, and constraints of the data used by an application. It is a vital component of the software development process, as it helps to ensure the accuracy, consistency, and quality of the data1. A clear and comprehensive documentation of the data model is essential for the maintenance and support of the application, as it facilitates the understanding, modification, and troubleshooting of the data and the application logic2.

If the organization plans to bring the support and future maintenance of the application back in-house, it will need to have access to the data model documentation from the vendor. Without it, the organization may face difficulties in transferring the knowledge and skills from the vendor to the in-house team, as well as in adapting and enhancing the application to meet changing businessneeds and requirements3. The lack of data model documentation may also increase therisk of errors, inconsistencies, and inefficiencies in the data and the application performance2.

The other findings are not as concerning as the lack of data model documentation, because they do not directly affect the quality and maintainability of the application. The cost of outsourcing is lowerthan in-house development is a benefit rather than a risk for the organization, as it implies that outsourcing has helped to save time and money for the organization4. The vendor development team is located overseas is a common practice in outsourcing, and it does not necessarily imply a lower quality or a higher risk of the application. However, it may pose some challenges in terms of communication, coordination, and cultural differences, which can bemanaged by establishing clear expectations, roles, and responsibilities, as well as using effective tools and methods for communication and collaboration5. A training plan for business users has not been developed is a gap that should be addressed by the organization before deploying the application, as it may affect the user acceptance and satisfaction of the application. However, it does not directly impact the quality or maintainability of the application itself. References:

What is Data Modeling? Definition & Types | Informatica1

Data Modeling Best Practices: Documentation | erwin2

Data Model Documentation - an overview |ScienceDirect Topics3

Outsourcing App Development Pros and Cons – Droids On Roids4

8 Risks of Software Development Outsourcing & Their Solutions - Acropolium5

Software Training Plan: How to Create One for Your Business - Elinext

The most important factor to ensure that electronic evidence collected during a forensic investigation will be admissible in future legal proceedings is to document evidence handling by personnel throughout the forensic investigation. Documentation is essential to establish the chain of custody, prove the integrity and authenticity of the evidence, and demonstrate compliance with legal and ethical standards. Documentation should include information such as the date, time, location, source, destination, method, purpose, result, and authorization of each action performed on the evidence. Documentation should also include any observations, findings, assumptions, limitations, or exceptions encountered during the investigation. References:

CISA Review Manual (Digital Version)

CISA Questions, Answers & Explanations Database

The primary purpose of documenting audit objectives when preparing for an engagement is to identify areas with relatively high probability of material problems. Audit objectives are statements that describe what the audit intends to accomplish or verify during the engagement. Audit objectives help the IS auditor to focus on the key areas of risk or concern, to design appropriate audit procedures and tests, and to evaluate audit evidence and results. By documenting audit objectives, the IS auditor can identify areas with relatively high probability of material problems that may affect the achievement of audit goals or business objectives. Addressing the overall risk associated with the activity under review, ensuring maximum use of audit resources during the engagement and prioritizing and scheduling auditee meetings are also purposes of documenting audit objectives, but they are not as primary as identifying areas with high probability of material problems. References:

CISA Review Manual, 27th Edition, page 1111

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 The most effective way for an organization to help ensure agreed-upon action plans from an IS audit will be implemented is to ensure ownership is assigned. This means that the management of the audited area should accept responsibility for implementing the action plans and report on their progress and completion to the audit committee or senior management. This will ensure accountability, commitment, and follow-up for the audit recommendations34. References: 3: CISA ReviewManual (Digital Version), Chapter 1: The Process of Auditing Information Systems, Section 1.6: Reporting, page 41 4: CISA Online Review Course, Module 1: The Process of Auditing Information Systems, Lesson 1.6: Reporting

 The greatest concern for an IS auditor when a post-implementation review was conducted by issuing a survey to users is that the survey questions did not address the scope of the business case. A post-implementation review is a process of evaluating the outcomes and benefits of a project after it has been completed and implemented. A post-implementation review can help to assess whether the project met its objectives, delivered its expected value, and satisfied its stakeholders1. A survey is a method of collecting feedback and opinions from users or other stakeholders about their experience and satisfaction with the project. Asurvey can help to measure the user acceptance, usability, and functionality of the project deliverables2. A business case is a document that justifies the need for a project based on its expected benefits, costs, risks, and alternatives. A business case defines the scope,objectives, and requirements of the project and provides a basis for its approval and initiation3. Therefore, an IS auditor should be concerned if the survey questions did not address the scope of the business case, as it may indicate that the post-implementation review was not comprehensive, relevant, or aligned with the project goals. The other options are less concerning or incorrect because:

A. The survey results were not presented in detail to management is not a great concern for an IS auditor when a post-implementation review was conducted by issuing a survey to users, as it is more of a communication or reporting issue than an audit issue. While presenting the survey results in detail to management may help to inform them about the project performance and outcomes, it does not affect the validity or quality of the post-implementation review itself.

C. The survey form template did not allow additional feedback to be provided is not a great concern for an IS auditor when a post-implementation review was conducted by issuing a survey to users, as it is more of a design or format issue than an audit issue. While allowing additional feedback to be provided may help to capture more insights or suggestions from users, it does not affect the validity or quality of the post-implementation review itself.

D. The survey was issued to employees a month after implementation is not a great concern for an IS auditor when a post-implementation review was conducted by issuing a survey to users, as it is more of a timing or scheduling issue than an audit issue. While issuing the survey to employees sooner after implementation may help to collect more accurate and timely feedback from users, it does not affect the validity or quality of the post-implementation reviewitself. References: Post ImplementationReview - ISACA, Survey - ISACA, Business Case - ISACA

The necessary condition for effective risk management in IT governance is that risk evaluation is embedded in management processes. Risk evaluation is the process of comparing the results of risk analysis with risk criteria to determine whether the risk and/or its magnitude is acceptable or tolerable. Risk evaluation should be integrated into the management processes of planning, implementing, monitoring, and reviewing the IT activities and resources. This will ensure that risk management is aligned with the business objectives, strategies, and values, and that risk responses are timely, appropriate, and effective. References:

CISA Review Manual (Digital Version)

CISA Questions, Answers & ExplanationsDatabase

The first thing that should be performed before key performance indicators (KPIs) can be implemented is the identification of organizational goals. This is because KPIs are measurable values that demonstrate how effectively an organization is achieving its key business objectives4. Therefore, it is necessary that the organization defines its goals clearly and aligns them with its vision, mission, and strategy. By identifying its goals, the organization can then determine what KPIs are relevant and meaningful to measure its progress and performance . References: 4: CISA Review Manual (Digital Version), Chapter 2: Governance and Management of IT, Section 2.3: Benefits Realization, page 77 :CISA Online Review Course, Module 2: Governance and Management of IT, Lesson 2.3: Benefits Realization : ISACA Journal Volume 1, 2020, Article: How to Measure Anything in IT Governance

 The best way to help management understand the associated risk of missing backup cycles due to operator error and lack of exception management is to explain the impact to disaster recovery. Disaster recovery is the process of restoring normal operations and functions after a disruptive event, such as a natural disaster, a cyberattack, or a hardware failure. Backup cycles are essential for disaster recovery, because they ensure that the organization has copies of its critical data and systems that can be restored in case of data loss or corruption. If backup cycles are missed due to operator error, and these exceptions are not managed, the organization may not have the latest or complete backups available for disaster recovery, which can result in prolonged downtime, reduced productivity, lost revenue, reputational damage, and legal or regulatory penalties. The other options are not as effective asexplaining the impact to disaster recovery, because they either do not address the risk of data loss or corruption, or they focus on operational or technical aspects rather than business outcomes. References: CISA Review Manual (Digital Version)1, Chapter 5, Section 5.2.1

The associated risk of mobile computing that an IS auditor should identify during the planning phase of a data loss prevention (DLP) audit is increased vulnerability due to anytime, anywhere accessibility. Mobile computing refers to the use of portable devices, such as laptops, tablets, smartphones, or wearable devices, that can access data and applications over wireless networks from any location6. Mobile computing enables greater flexibility, productivity, and convenience for users, but also poses significant security challenges for organizations. One of these challenges is increased vulnerability due to anytime, anywhere accessibility. This means that mobile devices are exposed to a higher risk of loss, theft, damage, or unauthorized access than stationary devices7. If mobile devices contain oraccess sensitive data withoutproper protection, such asencryption or authentication, theycould result in data leakage or breach in case of compromise8. Therefore, an IS auditor should identify this risk as part of a DLP audit. The other options are less relevant or incorrect because:

A. The use of cloud negatively impacting IT availability is not an associated risk of mobile computing that an IS auditor should identify during the planning phase of a DLP audit, as it is more related to cloud computing than mobile computing. Cloud computing refers to the delivery of computing services, such as data storage or processing, over the Internet from remote servers. Cloud computing may enable or support mobile computing by providing access to data and applications from any device or location, but it does not necessarily imply mobile computing. The use of cloud may negatively impact IT availability if there are disruptions or outages in the cloud service provider’s network or infrastructure, but this is not a direct consequence of mobile computing.

B. Increased need for user awareness training is not an associated risk of mobile computing that an IS auditor should identify during the planning phase of a DLP audit, as it is more of a control or mitigation measure than a risk. User awareness training refers to educating users about security policies, procedures, and best practices for using mobile devices and protecting data. User awareness training may help to reduce the risk of data loss or breach due to mobile computing by increasing user knowledge and responsibility, but it does not eliminate or prevent the risk.

D. Lack of governance and oversight for IT infrastructure and applications is not an associated risk of mobile computing that an IS auditor should identify during the planning phase of a DLP audit, as it is more of a general or organizational risk than a specific or technical risk. Governance and oversight refer to the establishment and implementation of policies, standards, and procedures for managing IT resources and aligning them with business objectives. Lack of governance and oversight for IT infrastructure and applications may affect the security and performance of mobile devices and data, but it is not a direct or inherent result of mobile computing. References: Mobile Computing - ISACA, Mobile Computing Device Threats, Vulnerabilities and Risk Factors Are Ubiquitous - ISACA, Data Loss Prevention—Next Steps -ISACA, [Cloud Computing - ISACA], [Cloud Computing Risk Assessment - ISACA], [User Awareness Training - ISACA], [Governance and Oversight - ISACA]

The greatest risk associated with the situation of business units purchasing cloud-based applications without IT support is that the applications may not reasonably protect data. Cloud-based applications are software applications that run on the internet, rather than on a local device or network. Cloud-based applications offer manybenefits, such as scalability, accessibility, and cost-effectiveness, but they also pose many challenges and risks, especially for data security1.

Data security is the process of protecting data from unauthorized access, use, modification, disclosure, or destruction. Data security is essential for ensuring the confidentiality, integrity, and availability of data, as well as complying with legal and regulatory requirements. Data security is especially important for cloud-based applications, as data are stored and processed on remote servers that are owned and managed by third-party cloud service providers (CSPs)2.

When business units purchase cloud-based applications without IT support, they may not be aware of or follow the best practices and standards for data security in the cloud. They may not performadequate risk assessments, vendor evaluations, contract reviews, or audits to ensure that the CSPs and the applications meet the organization’s data security policies and expectations. They may not implement appropriate data encryption, backup, recovery, or disposal methods to protect the data in transit and atrest. They may not monitor or control the access and usage of the data by internal or external users. They may not report or respond to any data breaches or incidents that may occur3.

These actions or inactions may expose the organization’s data to various threats and vulnerabilities in the cloud, such as cyberattacks, human errors, malicious insiders, misconfigurations, or legal disputes. These threats and vulnerabilities may result in data loss, leakage, corruption, or compromise, which may have serious consequences for theorganization’s reputation, operations, performance, compliance, and liability4.

Therefore, it is essential that business units consult and collaborate with IT support before purchasing any cloud-based applications, and follow the organization’s guidelines and procedures for cloud security. IT support can help business units to select and use cloud-based applications that are suitable and secure for their needs and objectives.

References:

Top 5 Risks With Cloud Software and How to Mitigate Them4

Mitigate risksand secure your cloud-native applications3

12 Risks, Threats & Vulnerabilities in Moving to the Cloud2

Best Practices to Manage Risks in the Cloud1

Data disposal controls are the measures that ensure that data are securely and permanently erased or destroyed when they are no longer needed or authorized to be retained. Data disposal controls support business strategic objectives by reducing the risk of data breaches, complying with dataprivacy regulations, optimizing the use of storage resources, and enhancing the reputation and trust of the organization1.

A media sanitization policy is a document that defines the roles, responsibilities, procedures, and standards for sanitizing different types of media that contain sensitive or confidential data. Media sanitization is the process of removing or modifying data on a media device to make it unreadable or unrecoverable by any means. Media sanitization can be achieved by various methods, such as overwriting, degaussing, encryption, or physical destruction2.

A media sanitization policy would provide an IS auditor with the greatest assurance that data disposal controls support business strategic objectives because it demonstrates that the organization has a clear and consistent approach to protect its data from unauthorized access or disclosure throughout the data life cycle. Amedia sanitization policy also helps the organization to comply with various data privacy regulations, such as the EU General Data Protection Regulation (GDPR), the US Health Insurance Portability and Accountability Act (HIPAA), or the Payment Card Industry Data Security Standard (PCI DSS), that require proper disposal of personal or sensitive data3.

The other options are not as effective as a media sanitization policy in providing assurance that data disposal controls support business strategic objectives. A media recycling policy is a document that defines the criteria and procedures for reusing media devices that have been sanitized or erased. A media recycling policy can help the organization to save costsand reduce environmental impact, but it does not address how the data are disposed of in the first place4. A media labeling policy is a document that defines the rules and standards for labeling media devices that contain sensitive or confidential data. A media labeling policy can help the organization to identify and classify its data assets, but itdoes not specify how the data are sanitized or destroyed when they are no longer needed. A media shredding policy is a document that defines the methods and procedures for physically destroying media devices that contain sensitive or confidential data. A media shredding policy can be a part of a media sanitization policy, but it is not sufficient to cover all types of media devices or data disposal scenarios.

References:

ISACA, CISA Review Manual, 27th Edition, 2019

ISACA, CISA Review Questions, Answers & Explanations Database - 12 Month Subscription

Secure Data Disposal and Destruction: 6 Methods to Follow1

Why (and How to) Dispose of Digital Data2

What is Data Disposition? The Complete Guide3

Data Disposition: What is it and why should it be part of your data retention policy?

The best metric to measure the alignment of IT and business strategy is the percentage of enterprise risk assessments that include IT-related risk. This metric indicates how well the organization identifies and manages the IT risks that could affect its strategic objectives and performance. A high percentage of enterprise risk assessments that include IT-related risk shows that the organization considers IT as an integral part of its business strategy and aligns its IT resources and capabilities with its business needs and goals . References: : CISA Review Manual (Digital Version), Chapter 2: Governance and Management of IT, Section 2.2: IT Strategy, page 67 : CISA Online Review Course, Module 2: Governance and Management of IT, Lesson 2.2: IT Strategy

The best control to mitigate attacks that redirect Internet traffic to an unauthorized website is to perform domain name system (DNS) server security hardening. DNS servers are responsible for resolving domain names into IP addresses, and they are often targeted by attackers who want to manipulate or spoof DNS records to redirect usersto malicious websites4. By applying security best practices to DNS servers, such as encrypting DNS traffic, implementing DNSSEC, restricting access and updating patches, the organization can reduce the risk of DNS hijacking attacks. A network-based firewall, user security awareness training and a strong password policy are also important controls, but they are not as effective as DNS server security hardening in preventing this specific type of attack. References:

CISA Review Manual, 27th Edition, page 4021

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File transfer protocol (FTP) is a service that allows users to transfer files between computers over a network. If enabled within firewall rules, FTP would present the greatest risk, as it can expose sensitive data to unauthorized access, modification, or deletion. FTP does not provide encryption or authentication, which makes it vulnerable to eavesdropping, spoofing, and tampering attacks. Simple mail transfer protocol (SMTP), simple object access protocol (SOAP), and hypertext transfer protocol (HTTP) are also services that can be used to exchange data over a network, but they have more security features than FTP, such as encryption, authentication, or validation. References: CISA Review Manual (Digital Version)

Integration testing is the best way to ensure that an application is performing according to its specifications, because it tests the interaction and compatibility of different modules or components of the application. Unit testing, pilot testing and system testing are also important, but they do not coverthe whole functionality and integration of the application as well as integration testing does. References: CISA Review Manual (Digital Version)1, Chapter 4, Section 4.2.3

 The best way to ensure that a backup copy is available for restoration of mission critical data after a disaster is to periodically test backups stored in a remote location. Testing backups is essential to verify that the backup copies are valid, complete, and recoverable. Testing backups also helps to identify any issues or errors that may affect the backup process or the restoration of data. Storing backups in a remote location is important to protect the backup copies from physical damage, theft, or unauthorized access that may occur at the primary site. Using an electronic vault for incremental backups, deploying a fully automated backup maintenance system, or using both tape and disk backup systems are not sufficient to ensure that a backup copy is available for restoration of mission critical data after a disaster, as they do not address the need for testing backups or storing them in a remote location. References: Backup and Recovery of Data: The Essential Guide | Veritas, The Truth About Data Backup for Mission-Critical Environments - DATAVERSITY.

The best way to ensure that potential security issues are considered by the development team as part of incremental changes to agile-developed software is to include a mandatory step to analyze the security impact when making changes. This will help to identify and mitigate any security risks or vulnerabilities that may arise from the changes, and to ensure that the software meets the security requirements and standards. The other options are not as effective, because they either delegate thesecurity analysis to someone outside the development team, rely on post-deployment testing, or focus on documentation rather than analysis. References: CISA Review Manual (Digital Version)1, Chapter 4, Section 4.2.5

 In a controlled application development environment, the most important segregation of duties should be between the person who implements changes into the production environment and the application programmer. This segregation of duties ensures that no one person can create and deploy code without proper review, testing, and approval. This reduces the risk of errors, fraud, or malicious code being introduced into the production environment.

The other options are not as important as the segregation between the application programmer and the person who implements changes into production, but they are still relevant for achieving a secure and reliable application development environment. The segregation of duties between the person who implements changes into production and the systems programmer is important to prevent unauthorized or untested changes to system software or configuration. The segregation of duties between the person who implements changes into production and the computer operator is important to prevent unauthorized or uncontrolled access to production data or resources. The segregation of duties between the person who implements changes into production and the quality assurance (QA) personnel is important to ensure independent verification and validation of code quality and functionality.

References:

ISACA CISA Review Manual 27th Edition (2019), page 247

Segregation of Duties in an Agile Environment | AKF Partners3

Separation of Duties: How to Conform in a DevOps World4

The most important thing to determine during the planning phase of a cloud-based messaging and collaboration platform acquisition is the types of data that can be uploaded to the platform. This is because different types of data may have different security, privacy, and compliance requirements, depending on the nature, sensitivity, and value of the data. For example, personal data, financial data, health data, or intellectual property data may be subject to various laws and regulations thatgovern how they can be collected, stored, processed, and shared in the cloud. Therefore, it is essential to identify and classify the types of data that will be uploadedto the platform, and ensure that the platform meets the organization’s policies and standards for data protection1.

The other options are not as important as the types of data that can be uploaded to the platform during the planning phase of a cloud-based messaging and collaboration platform acquisition. Option A, role-based access control policies, is a mechanism that defines who can access what data and resources on the platform based on their roles and responsibilities. Role-based access control policies are important for ensuring data security and accountability, but they can be designed and implemented after the platform is acquired2. Option C, processes for on-boarding and off-boarding users to the platform, are procedures that enable or disable user accounts and access rights on the platform. Processes for on-boarding and off-boarding users are important for managing user identities and lifecycles, but they can be developed and executed after the platform is acquired3. Option D, processes for reviewing administrator activity, are methods that monitor and audit the actions and events performed by administrators on the platform. Processes for reviewing administrator activity are important for detecting and preventing unauthorized or malicious activities, but they can be established and performed after the platform is acquired4.

References:

Cloud Messaging and Collaboration Services - Maryland.gov DoIT4

MessageBird acquires real-time notifications and in-app messaging platform Pusher for$35M | TechCrunch2

Symphony to lead financial market communicationswith the acquisition of Cloud9 Technologies3

Cloud messaging and collaboration | Sumo Logic

 An IS auditor reviewing the threat assessment for a data center would be most concerned if the exercise was completed by local management, because this could introduce bias, conflict of interest, or lack of expertise in the assessment process. A threat assessment is a systematic method of identifying and evaluating the potential threats that could affect the availability, integrity, or confidentiality of the data center and its assets. A threat assessmentshould be conducted by an independent and qualified team that has the necessary skills, knowledge, and experience to perform a comprehensive and objective analysis of the data center’s environment, vulnerabilities, and risks1.

The other options are not as concerning as option C for an IS auditor reviewing the threat assessment for a data center. Option A, some of the identified threats are unlikely to occur, is not a problem as long as the likelihood and impact of each threat are properly estimated and prioritized. A threat assessment should consider all possible scenarios, even if they have a low probability of occurrence, to ensure that the data center is prepared for any eventuality2. Option B, all identified threats relate to external entities, is not a flaw as long as the assessment also considers internal threats, such as human errors, malicious insiders, or equipment failures. External threats are often more visible and severe than internal threats, butthey are not the only source of risk for a data center3. Option D, neighboring organizations’ operations have been included, is not a mistake as long as the assessment also focuses on the data center’s own operations. Neighboring organizations’ operations may have an impact on the data center’s security and availability, especially if they share physical or network infrastructure or resources. A threat assessmentshould take into account the interdependencies and interactions between the data center and its external environment4.

References:

ISACA, CISA Review Manual, 27th Edition, 2019

ISACA, CISA Review Questions, Answers & Explanations Database - 12 Month Subscription

Data Center Threats and Vulnerabilities1

Datacenter threat, vulnerability, and risk assessment2

Data Centre Risk Assessment3

Comprehensive and Detailed Step-by-Step Explanation:

When an employee exploits avulnerability, the most appropriate audit is aforensic audit, as it focuses oninvestigating and documenting security incidentsfor legal or disciplinary action.

Option A (Incorrect):Acompliance auditensures adherence to policies but does not investigate incidents in detail.

Option B (Incorrect):Application security testinghelps identify vulnerabilities but does not addressemployee misuse.

Option C (Correct):Aforensic auditgathersdigital evidence, determines how the exploit occurred, and ensures legal compliance in the investigation.

Option D (Incorrect):Penetration testingidentifies weaknesses but does notanalyze past incidents.

A BCP must stay current with organizational changes to ensure its effectiveness during a disruption. Personnel changes and environmental updates are directly relevant to how the BCP would be executed.

References

ISACA CISA Review Manual (Current Edition) - Chapter on Business Continuity and Disaster Recovery

Industry Standards (e.g., ISO 22301, NIST SP 800-34) - Guidelines for maintaining and updating a Business Continuity Plan

Comprehensive and Detailed Step-by-Step Explanation:

When outsourcingIS functions,independent audit provisionsensure thatcontractors meet security, compliance, and operational standards.

Option A (Incorrect):Security procedures should be included but are subject tochangeandmay not be detailedin the contract.

Option B (Correct):Independent audit rightsallow the organization toverifythat the vendor complies with security, operational, and regulatory requirements.

Option C (Incorrect):Naming specific staff isimpracticaland not acore contractual requirement.

Option D (Incorrect):Data transfer protocols are important, but they are atechnical detailrather than aprimary contract requirement.

Using risk assessments to determine areas to be included in an audit plan is a primary benefit because it helps to prioritize the audit activities based on the level of risk and the potential impact of the audit findings. This way, the audit resources, such as time, staff, and budget, can be allocated more efficiently and effectively to the areas that need the most attention and provide the most value.

References

ISACA CISA Review Manual, 27th Edition, page 256

What is the Purpose of a Risk Assessment?

Mastering the Process of Risk Assessment

A balanced scorecard is a strategic planning framework that companies use to assign priority to their products, projects, and services; communicate about their targets or goals; and plan their routine activities1. The scorecard enables companies to monitor and measure the success of their strategies to determine how well they have performed. A balanced scorecard for IT management can help assess IT functions and processes by defining four perspectives: financial, customer, internal business process, and learning and growth2. These perspectives can help IT management align their IT objectives with the organization’s vision and mission, identify and prioritize the key performance indicators (KPIs) for IT, and evaluate the effectiveness and efficiency of IT operations and services3.

References

1: Balanced Scorecard - Overview, Four Perspectives 2: The IT Balanced Scorecard (BSC) Explained - BMC Software 3: A BALANCED SCORECARD (BSC) FOR IT PERFORMANCE MANAGEMENT - SAS Support

Comprehensive and Detailed Step-by-Step Explanation:

IfIT is not involvedinstrategic planning,IT strategy may diverge from business needs, leading tomisalignment and inefficiencies.

Option A (Incorrect):Business strategy alignmentis important, but the greater risk is thatIT investments do not support business goals.

Option B (Incorrect):Lack of emerging technology awareness is a risk, butIT-business misalignment has broader consequences.

Option C (Correct):Thegreatest riskis when IT strategyfails to align with business objectives, leading towasted investments, inefficiencies, and competitive disadvantages.

Option D (Incorrect):IT goals being overlooked is a concern, butmisalignment of IT and business strategies is a more critical risk.

SQL injection attacks exploit vulnerabilities in web applications by inserting malicious SQL code into input fields, such as a search box. This can cause the server to execute unintended commands, often revealing restricted information.

Man-in-the-Middle (Option A):This intercepts communication but does not involve code injection.

Denial of Service (DoS) (Option B):This aims to disrupt service, not extract information.

Cross-Site Scripting (Option D):Involves injecting malicious scripts to execute in a user's browser but does not extract server-side data.

Generalized audit software is a type of computer-assisted audit technique (CAAT) that allows the IS auditor to perform various audit tasks on the data stored in different file formats and databases1. Generalized audit software can help the IS auditor to select a sample for testing that includes the 80 largest client balances and a random sample of the rest, by using functions such as sorting, filtering, stratifying, and randomizing the data23. Generalized audit software can also help the IS auditor to perform other audit procedures on the sample, such as verifying the accuracy, completeness, and validity of the data4.

References

1: Generalized Audit Software (GAS) - ISACA 2: Audit Sampling - ISACA 3: How to use generalized audit software to perform audit sampling 4: Generalized Audit Software: A Review of Five Packages

EVA is a project management technique that measures the performance of a project by comparing the actual work completed, the actual costs incurred, and the planned costs for the work scheduled. EVA can help determine if the project is on track, ahead of schedule, or behind schedule, and if the project isunder budget, over budget, or on budget. EVA can also help forecast the final cost and schedule of the project based on the current performance.

References

ISACA CISA Review Manual, 27th Edition, page 255

18. Project Completion – Project Management – 2nd Edition

How to Measure Project Success | Smartsheet

Comprehensive and Detailed Step-by-Step Explanation:

Forensic investigations require unaltered digital evidenceto be admissible in court.Write-protectionensures that the original data remains intact.

Option A (Correct):Write-protecting mediapreventsaccidental or malicious changesto evidence, ensuring its integrity.

Option B (Incorrect):Creating a digital imageis useful, but if the original evidence is modified, the integrity is lost.

Option C (Incorrect):Hash valueshelp detect changes but donot preventthem.

Option D (Incorrect):Chain of custodyensures accountability but doesnot physically protect the evidence.

Comprehensive and Detailed Step-by-Step Explanation:

Monitoringcapacity utilizationsupportsavailabilityby ensuring thatresources remain functional and do not exceed operational limits.

Option A (Incorrect):Integrityensures that data isaccurate and unaltered, but monitoring capacity thresholds primarily relates tosystem availability.

Option B (Correct):Availabilityensures that systems remainaccessible and functional, and monitoring capacity utilization helpsprevent downtimeandservice disruptions.

Option C (Incorrect):Confidentialityensures that data isprotected from unauthorized access, which is unrelated to capacity monitoring.

Option D (Incorrect):Nonrepudiationensures that actions can betraced to specific individuals, but it does not relate tocapacity monitoring.

Benford’s law analysis is a powerful technique for identifying irregularities or anomalies in numerical datasets, such as financial transactions. It detects deviations from expected frequency distributions, which may indicate fraud.

Control Self-Assessments (CSAs) (Option A):Useful for control evaluation but not for fraud detection.

Interviews with Control Owners (Option B):Provide insights but are not efficient for identifying fraudulent patterns.

Regression Analysis (Option C):Effective for predictive modeling but less so for detecting fraud in transactional data.

IT application owners having sole responsibility for architecture approval (B) is a major concern because it indicates a lack of oversight and segregation of duties.EA decisions should be reviewed by a cross-functional governance body to ensure alignment with security, compliance, and business objectives.

Other options:

The CIO chairing the review board (A)may indicate centralized leadership but is not inherently a risk.

EA governing non-IT projects (C)may indicate scope expansion but is not a security risk.

Security requirements being reviewed (D)is a best practice and not a concern.

Comprehensive and Detailed Step-by-Step Explanation:

When storage space is limited,incremental backupsare the most efficient because they store only the changes made since the last backup, reducing storage requirements.

Option A (Correct):Incremental backupsonly store data that has changed since the last backup, significantly reducing storage usage while maintaining a historical record of changes.

Option B (Incorrect):Mirror backupscreate an exact copy of the entire system, consuming significant storage space andnot retaining historical versions.

Option C (Incorrect):Full backupscapture everything and require large amounts of storage, making them impractical for space-constrained environments.

Option D (Incorrect):Annual backupsrefer to frequency rather than method. They do not inherently optimize storage usage.

AWeb Application Firewall (WAF) (A) is the best control to mitigate SQL injection attacks because it can detect and block malicious SQL queries before they reach the application.WAFs analyze incoming requests, filter SQL injection attempts, and provide an additional layer of security for web applications.

Other options:

SQL server hardening (B)improves security but does not specifically address SQL injection.

Patch management (C)is necessary but does not provide immediate protection against new SQL injection attacks.

Physical controls (D)are unrelated to application-layer threats like SQL injection.

Quarterly steering committee meetings best demonstrate alignment of the IT department with the corporate mission because they provide a regular forum for strategic planning, decision making, and communication between IT leaders and business stakeholders12. Steering committee meetings help toensure that IT goals and initiatives are aligned with the business vision, mission, and objectives, and that IT performance and value are monitored and evaluated34.

References

1: IT Governance and the Balanced Scorecard - ISACA Journal

2: IT Steering Committee Best Practices: A Recipe for Success

3: What is IT Governance? - Definition from Techopedia

4: CISA Cybersecurity Strategic Plan | CISA

The best course of action for a security administrator who is called in the middle of the night by the on-call programmer who needs access to the live system is to give the programmer an emergency ID for temporary access and review the activity. This is because:

Requiring that a change request be completed and approved may delay the resolution of the problem and cause further damage or disruption to the system or business operations. A change request is a formal document that describes the proposed change, its rationale, impact, benefits, risks, costs, and approval process. A change request is usually required for planned or scheduled changes, not for emergency or urgent changes.

Giving the programmer read-only access to investigate the problem may not be sufficient or effective, as the programmer may need to perform actions or tests that require write or execute permissions. Read-only access means that the user can only view or copy data or files, but cannot modify or delete them.

Reviewing activity logs the following day and investigating any suspicious activity may not prevent or detect any unauthorized or malicious actions by the programmer in real time. Activity logs are records of events and actions that occur within a system or network. Activity logs can provide evidence and accountability for system activities, but they are not proactive or preventive controls.

Therefore, giving the programmer an emergency ID for temporary access and reviewing the activity is the best course of action, as it allows the programmer to access the live system and resolve the problem quickly, while also ensuring that the security administrator can monitor and verify the programmer’s activity and revoke the access when it is no longer needed. An emergency ID is a temporary account that grants a user elevated privileges or access to a system or resource for a specific purpose and duration. An emergency ID should be:

Created and authorized by a security administrator or manager

Assigned to a specific user and purpose

Limited in scope and time

Logged and audited

Revoked and deleted after use

Some of the best practices for emergency access to live systems are12:

Establish clear policies and procedures for requesting, approving, granting, monitoring, reviewing, and revoking emergency access

Define criteria and scenarios for emergency access, such as severity, impact, urgency, and risk

Implement controls to prevent unauthorized or unnecessary use of emergency access, such as multifactor authentication, approval workflows, alerts, notifications, and time restrictions

Implement controls to track and audit emergency access activities, such as logging, reporting, analysis, and investigation

Implement controls to ensure accountability and responsibility for emergency access users, such as attestation, justification, documentation, and feedback

The auditor’s best recommendation is D. Introduce problem management into incident response. Problem management is a practice that aims to identify, analyze, and resolve the root causes of recurring incidents, and prevent or reduce their impact in the future1. Problem management can help improve the resolution times for recurring incidents by eliminating or mitigating the underlying problems that cause them, and by providing permanent solutions that can be reused or automated2. Problem management can also help improve the quality and efficiency of incident response by reducing the workload and complexity of dealing with repetitive issues2.

 The best recommendation to address the situation of inconsistencies in privacy requirements across third-party service provider contracts is to prioritize contract amendments for third-party providers. This is because:

Privacy requirements are essential to ensure the protection of personal information and compliance with relevant laws and regulations, such as the GDPR and the CCPA123.

Inconsistencies in privacy requirements can create risks of data breaches, legal liabilities, reputational damage, and consumer distrust for the organization that outsources its data processing to third-party providers123.

Suspending contracts with third-party providers that handle sensitive data (option A) is not a feasible or effective solution, as it may disrupt the business operations and cause contractual penalties or disputes4.

Reviewing privacy requirements when contracts come up for renewal (option C) is not a proactive or timely approach, as it may leave the organization exposed to privacy risks for a long period of time until the contracts expire4.

Requiring third-party providers to sign nondisclosure agreements (NDAs) (option D) is not a sufficient measure, as NDAs only cover the confidentiality of information, but not other aspects of privacy, such as data minimization, retention, access, deletion, and security4.

Therefore, the best recommendation is to prioritize contract amendments for third-party providers (option B), as this would allow the organization to align the privacy requirements with its own policies and standards, as well as with the applicable laws and regulations. This would also enable the organization to monitor and audit the compliance of third-party providers with the privacy requirements and enforce appropriate remedies or sanctions in case of noncompliance45.

References: 1: Understanding CPRA service provider contract requirements - Transcend 2: What you must know about ‘third parties’ under GDPR and CCPA 3: Data Privacy Implications for Service Provider & Third-Party Contracts 4: Privacy and outsourcing for businesses - Office of the Privacy Commissioner of Canada 5: Data Security Guidelines for outsourcing and third party compliance - European Union Agency for Network and Information Security

Automated version control systems are the best method to maintain an audit trail of changes made to the source code of a program. They automatically track and manage changes to the source code over time, allowing you to see what changes were made, when they were made, and who made them1. This provides a clear and detailed audit trail that can be invaluable for debugging, understanding the evolution of the code, and ensuring accountability23.

To detect unauthorized disclosure of confidential documents sent over corporate email, monitoring all emails based on pre-defined criteria is the best approach. This involves setting up automated monitoring systems that analyze email content, attachments, and metadata to identify any potential unauthorized disclosures. By defining specific criteria (such as keywords related to confidential information), organizations can proactively detect and prevent leaks. Requiring encryption before sending documents (option A) is important but does not address monitoring for unauthorizeddisclosures. Firewalls (option B) protect the network but do not specifically focus on email content. Reporting outgoing emails marked as confidential (option C) relies onuser self-reporting and may not catch all incidents12. References: 1(https://www.isaca.org/resources/isaca-journal/past-issues/2010/data-governance-for-privacy-confidentiality-and-compliance-a-holistic-approach) 2(https://www.isaca.org/resources/news-and-trends/newsletters/atisaca/2020/volume-6/best-practices-for-privacy-audits)

The most useful thing to do when planning to audit an organization’s compliance with cybersecurity regulations in foreign countries is to map the different regulatory requirements to the organization’s IT governance framework. This is because an IT governance framework is a roadmap that defines the methods used by an organization to implement, manage and report on IT governance within said organization1. IT governance helps align business and IT strategies using a solid and formal framework2. By mapping the different regulatory requirements to the IT governance framework, the auditor can:

Identify the commonalities and differences among the various cybersecurity regulations that apply to the organization’s operations in different countries.

Assess the level of compliance and maturity of the organization’s IT governance practices against each regulatory requirement.

Evaluate the risks and gaps associated with non-compliance or partial compliance with any of the regulatory requirements.

Recommend appropriate actions or improvements to enhance the organization’s IT governance and cybersecurity posture.

Option D is correct because mapping the different regulatory requirements to the organization’s IT governance framework is a systematic and effective way to plan and conduct an audit of compliance with cybersecurity regulations in foreign countries.

The greatest segregation of duties conflict would occur if the individual who performs the related tasks also has approval authority for purchase requisitions and purchase orders. This is because these two tasks are directly related to each other and involve financial transactions. If the same person is responsible for both tasks, it could lead to potential fraud or error12. For instance, the individual could approve a purchase order for a personal need and then also approve the payment for it, leading to misuse of company funds12.

References:

Segregation of Duties: Examples of Roles, Duties & Violations - Pathlock

Functions in the Purchasing Process and how to Segregate Purchasing Duties

 A transaction processing system (TPS) is a system that captures, processes, and stores data related to business transactions1. A general ledger is a system that records the financial transactions of an organization in different accounts2. An interface is a connection point between two systems that allows data exchange3. A system fix is a change or update to a system that resolves a problem or improves its functionality4.

The IS auditor should recommend to perform periodic reconciliations to validate the interface between the TPS and the general ledger is working in the future. A reconciliation is a process of comparing and verifying the data in two systems to ensure accuracy and consistency1. By performing periodic reconciliations, the IS auditor can detect and correct any errors or discrepancies in the data, such as duplicate transactions, missing transactions, or incorrect amounts. This way, the IS auditor can ensure the reliability and integrity of the financial data in both systems.

The other options are not as effective as periodic reconciliations to validate the interface. System owner sign-off for the system fix is a form of approval that indicates the system owner agrees with the change and its expected outcome4. However, this does not guarantee that the system fix will work as intended or prevent future errors. Conducting functional testing is a process of verifying that the system performs its intended functions correctly and meets its requirements4. However, this is usually done before or after the system fix is implemented, not on an ongoing basis. Improving user acceptance testing (UAT) is a process of evaluating whether the system meets the needs and expectations of the end users4. However, this is also done before or after the system fix is implemented, not on an ongoing basis. Therefore, option A is the correct answer.

References:

Transaction Interface: Organization, Process, and System

Validation of Interfaces - Ensuring Data Integrity and Quality across Systems

Oracle Payments Implementation Guide

Receiving Transactions Inserted Into Interface Table as BATCH And PENDING Are Not Processed By Receiving Transaction Processor

What Is a Transaction Processing System (TPS)? (Plus Types)

Reviewing the application implementation documents is the best way for an IS auditor to assess the design of an automated application control. An automated application control is a control that is embedded in the application software and is executed by the system without human intervention. An automated application control is designed to ensure the accuracy, completeness, validity, and authorization of transactions and data processed by the application. Examples of automated application controls are input validation, edit checks, calculations, reconciliations, and exception reports.

The application implementation documents are the documents that describe the design specifications, logic, and functionality of the application and its controls. The application implementation documents may include:

Business requirements document - a document that defines the business objectives, needs, and expectations of the application.

Functional specifications document - a document that describes the features, functions, and interfaces of the application and its controls.

Technical specifications document - a document that details the technical architecture, design, and configuration of the application and its controls.

Test plan and test cases - a document that outlines the testing strategy, methodology, and scenarios for verifying the functionality and performance of the application and its controls.

User manual and training material - a document that provides instructions and guidance on how to use the application and its controls.

By reviewing the application implementation documents, an IS auditor can:

Gain an understanding of the purpose, scope, and nature of the application and its controls.

Evaluate whether the application and its controls are designed to meet the business requirements and objectives.

Identify any gaps, inconsistencies, or errors in the design of the application and its controls.

Compare the design of the application and its controls with the best practices and standards in the industry.

Determine whether the application and its controls are adequately tested and documented.

Interviewing the application developer is not the best way for an IS auditor to assess the design of an automated application control. An interview is a verbal communication technique that involves asking questions and listening to responses. An interview can be useful for obtaining general information or clarifying specific issues related to the application and its controls. However, an interview alone cannot provide sufficient evidence or documentation to support the auditor’s assessment of the design of an automated application control. An interview may also be subject to bias, misunderstanding, or misinterpretation by either party.

Obtaining management attestation and sign-off is not the best way for an IS auditor to assess the design of an automated application control. Management attestation and sign-off is a formal process that involves obtaining written confirmation from management that they have reviewed and approved the design of the application and its controls. Management attestation and sign-off can indicatemanagement’s commitment and accountability for the quality and effectiveness of the application and its controls. However, management attestation and sign-off cannot substitute for an independent and objective evaluation by an IS auditor. Management attestation and sign-off may also be influenced by pressure, conflict of interest, or fraud.

Reviewing system configuration parameters and output is not the best way for an IS auditor to assess the design of an automated application control. System configuration parameters are settings that define how the system operates or interacts with other components. System output is data or information that is produced by the system as a result of processing transactions or performing functions. Reviewing system configuration parameters and output can help an IS auditor to verify whether the system is configured correctly and whether it produces accurate and reliable output. However, reviewing system configuration parameters and output cannot provide a comprehensive view of how the application and its controls are designed to achieve their objectives. Reviewing system configuration parameters and output may also require technical expertise or access rights that may not be available to an IS auditor.

The best tool for detailed testing of a business application’s data and configuration files is an audit analytics tool. An audit analytics tool is a software that helps auditors to analyze large sets of data and identify anomalies, trends, and patterns that are relevant to the audit objectives. An audit analytics tool can also provide audit evidence and support the auditor’s professional judgment and conclusions.

Some of the benefits of using an audit analytics tool are:

It can improve the efficiency and effectiveness of the audit by reducing the time and effort required to perform manual tests and procedures.

It can enhance the quality and reliability of the audit by increasing the coverage and accuracy of the data analysis and testing.

It can enable the auditor to perform more complex and sophisticated tests and procedures that may not be possible or feasible with traditional methods.

It can help the auditor to discover new insights and risks that may not be apparent or detectable with traditional methods.

Some examples of audit analytics tools are:

IDEA: A data analysis software that allows auditors to import, analyze, and visualize data from various sources and formats. It also offers features such as sampling, stratification, gap analysis, duplicate detection, Benford’s law, and regression analysis.1

ACL: A data analysis software that helps auditors to access, analyze, and report on data from various sources and formats. It also offers features such as sampling, stratification, gap analysis, duplicate detection, Benford’s law, regression analysis, and scripting.2

TeamMate Analytics: A data analysis software that integrates with Microsoft Excel and provides auditors with a range of tools and functions to perform data analysis and testing. It also offers features such as sampling, stratification, gap analysis, duplicate detection, Benford’s law, regression analysis, and scripting.3

 The risk assessment process involves identifying the information assets that are at risk, analyzing the threats and vulnerabilities that could affect them, evaluating the impact and likelihood of a risk event, and determining the appropriate controls to mitigate the risk. The first step is to identify the information assets, as they are the objects of protection and the basis for the rest of the process. Without knowing what assets are at risk, it is not possible to assess their value, exposure, or protection level. References: ISACA Frameworks: Blueprints for Success

Substantive testing © provides the best evidence of the validity and integrity of logs in an organization’s security information and event management (SIEM) system, because it is a type of audit testing that directly examines the accuracy, completeness, and reliability of the data and transactions recorded in the logs. Substantive testing can involve various methods, such as re-performance, inspection, observation, inquiry, or computer-assisted audit techniques (CAATs), to verify the existence, occurrence, valuation, ownership, presentation, and disclosure of the log data1. Substantive testing canalso detect any errors, omissions, alterations, or manipulations of the log data that may indicate fraud or misstatement2.

Compliance testing (A) is not the best evidence of the validity and integrity of logs in an organization’s SIEM system, because it is a type of audit testing that evaluates the design and effectiveness of the internal controls that are implemented to ensure compliance with laws, regulations, policies, and procedures. Compliance testing can involve various methods, such as walkthroughs, questionnaires, checklists, or flowcharts, to assess the adequacy, consistency, and operation of the internal controls1. Compliance testing can provide assurance that the log data are generated and processed in accordance with the established rules and standards, but it does not directly verify the accuracy and reliability of the log data itself2.

Stop-or-go sampling (B) is not a type of audit testing, but a type of sampling technique that auditors use to select a sample from a population for testing. Stop-or-go sampling is a sequential sampling technique that allows auditors to stop testing before reaching the predetermined sample size if the results are satisfactory or conclusive. Stop-or-go sampling can reduce the audit cost and time by avoiding unnecessary testing, but it can also increase the sampling risk and uncertainty by relying on a smaller sample3. Stop-or-go sampling does not provide any evidence of the validity and integrity of logs in an organization’s SIEM system by itself; it depends on the type and quality of the audit tests performed on the selected sample.

Variable sampling (D) is not a type of audit testing, but a type of sampling technique that auditors use to estimate a numerical characteristic of a population for testing. Variable sampling is a statistical sampling technique that allows auditors to measure the amount or rate of error or deviation in a population by using quantitative methods. Variable sampling can provide precise and objective resultsby using mathematical formulas and confidence intervals4. Variable sampling does not provide any evidence of the validity and integrity of logs in an organization’s SIEM system by itself; it depends on the type and quality of the audit tests performed on the selected sample.

References:

Audit Testing Procedures - 5 Types and Their Use Cases

5 Types of Testing Methods Used During Audit Procedures | I.S. Partners

Stop-or-Go Sampling Definition

Variable Sampling Definition

The best method for maintaining the security of corporate applications pushed to employee-owned mobile devices is implementing mobile device management (MDM). MDM is a software solution that allows an organization to remotely manage, configure, and secure the mobile devices that access its network and data. MDM can help protect corporate applications on employee-owned devices by:

Enforcing security policies and settings, such as encryption, password, firewall, antivirus, and VPN.

Controlling the installation, update, and removal of corporate applications and data.

Separating corporate and personal data and applications on the device using containers or profiles.

Monitoring and auditing the device’s compliance status, activity, and location.

Performing remote actions, such as lock, wipe, backup, or restore, in case of loss, theft, or compromise.

MDM can provide a comprehensive and centralized approach to maintain the security of corporate applications on employee-owned devices, regardless of the device type, platform, or ownership. MDM can also help the organization comply with regulatory and industry standards for data protection and privacy.

Enabling remote data destruction capabilities is a useful feature for maintaining the security of corporate applications on employee-owned devices, but it is not the best method by itself. Remote data destruction allows the organization to erase the corporate data and applications from the device in case of loss, theft, or compromise. However, this feature does not prevent unauthorized access or misuse of the corporate data and applications before they are destroyed. Remote data destruction is usually part of an MDM solution.

Disabling unnecessary network connectivity options is a good practice for maintaining the security of corporate applications on employee-owned devices,but it is not the best method by itself. Network connectivity options, such as Wi-Fi, Bluetooth, NFC, or USB, can expose the device to potential attacks or data leakage. Disabling these options when they are not needed can reduce the attack surface and improve battery life. However, this practice does not address other security risks or requirements for the corporate applications on the device. Disabling network connectivity options can also be part of an MDM solution.

Requiring security awareness training for mobile users is an important measure for maintaining the security of corporate applications on employee-owned devices, but it is not the best method by itself. Security awareness training can educate the users about the potential threats and best practices for using their devices securely. It can also help foster a culture of security and responsibility among the users. However, security awareness training cannot guarantee that the users will follow the security policies and guidelines consistently and correctly. Security awareness training should be complemented by technical controls, such as MDM.

References:

Protecting Corporate Data on Mobile Devices for All Companies1

Mobile Device Security: Corporate-Owned Personally-Enabled (COPE)23

 A preventive control is a control that aims to deter or prevent undesirable events from occurring. A fingerprint-based access control system for the building is an example of a preventive control for physical access, as it restricts unauthorized persons from entering the premises. Keeping log entries for all visitors to the building, installing CCTV cameras for all ingress and egress points, and implementing a centralized logging server to record instances of staff logging into workstations are examples of detective controls, which are controls that aim to discover or detect undesirable events that have already occurred.

References: IS Audit and Assurance Tools and Techniques, CISA Certification | Certified Information Systems Auditor | ISACA

Before selecting a SaaS vendor, the most important action is to complete a risk assessment. A risk assessment is a process of identifying, analyzing, and evaluating the potential risks associated with outsourcing software and IT infrastructure to a third-party provider. A risk assessment helps to determine the impact and likelihood of various threats, such as data breaches, service disruptions, vendor lock-in, compliance issues, and legal disputes. A risk assessment also helps to identify the mitigation strategies and controls that can reduce or eliminate the risks.

A risk assessment is more important than determining service level requirements, performing a business impact analysis (BIA), or conducting a vendor audit because it provides the basis for these other actions. Service level requirements are the expectations and obligations that define the quality and quantity of service that the vendor must provide to the customer. A BIA is a process of assessing the potential effects of an interruption or disruption of critical business functions or processes due to an incident or disaster. A vendor audit is a process of verifying the vendor’s compliance with the contract terms, service levels, security policies, and best practices.

Service level requirements, BIA, and vendor audit are all important actions for selecting a SaaS vendor, but they depend on the results of the risk assessment. For example, service level requirements should reflect the risk appetite and tolerance of the customer, which are determined by the risk assessment. A BIA should prioritize the recovery of the most critical and vulnerable business functions or processes, which are identified by the risk assessment. A vendor audit should focus on the areas of highest risk and concern, which are highlighted by the risk assessment.

Therefore, an IS auditor should recommend to management that completing a risk assessment is the most important action before selecting a SaaS vendor.

References:

SaaS checklist: Nine factors to consider when selecting a vendor

SaaS vendor management: 10 best practices to achieve success

Best Practices for Software SaaS Vendor Selection and Negotiation

How to Evaluate SaaS Providers and Solutions by Developing … - Gartner

The most important part of a feasibility study is the economics1. A cost-benefit analysis of available products is crucial as it helps to understand the economic viability of the project1. It compares the costs of the project with the benefits it is expected to deliver, which is essential for making informed decisions1. Omitting this could lead to investments in hardware that may not provide the expected returns or meet the organization’s needs.

References:

The Components of a Feasibility Study - ProjectEngineer

When operational management informs the IS auditor that recent organizational changes have addressed previously identified risks and implementing the action plan is no longer necessary, the IS auditor should accept management’s assertion and report that the risks have been addressed. However, it is essential to document this communication and ensure that there is evidence supporting management’s claim. If there are any doubts or concerns, further investigation may be necessary. The auditor should not assume new risks without proper assessment or evidence1. References: 1(https://www.isaca.org/resources/isaca-journal/issues/2016/volume-6/enhancing-the-audit-follow-up-process-using-cobit-5)

Transaction tagging is a technique by which transactions are marked with unique identifiers or headers and traced through the system using agents or sensors at each processing point1. Transaction tagging allows for continuous monitoring and analysis of transaction processing in a high-volume, real-time system by providing visibility into the performance, availability, and reliability of each transaction and its components1. Transaction tagging can also help to identify and isolate errors, bottlenecks, anomalies, and security issues in the system1.

Data classification is the process of tagging data according to its type, sensitivity, and value to the organization. Data transformation is the process of changing the structure and format of data to make it usable for analysis and visualization. Both processes are important for data security and compliance, but they also pose some challenges.

One of the challenges is to ensure that the organization’s data classification policies are preserved during the process of data transformation. This means that the data should retain its original classification level and labels after it is transformed, and that the appropriate controls and protections are applied to the transformed data.

The best way to ensure this is to implement classification labels in metadata during data creation (D). Metadata is data that describes other data, such as its source, format, content, and context. By adding classification labels to metadata, the data can be easily identified and tracked throughout its lifecycle, including during data transformation. The labels can also help enforce the proper access rights and encryption standards for the data, regardless of its state or location.

The correct answer is C. Software escrow agreement. A software escrow agreement is a legal arrangement between three parties: the software developer (licensor), the end-user (licensee), and an escrow agent. The agreement ensures that the software’s source code and other relevant assets are securely stored with the escrow agent, and can be released to the licensee under certain conditions, such as the licensor’s bankruptcy, insolvency, or failure to provide support or maintenance1. A software escrow agreement can provide the licensee with assurance and continuity for the software they depend on, and protect them from losing access or functionality in case of any unforeseen events or disputes with the licensor1.

The primary reason an IS auditor should discuss observations with management before delivering a final report is A. Validate the audit observations. This is because discussing the observations with management can help the auditor to ensure that the findings are accurate, complete, and supported by sufficient evidence1. It can also help the auditor to obtain management’s perspective and feedback on the issues and risks identified, and to avoid any misunderstandings or surprises when the final report is issued2.

The primary basis on which audit objectives are established is the consideration of risks12. This involves identifying and assessing the risks that could prevent the organization from achieving its objectives12. The audit objectives are then designed to address these risks and provide assurance that the organization’s controls are effective in managing them12. While audit risk, assessment of prior audits, and business strategy are important factors in the audit process, they are secondary to the fundamental requirement of considering risks12.

References:

Objectives of Auditing - Primary and Secondary Objectives of Auditing | Auditing Management Notes

Audit Objectives | Primary and Subsidiary Audit Objectives - EDUCBA

The issue seems to stem from a breakdown in the workflow or process for handling assets that are due for destruction12. By examining the workflow, the IS auditor can identify where the process failed, such as why the vendor was not notified about the hard drives12. This could involve reviewing procedures for inventory management, communication with vendors, and tracking of assets due for destruction12. The findings can then be used to improve the workflow and prevent similar issues in the future12.

References:

How To Properly Destroy A Hard Drive - Tech News Today

How to safely and securely destroy hard disk data - iFixit

A risk and control framework is a set of principles, processes, and tools that guide an organization in identifying, assessing, managing, and monitoring the risks and controls that affect its objectives and performance. A risk and control framework helps an organization to align its risk appetite and tolerance with its strategy, culture, and values, and to ensure that its security controls are appropriate, effective, and efficient1.

Re-evaluating the organization’s risk and control framework is the best recommendation to management because it can help them to:

Review the current risk environment and the sources, causes, and impacts of potential threats and vulnerabilities.

Update the risk assessment and analysis methods and criteria, such as likelihood, impact, severity, and priority.

Reconsider the risk response and treatment options, such as avoidance, reduction, transfer, or acceptance.

Realign the security controls with the risk profile and the business needs and expectations.

Evaluate the performance and effectiveness of the security controls using key indicators and metrics.

Identify the gaps, weaknesses, or inefficiencies in the security controls and implement corrective or improvement actions.

Communicate and report the risk and control status and results to relevant stakeholders.

Re-evaluating the organization’s risk and control framework can help management to determine whether the current security controls are excessive or not, and to make informed and rational decisions on how to adjust them accordingly.

 IT governance should be driven by organizational strategies. It provides a formal structure for organizations to produce measurable results toward achieving their strategies and ensures that IT investments support business objectives12. While business unit initiatives, balanced scorecards, and policies and standards can play a role in IT governance, they are tools or methods that support the implementation of the organizational strategies.

The primary objective of a control self-assessment (CSA) is to educate functional areas on risks and controls. CSA is a technique that allows managers and work teams directly involved in business units, functions or processes to participate in assessing the organization’s risk management and control processes1. CSA can help functional areas to obtain a clear and shared understanding of their major activities and objectives, to foster an improved awareness of risk and controls among management and staff, to enhance responsibility and accountability for risks and controls, and to highlight best practices and opportunities to improve business performance2.

The other options are not the primary objective of a CSA. Ensuring appropriate access controls are implemented is a specific type of control that may be assessed by a CSA, but it is not the main goal of the technique. Eliminating the audit risk by leveraging management’s analysis is not a realistic or desirable outcome of a CSA, as audit risk can never be completely eliminated, and management’s analysis may not be sufficient or reliable without independent verification. Gaining assurance for business functions that cannot be audited is not a valid reason for conducting a CSA, as all business functions should be subject to audit, and a CSA is not a substitute for an audit.

References:

Control Self Assessments - PwC

Control self-assessment - Wikipedia

Control Self Assessment - AuditNet

The role of a document owner when implementing a data classification policy in an organization is to classify documents to correctly reflect the level of sensitivity of information they contain. A document owner is the person who is ultimately responsible for the creation, maintenance, and protection of a document, usually a member of senior management or a business unit1. A data classification policy is a plan that defines how the organization categorizesits data based on its value, risk, and regulatory requirements, and how it handles and secures each data category2.

According to the data classification policy template by Netwrix3, one of the roles and responsibilities of the document owner is to assign data classification labels based on the data’s potential impact level. Data classification labels are tags or markings that indicate the sensitivity level of the data, such as public, internal, confidential, or restricted. The document owner should apply the data classification labels to the documents that contain the data, either manually or automatically, using tools and methods such as metadata, watermarks, headers, footers, or encryption. The document owner should also review and update the data classification labels periodically or whenever there is a change in the data’s sensitivity level.

By classifying documents to correctly reflect the level of sensitivity of information they contain, the document owner can help to ensure that the documents are handled in accordance with the data classification policy. This means that the documents are stored, accessed, shared, transmitted, anddisposed of in a secure and appropriate manner, based on the rules and controls defined for each data category. This can also help to prevent data loss, leakage, or breach incidents that may cause harm or damage to the organization or its stakeholders.

Therefore, option A is the correct answer.

References:

Data Classification Policy: Definition, Examples, & Free Template2

Data Classification Policy Template - Netwrix3

Data Classification and Handling Policy - University of Hull1

An acceptable use policy (AUP) is a preventive control that sets out rules and guidelines for using an organization’s IT resources, including networks, devices, and software1. It defines acceptable and prohibited behaviors, aiming to protect assets, ensure security, and maintain a productive work environment1. By agreeing to and documenting an AUP for the equipment, both organizations can prevent potential misuse of IT resources2345.

References:

ISO 27001 Acceptable Use Policy Beginner’s Guide - High Table

Acceptable Use Policy for Information Technology Resources

Acceptable Use Policies for Workplace Technology | Verizon

IT Governance: Your Must-Have Policies - How-To Geek

Acceptable use policy template - Workable

The most helpful thing for an IS auditor to review when evaluating an organization’s business processes that are supported by applications and IT systems is the enterprise architecture (EA). EA is the practice of designing a business with a holistic view, considering all of its parts and how they interact. EA defines the overall goals, the strategies that support those goals, and the tactics that are needed to execute those strategies. EA also outlines the ways various components of IT projects interact with one another and with the business processes. By reviewing the EA, an IS auditor can gain a comprehensive understanding of how the organization aligns its IT efforts with its overall mission, business strategy, and priorities. An IS auditor can also assess the effectiveness, efficiency, agility, and continuity of complex business operations.

The other options are not as helpful as option B. A configuration management database (CMDB) is a database that stores and manages information about the components that make up an IT system. A CMDB tracks individual configuration items (CIs), such as hardware, software, or data assets, and their attributes, dependencies, and changes over time. A CMDB can help an IS auditor to monitor the performance, availability, and configuration of IT assets, but it does not provide a holistic view of how they support the business processes. IT portfolio management is the practice of managing IT investments, projects, and activities as a portfolio. IT portfolio management aims to optimize the value, risk, and cost of IT initiatives and align them with the business objectives. IT portfolio management can help an IS auditor to evaluate the return on IT investments and the alignment of IT projects with the business strategy, but it does not provide a detailed view of how they support the business processes. IT service management (ITSM) is the practice of planning, implementing, managing, and optimizing IT services to meet the needs of end users and customers. ITSM focuses on delivering IT as a service using standardized processes and best practices. ITSM can help an IS auditor to review the quality, efficiency, and effectiveness of IT service delivery and support, but it does not provide a comprehensive view of how they support the business processes. References: What is enterprise architecture (EA)? - RingCentral, What is a configuration management database (CMDB)? - Red Hat, IT Portfolio Management Strategies | Smartsheet, What is IT service management (ITSM)? | IBM

A virtual tape library (VTL) is a disk-based backup system that emulates a tape library. It provides faster backup and recovery than traditional tape systems, and it can be integrated with data deduplication and replication technologies to enhance disaster recovery. A VTL can also be replicated to an offsite location for additional protection. A VTL is the best disaster recovery solution for an environment where data virtualization is used, because it can handle large volumes of data, support multiple backup applications, and provide consistent performance.

Onsite disk-based backup systems (A) are not the best disaster recovery solution, because they are vulnerable to the same risks as the primary data center, such as fire, flood, power outage, or sabotage. Tape-based backup systems (B) are not the best disaster recovery solution, because they are slow, prone to errors, and require manual intervention. Redundant array of independent disks (RAID) (D) is not a backup system, but a storage technology that improves performance and fault tolerance by distributing data across multiple disks. RAID does not protect against data corruption, human error, or malicious attacks.

References:

Virtualization Disaster Recovery Overview: Definitions and Guides

Disaster Recovery Virtualization - VMware

What is Virtual Disaster Recovery? - Definition from Techopedia

How Does Virtualization Help With A Disaster Recovery Plan

 A heuristic intrusion detection system (IDS) provides the most protection against emerging threats, as it uses behavioral analysis and anomaly detection to identify unknown or zero-day attacks. A heuristic IDS can adapt to changing patterns and learn from previous incidents, making it more effective than a signature-based IDS, which relies on predefined rules and signatures to detect known attacks. A demilitarized zone (DMZ) is a network segment that separates the internal network from the external network, and it can provide some protection against external threats, but not against internal or emerging threats. Real-time updating of antivirus software is important to protect against malware, but it may not be sufficient to prevent new or sophisticated attacks that exploit unknown vulnerabilities. References: CISA Review Manual (Digital Version) 1, page 452-453.

The type of review that is most important to conduct when an IS auditor is informed that a recent internal exploitation of a bug has been discovered in a business application is C. Forensic audit. A forensic audit is a type ofaudit that involves collecting, analyzing, and preserving evidence of fraud, corruption, or other illegal or unethical activities1. A forensic audit can help the IS auditor to identify and document the source, scope, and impact of the exploitation, as well as the perpetrators, motives, and methods involved. A forensic audit can also help the IS auditor to provide recommendations for preventing or mitigating future exploitations, and to support any legal actions or investigations that may arise from the incident2.

The most important action before the audit work begins is to establish control objectives. Control objectives are the specific goals or outcomes that the audit intends to achieve or verify in relation to the information protection in the application1. Control objectives provide the basis for designing and performing the audit procedures, evaluating the audit evidence, and reporting the audit findings and recommendations2. Control objectives also help to align the audit scope and criteria with the business needs and expectations, and to ensure that the audit is relevant, reliable, and efficient3.

Some examples of control objectives for an information protection audit are:

To ensure that the information stored in the application is classified according to its sensitivity, value, and regulatory requirements

To ensure that the information stored in the application is encrypted, masked, or anonymized as appropriate

To ensure that the information stored in the application is accessible only by authorized users and processes

To ensure that the information stored in the application is backed up, restored, and retained according to the business continuity and retention policies

To ensure that the information stored in the application is monitored, logged, and audited for any unauthorized or anomalous activities

Therefore, option B is the correct answer.

Option A is not correct because reviewing remediation reports is not the most important action before the audit work begins. Remediation reports are documents that describe how previous audit findings or issues have been resolved or addressed by the auditee4. While reviewing remediation reports may be useful for understanding the current state of information protection in the application, it is not a prerequisite for defining the control objectives of the audit.

Option C is not correct because assessing the threat landscape is not the most important action before the audit work begins. The threat landscape is the set of potential sources, methods, and impacts of cyberattacks or data breaches that may affect the information stored in the application5. While assessing the threat landscape may be helpful for identifying and prioritizing the risks and vulnerabilities of information protection in the application, it is not a prerequisite for defining the control objectives of the audit.

Option D is not correct because performing penetration testing is not the most important action before the audit work begins. Penetration testing is a technique that simulates real-world cyberattacks or data breaches to test the security and resilience of information systems or applications. 

The most significant benefit of implementing a control self-assessment (CSA) program and leveraging the internal audit function to test its internal controls annually is that risks are detected earlier. A CSA program is a process that enables business owners and managers to assess and improve their own internal controls on a regular basis, without relying on external auditors or consultants. A CSA program can help identify and mitigate risks, enhance performance, increase accountability, and foster a culture of control within the organization. By leveraging the internal audit function to test its internal controls annually, a small business unit can also obtain independent assurance and validation of its CSA results, as well as recommendations for improvement. This approach can help reduce compliance costs, as external audits may be less frequent or extensive. However, this is not the most significant benefit, as compliance costs are only one aspect of the total cost of risk. Business owners can also focus more on their core roles, as they can delegate some of their control responsibilities to their staff or teams through CSA. However, this is not the most significant benefit, as business owners still need to oversee and monitor their CSA activities and results, and ensure that they align with their strategic objectives and priorities. Line management may also be more motivated to avoid control exceptions, as they are directly involved in assessing and improving their own controls through CSA. However, this is not the most significant benefit, as motivation alone may not be sufficient to ensure effective control design and operation. References: Info Technology & Systems Resources | COBIT, Risk, Governance … - ISACA, IT Governance and Process Maturity

 File checksums are values that are calculated from the contents of a file and can detect any changes or corruption in the file. They are used to verify that the files that are transferred or processed through system interfaces are not altered in any way. File checksums are more effective than periodic audits, file counts, or IT operator monitoring, which are other types of controls that can help ensure the integrity of system interfaces, but they are not as reliable or timely as file checksums.

Sending a copy of the transaction logs to offsite storage on a daily basis would minimize the risk of losing transactions as a result of a disaster. This is because offsite storage provides a backup of the data that can be recovered in case of a catastrophic event that destroys or damages the onsite data. Storing a copy of the transaction logs onsite in a fireproof vault (B) would not protect the data from other types of disasters, such as floods, earthquakes, or theft. Encrypting © or signing (D) a copy of the transaction logs and storing them on a local server would not prevent the loss of data if the server is affected by the disaster. Encryption and digital signatures are security measures that protect the confidentiality and integrity of the data, but not the availability.

This is because the business processes are the core activities and functions that enable the organization to achieve its objectives and create value for its stakeholders. The business processes are also the sources and drivers of various risks that may affect the organization’s performance, compliance, and reputation. Therefore, the IS auditor should focus on understanding, assessing, and prioritizing thebusiness processes that are most critical, complex, or vulnerable to the organization’s success, and align the audit objectives, scope, and resources accordingly12.

Critical business applications (A) are not the most important area of focus for an IS auditor when developing a risk-based audit strategy, but rather a specific aspect of the business processes that may require attention. Critical business applications are the software systems that support the execution and automation of the business processes, such as enterprise resource planning (ERP), customer relationship management (CRM), or accounting systems. Critical business applications may pose significant risks to the organization if they are not reliable, secure, or efficient. Therefore, the IS auditor should consider the criticality, functionality, and dependency of the business applications when planning the audit, but not as the primary focus12.

Existing IT controls © are not the most important area of focus for an IS auditor when developing a risk-based audit strategy, but rather an outcome or output of the risk assessment process. Existing IT controls are the policies, procedures, practices, and technologies that are implemented to manage and mitigate the IT-related risks that may affect the organization’s business processes and objectives. Existing IT controls may vary in their design, effectiveness, and maturity. Therefore, the IS auditor should evaluate and testthe existing IT controls as part of the audit execution and reporting process, but not as the main focus12.

Recent audit results (D) are not the most important area of focus for an IS auditor when developing a risk-based audit strategy, but rather an input or source of information for the risk assessment process. Recent audit results are the findings, recommendations, and opinions of previous audits that may provide insights or feedback on the organization’s business processes, risks, and controls. Recent audit results may also indicate any changes or trends in the organization’s risk profile or environment. Therefore, the IS auditor should review and consider the recent audit results as part of the audit planning and scoping process, but not as the main focus12.

A project deliverable is a tangible or intangible product or service that is produced as a result of a project and delivered to the customer or stakeholder. A project deliverable can be either an intermediate deliverable that is part of the project process or a final deliverable that is the outcome of the project.

An agile software development methodology is a project management approach that involves breaking the project into phases and emphasizes continuous collaboration and improvement. Teams follow a cycle of planning, executing, and evaluating. Agile software development methodologies value working software over comprehensive documentation and respond to change over following a plan.

Rapidly created working prototypes are most likely to be a project deliverable of an agile software development methodology because they:

Provide early and frequent feedback from customers and stakeholders on the functionality and usability of the software product

Allow for rapid validation and verification of the software requirements and design

Enable continuous improvement and adaptation of the software product based on changing customer needs and expectations

Reduce the risk of delivering a software product that does not meet customer needs or expectations

Increase customer satisfaction and trust by delivering working software products frequently and consistently

Some examples of agile software development methodologies that use rapidly created working prototypes as project deliverables are:

Scrum - a framework that organizes the work into fixed-length sprints (usually 2-4 weeks) and delivers potentially shippable increments of the software product at the end of each sprint1

Extreme Programming (XP) - a methodology that focuses on delivering high-quality software products through practices such as test-driven development, pair programming, continuous integration, and frequent releases2

Rapid Application Development (RAD) - a methodology that emphasizes rapid prototyping and user involvement throughout the software development process3

The other options are not likely to be project deliverables of an agile software development methodology.

Strictly managed software requirements baselines are not likely to be project deliverables of an agile software development methodology. A software requirements baseline is a set of agreed-upon and approved software requirements that serve as the basis for the software design, development, testing, and delivery. A strictly managed software requirements baseline is a software requirements baseline that is controlled and changed only through a formalchange management process. Strictly managed software requirements baselines are more suitable for traditional or waterfall software development methodologies that follow a linear and sequential process of defining, designing, developing, testing, and delivering software products. Strictly managed software requirements baselines are not compatible with agile software development methodologies that embrace change and flexibility in the software requirements based on customer feedback and evolving needs.

Extensive project documentation is not likely to be project deliverables of an agile software development methodology. Project documentation is any written or electronic information that describes or records the activities, processes, results, or decisions of a project. Extensive project documentation is project documentation that covers every aspect of the project in detail and requires significant time and effort to produce and maintain. Extensive project documentation is more suitable for traditional or waterfall software development methodologies that rely on comprehensive documentation to communicate and document the project scope, requirements, design, testing, anddelivery. Extensive project documentation is not compatible with agile software development methodologies that value working software over comprehensive documentation and use minimal documentation to support the communication and collaboration among the project team members.

Automated software programming routines are not likely to be project deliverables of an agile software development methodology. Automated software programming routines are programs or scripts that perform repetitive or complex tasks in the software development process without human intervention. Automated software programming routines can improve the efficiency, quality, and consistency of the software development process by reducing human errors, saving time, and enforcing standards. Automated software programming routines can be used in any software development methodology, but they are not specific to agile software development methodologies. Automated software programming routines are not considered as project deliverables because they are not part of the final product that is delivered to the customer.

A post-implementation change review is the best compensating control against segregation of duties conflicts in new code development. This process involves a thorough review of the changes after they have been implemented to ensure that they meet their objectives and that the stakeholders are satisfied with the results1. It provides an opportunity to identify and correct any issues or conflicts that may have arisen during the development and implementation process. While other options like adding developers to the change approval board, limiting code deployment access to a small number of people, and creating staging environments can also serve as compensating controls, a post-implementation change review provides a more comprehensive and effective control mechanism21.

References:

Review and Close Change process ST 2 5 - Micro Focus

Change Management for SOC: Risks, Controls, Audits, Guidance

 A contingency facility is a backup site that can be used to resume business operations in the event of a disaster or disruption at the primary site. The most important consideration for a contingency facility is that it is located a sufficient distance away from the primary site, so that it is not affected by the same event that caused the disruption. For example, if the primary site is damaged by a fire, flood, earthquake, or terrorist attack, the contingency facility should be in a different geographic area that is unlikely to experience the same hazard. This way, the organization can continue to provide its services and products to its customers and stakeholders without interruption.

The other options are not as important as the location of the contingency facility. The badge access controls, the number of business assets, and the identifiability of the sites are secondary factors that may affect the security and efficiency of the contingency facility, but they are not essential for its functionality. Therefore, option C is the correct answer.

References:

The Importance of Contingency Planning

WHO guidance for contingency planning

The greatest concern with finding closed-circuit television (CCTV) systems located in a patient care area is that there are no notices indicating recording is in progress. This is because CCTV systems in healthcare settings can pose a threat to the privacy and confidentiality of patients, staff, and visitors, especially in sensitive areas where personal or medical information may be exposed. According to the government’s Surveillance camera code of practice1, CCTV operators must be as transparent as possible in the use of CCTV, and inform people that they are being recorded by using clear and visible signs. The signs should also provide contact details of the CCTV operator and the purpose of the surveillance. By providing notices, CCTV operators can comply with data protection law and respect the rights and expectations of individuals.

Option B is correct because the lack of notices indicating recording is in progress is a clear violation of the Surveillance camera code of practice1, which applies to local authorities and the police, and is encouraged to be adopted by other CCTV operators in England and Wales. The code also applies to Scotland, along with the National Strategy for Public Space CCTV2. The code is intended to be used in conjunction with the guidance provided by the Information Commissioner’s Office (ICO)3, which applies across the UK. The ICO states that CCTV operators must inform people that they are being recorded by using prominent signs at the entrance of the CCTV zone and reinforcing this with further signs inside the area.

Option A is incorrect because cameras not being monitored 24/7 is not the greatest concern, as it does not necessarily affect the privacy and confidentiality of individuals. CCTV systems may have different purposes and objectives, such as deterring or monitoring crime, enhancing security, or improving patient care. Depending on the purpose, CCTV systems may not require constant monitoring, but rather periodic review or analysis. However, CCTV operators should still ensure that they have adequate security measures to protect the CCTV systems from unauthorized access or tampering.

Option C is incorrect because the retention period for video recordings being undefined is not the greatest concern, as it does not directly affect the privacy and confidentiality of individuals. However, CCTV operators should still define and document their retention policy, and ensure that they do not keep video recordings for longer than necessary, unless they are needed for a specific purpose or as evidence. The retention period should be based on a clear and justifiable rationale, and comply with data protection law and industry guidelines.

Option D is incorrect because there being no backups of the videos is not the greatest concern, as it does not affect the privacy and confidentiality of individuals. However, CCTV operators should still consider having backups of their videos, especially if they are needed for a specific purpose or as evidence. Backups can help to prevent data loss or corruption due to system failures, disasters, or malicious attacks. Backups should also be stored securely and encrypted to prevent unauthorized access or disclosure.

The sampling method in which the entire sample is considered to be irregular if a single error is found is discovery sampling. Discovery sampling is a type of statistical sampling that is used to test for the existence of at least one occurrence of a specific characteristic or condition in a population. Discovery sampling is often used when the auditor expects the characteristic or condition to be very rare or nonexistent, and when any occurrence would have a significant impact on the audit objective. For example, discovery sampling can be used to test for fraud, noncompliance, or material misstatement.

Discovery sampling works by setting a very low tolerable error rate (the maximum rate of occurrence of the characteristic or condition that the auditor is willing to accept) and a high confidence level (the degree of assurance that the auditor wants to obtain). The auditor then selects a sample from the population using a random or systematic method, and examines each item in the sample for the presence or absence of the characteristic or condition. If no error is found in the sample, the auditor can conclude with a high level of confidence that the characteristic or condition does not exist or is veryrare in the population. However, if one or more errors are found in the sample, the auditor cannot draw any conclusion about the population and must either expand the sample size or perform alternative procedures.

Discovery sampling differs from other sampling methods in that it does not allow for any errors in the sample. Other sampling methods, such as variable sampling, stop-or-go sampling, or judgmental sampling, can tolerate some errors in the sample and use them to estimate the error rate or amount in the population. However, discovery sampling is designed to test for zero-tolerance situations, where any error would be unacceptable or material. Therefore, discovery sampling considers the entire sample to be irregular if a single error is found.

References:

Audit Sampling - Overview, Purpose, Importance, and Types1

Audit Sampling - What Is It, Methods, Example, Advantage, Reason2

ISA 530: Audit sampling | ICAEW3

Audit Sampling - AICPA4

 The greatest concern to an IS auditor reviewing an organization’s method to transport sensitive data between offices is that the method relies exclusively on the use of asymmetric encryption algorithms. Asymmetric encryption algorithms, also known as public key encryption, use two different keys for encryption and decryption: a public key that is shared with anyone who wants to communicate with the sender, and a private key that is kept secret by the sender. Asymmetric encryption algorithms are more secure than symmetric encryption algorithms, which use the same key for both encryption and decryption, but they are also slower and more computationally intensive. Therefore, relying exclusively on asymmetric encryption algorithms may not be efficient or practical for transporting large amounts of sensitive data between offices. A better method would be to use a combination of symmetric and asymmetric encryption algorithms, such as using asymmetric encryption to exchange a symmetric key and then using symmetric encryption to encrypt and decrypt the data.

The other options are not as concerning as option C. The method relying exclusively on the use of public key infrastructure (PKI) is not a concern, because PKI is a system that provides the services and mechanisms for creating, managing, distributing, using, storing, and revoking digital certificates that are based on asymmetric encryption algorithms. PKI enables secure and authenticated communication between parties who do not have a prior trust relationship. The method relying exclusively on the use of digital signatures is not a concern, because digital signatures are a way of verifying the authenticity and integrity of a message or document by using asymmetric encryption algorithms. Digital signatures ensure that the sender cannot deny sending the message or document, and that the receiver can detect any tampering or alteration of the message or document. The method relying exclusively on the use of128-bit encryption is not a concern, because 128-bit encryption is a level of encryption that uses a 128-bit key to encrypt and decrypt data. 128-bit encryption is considered to be strong enough to resist brute-force attacks by modern computers. References: Asymmetric vs Symmetric Encryption: What are differences?, Public Key Infrastructure (PKI), Digital Signature, What is 128-bit Encryption?

If the audit team lacks the necessary knowledge to audit a system that uses an AI algorithm, engaging external consultants who have audit experience and knowledge of AI would be the best approach12. These consultants can provide the expertise needed to effectively audit the AI system12. This approach ensures that the audit is conducted thoroughly and accurately, without requiring the audit team to acquire new skills or knowledge12.

References:

Auditing Guidelines for Artificial Intelligence - ISACA

An In-Depth Guide To Audit AI Models - Censius

 Audit observations are the findings and recommendations that result from an audit engagement. Audit observations should be first communicated with the auditee during fieldwork, which is the stage of the audit process where the auditor collects and analyzes evidence to evaluate the audit objectives1. Communicating audit observations during fieldwork has several benefits, such as2:

It allows the auditor to verify the accuracy and completeness of the observations, and to obtain additional information or clarification from the auditee if needed.

It enables the auditor to discuss the root causes, impacts, and risks of the observations, and to solicit the auditee’s input on possible corrective actions and implementation timelines.

It helps to build rapport and trust between the auditor and the auditee, and to avoid surprises or disagreements at the end of the audit.

It facilitates timely resolution of audit observations, and reduces the risk of audit delays or disputes.

Therefore, option B is the correct answer.

Option A is not correct because communicating audit observations when drafting the report is too late, as it may lead to misunderstandings, conflicts, or revisions that could have been avoided if theobservations were communicated earlier. Option C is not correct because communicating audit observations at the end of fieldwork is also not ideal, as it may not leave enough time for the auditor and the auditee to discuss and agree on the observations and recommendations. Option D is not correct because communicating audit observations within the audit report is the final step of the audit process, not the first.

References:

Audit Process Overview1

Communicating Internal Audit Findings: Best Practices for Success2

 An organization considering the outsourcing of a business application should first conduct a cost-benefit analysis to evaluate the feasibility, viability and desirability of the outsourcing decision. A cost-benefit analysis should compare the costs and benefits of outsourcing versus keeping the application in-house, taking into account factors such as financial, operational, strategic, legal, regulatory, security and quality aspects. A cost-benefit analysis should also identify the risks and opportunities associated with outsourcing, and provide a basis for defining the service level requirements, performing a vulnerability assessment, and issuing a request for proposal (RFP) in the subsequent stages of the outsourcing process. References: Info Technology &Systems Resources | COBIT, Risk, Governance … - ISACA, CISACertification | Certified Information Systems Auditor | ISACA

The greatest concern when reviewing an IT strategic plan is B. The plan does not support relevant organizational goals. This is because an IT strategic plan should align and integrate the IT goals and objectives with the organization’s overall strategy and vision, and ensure that IT supports and enables the business processes and functions1. If the IT strategic plan does not support relevant organizational goals, it may lead to:

Suboptimal or negative outcomes and value for the organization, as IT investments and initiatives may not align with the organization’s priorities, needs, or expectations1.

Conflicts or inconsistencies between IT and business functions, as IT may not deliver the expected level of service, quality, or performance2.

Wasted or inefficient use of resources, as IT may spend time, money, or effort on projects or activities that are not relevant or beneficial for the organization2.

A benefits realization process is a systematic way of identifying, defining, planning, tracking and realizing the benefits from a project or program. Benefits are the measurable improvements that result from the delivery of project outputs and outcomes. Benefits realization management (BRM) is the practice of ensuring that benefits are derived from outputs and outcomes.

One of the best practices for BRM is to select metrics for the project before it begins. Metrics are the indicators that measure the performance and value of the project and its benefits. By selecting metrics in advance, the project team can align the project objectives with the expected benefits, establish a baseline for comparison, and monitor and evaluate the progress and results of the project. Metrics also help to communicate the value of the project to stakeholders and justify the investment.

The other options are not as effective as selecting metrics before the project begins. Project budget is an important factor for BRM, but it does not enable the benefits realization process by itself. It only reflects the costs of executing the project and delivering the solution, not the benefits or value that are expected from them. Estimates of business benefits are useful for planning and forecasting, but they are not sufficient for BRM. They need to be validated by actual data and evidence from similar projects or other sources. Metrics are evaluated after the project has been implemented, but this is only one part of the benefits realization process. BRM requires continuous monitoring and evaluation throughout the project life cycle and beyond, to ensure that benefits are sustained and optimized.

References:

ISACA, CISA Review Manual, 27th Edition, 2019, p. 3261

PMI, Benefits Realization Management: A Practice Guide, 20192

APM, What is benefits management and project success?, 20213

The third-party contract has not been reviewed by the legal department is the auditor’s greatest concern because it poses a significant legal and financial risk to the client. A third-party contract is a legally binding agreement between the client and the outsourced payroll provider that defines the scope, terms, and conditions of the service. A third-party contract should be reviewed by the legal department to ensure that it complies with the applicable laws and regulations, protects the client’s interests and rights, and specifies the roles and responsibilities of both parties. A third-party contract that has not been reviewed by the legal department may contain clauses that are unfavorable, ambiguous, or contradictory to the client, such as:

Inadequate or unclear service level agreements (SLAs) that do not specify the quality, timeliness, and accuracy of the payroll service.

Insufficient or vague security and confidentiality provisions that do not safeguard the client’s data and information from unauthorized access, use, disclosure, or loss.

Unreasonable or excessive fees, penalties, or liabilities that may impose an undue financial burden on the client.

Limited or no audit rights that may prevent the client from verifying the effectiveness and compliance of the payroll provider’s internal controls.

Inflexible or restrictive termination clauses that may limit the client’s ability to cancel or switch to another payroll provider.

A third-party contract that has not been reviewed by the legal department may expose the client to various risks, such as:

Legal disputes or litigation with the payroll provider over contractual breaches or performance issues.

Regulatory fines or sanctions for noncompliance with tax, labor, or other laws and regulations related to payroll.

Financial losses or damages due to errors, fraud, or negligence by the payroll provider.

Reputation damage or customer dissatisfaction due to payroll errors or delays.

Therefore, an IS auditor should be highly concerned about a third-party contract that has not been reviewed by the legal department and recommend that the client seek legal advice before signing or renewing any contract with an outsourced payroll provider.

User access rights have not been periodically reviewed by the client is a moderate concern because it may indicate a lack of proper access control over the payroll system. User access rights are the permissions granted to users to access, view, modify, or delete data and information in the payroll system. User access rights should be periodically reviewed by the client to ensure that they are aligned with the user’s roles and responsibilities, and that they are revoked or modified when a user changes roles or leaves the organization. User access rights that are not periodically reviewed by the client may result in unauthorized or inappropriate access to payroll data and information, which may compromise its confidentiality, integrity, and availability.

Payroll processing costs have not been included in the IT budget is a minor concern because it may indicate a lack of proper planning and allocation of IT resources for payroll processing. Payroll processing costs are the expenses incurred by the client for using an outsourced payroll service, such as fees, charges, taxes, or penalties. Payroll processing costs should be included in the IT budget to ensure that they are adequately estimated, monitored, and controlled. Payroll processing costs that are not included in the IT budget may result in unexpected or excessive costs for payroll processing, which may affect the client’s profitability and cash flow.

The third-party contract does not comply with the vendor management policy is a low concern because it may indicate a lack of alignment between the client’s vendor management policy and its actual vendor selection and evaluation process. A vendor management policy is a set of guidelines and procedures that governs how the client manages its relationship with its vendors, such as how to select, monitor, evaluate, and terminate vendors. A vendor management policy should be consistent with the client’s business objectives, risk appetite, and regulatory requirements. A third-party contract that does not comply with the vendor management policy may result in suboptimal vendor performance or service quality, but it does not necessarily imply a breach of contract or a violation of law.

A data warehouse is a centralized repository of data that is collected from various sources and organized for analysis and reporting purposes. A data warehouse can help an organization gain insights into its business performance, trends, and opportunities. However, building a data warehouse requires careful planning, design, and implementation to ensure that it meets the needs of the organization.

One of the best practices that would provide management with the most reasonable assurance that a new data warehouse will meet the needs of the organization is A. Integrating data requirements into the system development life cycle (SDLC). The SDLC is a framework that defines the phases and activities involved in developing a software system, such as planning, analysis, design, testing, deployment, and maintenance1. By integrating data requirements into the SDLC, an organization can ensure that the data warehouse is aligned with the business objectives and expectations, and that it delivers value to the end users.

Some of the benefits of integrating data requirements into the SDLC are:

It helps to identify and prioritize the key business questions and metrics that the data warehouse should support2.

It helps to define and validate the data sources, models, structures, and quality standards that the data warehouse should follow3.

It helps to design and implement the data integration, transformation, and loading processes that the data warehouse should use4.

It helps to test and verify the functionality, performance, and accuracy of the data warehouse before deploying it to production.

It helps to monitor and maintain the data warehouse after deployment and incorporate feedback and changes as needed.

Discovery sampling is a type of statistical sampling that’s used when the expected error rate in the population is very low1. This method is designed to discover at least one instance of an attribute or condition in a population1. It’s often used in auditing to uncover fraud or noncompliance with rules and regulations1.

References:

What are sampling methods and how do you choose the best one?