GS007 Quiz

The client does a Daily NAV Reconciliation. We have obtained the full listing and determined that the population is complete. How many samples should we select for our testing?

• 50 - This control is easy to test so we should can test a sample of 50.

• 25 - Daily controls should be tested 25 times per EY GAM.

• 10 - No need to test many samples, how bad could a NAV rec be?

• 36 - We should be testing 10% of the entire population of 365 per EY GAM

The client has a control around new investor application forms for its Managed Funds. It accepts 230 new applications for the period across all its Managed Funds. How many samples should we test as part of our procedures?

• 0. 0. Managed Funds are not covered under the scope of GS007.

• 23 - We should test 10% of our population.

• 25 - This is a daily control so we must test 25.

• 230 - It is important to cover off all our risk so we should test all application forms

Tags

CCSS.7.SP.A.2

The client has onboarded three new mandate clients in the period, and has a control around how each IMA should be signed and approved before investing has begun on behalf of the client. When we test this control, how many samples should we test?

• 1 - For any population of less than 5 we only need to test 1.

• 0 - This population is immaterial, there is no need to test it

• 3 - When the population is less than 5, we should be testing the entire population

• 2 - We should at least be covering off half of the population, so 2 is a good amount to cover this

The Client has an IT Service Provider (Computa Masterz), who they engage to do a daily back-up of their services. How many samples should we test as part of our population?

• 0 - This control is performed by an outsourced Service Provider so falls outside the control environment of the Client.

• 25 - This is a daily control, therefore we should test 25.

• 1 - As this is performed by a specialist Service Provider, this lowers our risk, so 1 will do.

• 36 - We should be testing 10% of the population

The client performs monthly reconciliations of their bank accounts. Over the last year, they have switched banks twice. How many monthly reconciliations should we examine to assess the control's effectiveness?

• 12 - One for each month to ensure consistency throughout the year.

• 3 - Only the first, middle, and last month to get a broad overview.

• 6 - Since they have used three different banks, we should test each bank twice.

• 2 - We test two instances of monthly controls - randomly sampled.

Tags

CCSS.7.SP.A.2

The Client conducts 500 trades across its Funds throughout the year. Each trade is manually checked post-trade to make sure it complies with the rules established for the Funds. They have conducted at least one trade per day, every day. How many trades should we sample as part of our testing?

• 25 - Since they have traded every day, this is a daily control. Therefore, 25.

• 0 - Trades are just a fake concept made up by a capitalist society and don't really exist. How can you test something that doesn't exist?

• 50 - This is an ad-hoc control so we should test 10% of it. Therefore, 50.

• 25 - This is an ad-hoc control and our sample size is over 250. Therefore we should test our maximum sample size, 25.

The Client reports to investors on the performance of its Funds once per quarter. How many samples should we select as part of our testing?

• 2 - We test two samples for quarterly controls. We test our two quarterly samples for all the Funds.

• 4 - The population is less than 5 so we will test the entire population

• 1 - One representative sample to make sure this control is operating should be fine.

• N/A - we do not know how many Funds the client has, so not enough information to answer this question

What is the name of the type of sampling we typically use for selecting our samples?

• Judgmental Sampling

• Systematic Sampling

• Random Sampling

• We test the entire population all the time

Tags

CCSS.HSS.IC.B.3

Which of the following do we NOT express an opinion on for a Type 2 GS007 Report?

• The friendliness of the client

• The system description

• The design effectiveness of controls

• The operating effectiveness of controls

What is the main purpose of the GS007 guidance statement?

• To offer advice on employee management and leadership style

• To guide businesses on marketing and promotion strategies

• To enforce strict financial penalties on companies

• To provide guidelines on performing and reporting on assurance engagements