Chapter 8 Data Structures and CAATs For Data Extraction PDF
Chapter 8 Data Structures and CAATs For Data Extraction PDF
1. Explain hashing structure works and why is it quicker than using an index. Give an example. If it
is so much faster, why isn’t it used exclusively?
Hash tables are used to quickly store and retrieve data (or records). Records are stored in
buckets using hash keys Hash keys are calculated by applying a hashing algorithm to a chosen
value contained within the record. This chosen value must be a common value to all the records.
Each bucket can have multiple records which are be organized in a particular order.
It is quicker than index since each key doesn’t have to be unique from the other.
For example, Let's say you have 200 objects, but only 15 of them have hash codes that begin
with the letter 'B.' The hash table would only need to look up and search through the 15 objects
in the 'B' bucket, rather than all 200 objects.
It may impair data efficiency that is why it is not used exclusively.
2. Explain how an embedded audit module works and why auditors may choose not to use it.
A predecessor technology to continuous audit is the Embedded Audit Module (EAM). These
challenges are analyzed by the development of ten examples of EAM alerts in a fraud
environment. The alerts employ stored database procedures and triggers to monitor the
internal control environment. The alerts are complementary to the strengthening of a firm's
internal control system by monitoring and reporting the irregularities in the control
environment.
Auditors may choose not to use it because of certain limitations of EAM. These limitations raise
a number of issues that must be considered before continuous audit can be widely adopted.
3. Explain the term navigational data models. Contrast the hierarchical model and the network
model.
Navigational data models have limits in their design for dynamic navigation and more work
should be done in the research of real time navigation data models. In the paper, it discusses
the content of real time navigation data and gets that the content mainly contains data of traffic
events and data of traffic flow. Both of them are different feature classes of real-time navigation
data based on ISO-GDF model.
Hierarchical model arranges data in relational chronological manner while network model
illustrates data in terms of connections and links.
4. Explain the three types of anomalies associated with database tables that have not been
normalized.
Update anomaly occurs when stored data may be impaired by data updates.
Deletion anomaly occurs when important files or stored data may be lost due to deletion of
some data
Insertion anomaly occurs when data may be impaired due to storing additional files and data.
EAM focuses on audit and assurance of stored data in standardized manner. GAS is flexible to
the user of data in the audit procedure of the client.
6. Describe a specific accounting application that could make use of an VSAM file
In recording a production under process costing in which each department processes a single
activity in batches.
7. Explain why auditors should be familiar with the principle of data normalization
Auditors should be familiar with the principle of data normalization since it is associated with
data anomalies that may impair data.
User view provides room for comment and qualitative evaluation. Database table is more on
quantitative data evaluation.
Third normal form (3NF) is a normal form used in database normalization. 3NF was originally
defined by E.F. Codd in 1971.[1] Codd's definition states that a table is in 3NF if and only if both
of the following conditions hold:
The relation R (table) is in second normal form (2NF)
Every non-prime attribute of R is non-transitively dependent (i.e. directly dependent) on every
super key of R.
10. Why is a separate link table required when an M:M association exits between related tables?
To prevent data anomalies, overwriting of data, and having a single data with multiple meaning.
11. In a relational database environment, certain accounting records may not exist. How is this
possible?
Lost records may not be relative to the data or lost records may have been overwritten when
updates of data are in process
12. Explain how to link tables in a 1:1 association. Why may this be different in a 1:0:1 association?
Two tables are related in a one-to-one (1—1) relationship if, for every row in the first table,
there is at most one row in the second table. True one-to-one relationships seldom occur in the
real world. This type of relationship is often created to get around some limitation of the
database management software rather than to model a real-world situation.
1:1 association assures a single pair relationship, in 1:0:1 association, one record may not have
any corresponding link at all.
13. Discuss the accounting implications of the update, insertion, and deletion anomalies associated
with improperly normalized tables.
Update anomaly occurs when stored data may be impaired by data updates.
Deletion anomaly occurs when important files or stored data may be lost due to deletion of
some data
Insertion anomaly occurs when data may be impaired due to storing additional files and data.
14. Give three examples that illustrate how cardinality reflects an organization’s underlying business
rules
There is M:M association between inventory and supplier entities. One or more vendors supply
each inventory items.
There is 1:0:M association between supplier and purchase order entities. Each supplier may
receive zero or one purchase order for the period.
The association between receiving and inventory entities is 0, M:M. each item of inventory
received may have been many times or never.
15. Explain the following three types of pointers: physical address pointer, relative address pointer,
and logical key pointer
Physical address pointer contains the value of absolute address in the next data record which is
to be accessed
Relative address pointer contains the value of relative address of the next data record which is
to be required
Logical key pointer contains the key field of record which helps to link the required next record
from the current record.
GAS technology is popular among auditors because auditors evaluate the reliability of computer
generated data supporting financial ... IT Auditor must know the characteristics of users of the
information system and ..... met in the most effective and efficient way - sufficient and adequate
disposal.
17. Explain the risk associated with using GAS to access complex file structures
Most common risk associated with GAS is the risk that data integrity will be compromised by the
procedure used to create the flat file.
18. Explain the purpose of the input file definition feature of ACL
It has the ability to read data stored in most formats. Auditors will know the source file
physically resides and its field layout.
19. Assume that an auditor is reviewing a file containing 25 fields of data, only 5 of which are
relevant to the auditor’s objective. Explain how ACL can help in this situation
ACL software has a filter capability in which irrelevant data are not included in sampling for
audit procedures. Resulting in less work effort and better time management.
ACL’s expression builder used in filters allows to use logical operators to define and test
conditions of any complexity and to process only those records that match specific conditions.
When records are fairly evenly distributed across strata, record sampling is preferred, having
each record equal chance of being chosen.
If file is heavily skewed with large values, MUS is advisable to produce a sample that includes all
larger dollar amounts.