Student Forums CMA Part 1 Section E: Internal Controls E.1. Governance, Risk, and Compliance Exam succes question about system general controls

Exam succes question about system general controls

  • This topic has 2 replies, 2 voices, and was last updated 3 years ago by Alexey Gnoevoy.
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  • #107347
    Alexey Gnoevoy

    Hello, can you help me to understand following question

    CIA 596 3.42
    A mortgage broker prepared sample mortgage payment schedules on a personal computer to illustrate different payment plans to prospective loan customers. The schedules were especially helpful for loans with variable rates because the schedules illustrated how loan balances would fluctuate over multi-year horizons with different interest rate trends. The mortgage company’s literature was not nearly as helpful, and the broker was convinced the schedules helped customers understand and appreciate the sophisticated loan types, which led to more loans.
    The potential risk of erroneous logic in the schedules could best be minimized by:
    Correct answer: “Adequate independing testing of application”
    My answer: “Requiring adequate documentation for the shedule”

    In my opinion the testing is part of implenting system and the result will lead to creating documentation as part of general controls, and also system testing is after system testing. If system was build and it’s need to be tested testing is a detective fucntionc, where documentation is preventive.

    Can you explain me please?

    Thank you!

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  • #107350
    Brian Hock
    HOCK international


    Just having good documentation in this case would mean only that the erroneous logic in the program would be well documented. The issue is that the logic used in the preparation of the schedules is correct, and more testing of that app would be the best way to do that.

    I would look at the creation of the documentation more as just the documentation of the program and how it works, and not testing whether the program is doing the right things or not.

    Does this help?


    Alexey Gnoevoy

    Brian, hello! Thak you, that helps, i shall consider that documemntation is just documenting the process.

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