Master of Accountancy
Comprehensive Final Exam
Part I
Monday, April 28, 2008
ALB 102
4:00-8:00 PM
Exam Procedures
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Students will use the laptops provided to take the exam. No notes, books, electronic files, or
electronic gadgets may be brought into the exam. Students may bring drinks, ear plugs, and a
pen or pencil. The department will provide scratch paper for those students who wish to make
notes during the test.
Students are welcome to get a drink, use the restroom, or take a short walk during the exam
period but will not receive extra time for these interruptions.
Your answers should be submitted to the department administrative assistant no later than the
end of each exam period.
Anonymity: The exam questions will be graded anonymously. In other words, the graders will
not know whose exam they are grading. To aid with this process, you will be assigned a test
number when you arrive for your exam. Only the test administrator will know which number
corresponds to which student. You should use only your test number, instead of your name,
when saving and writing all of your answers.
Please note: Your answers should be saved in separate files. The file name should be
‘TestNumber#_QUESTION’. For example: ‘Test10_Auditing’ or ‘TestNumber10_Theory’.
Each file should contain a header with your test number and the page number in the upper right hand
corner.
Exam #
Master of Accountancy
Comprehensive Final Exam
Spring 2008
Question 1. Comparative Accounting Theory Question
A finance professor once told me that accounting is useless. According to efficiency theory, he said,
accounting information is released too late and provides too little information to be of any use to the
capital markets. Do you agree with his comments? Why or why not? Give several specific examples
from the accounting literature that support your opinion.
Your answer should contain the following:
 A clear statement of your position regarding the finance professor’s statement.
 Clear support for your position. Acceptable support may include 1) descriptions and examples
of alternative theories; 2) descriptions and examples of alternative versions of efficiency theory;
and 3) examples from academic accounting studies.
You do not need to include support from all three of these categories, but you must include at least
three (3) specific examples from the academic literature to pass this question!
For grading purposes, please double space your answer and include a header that includes your assigned
ID and the page numbers.
Master of Accountancy
Comprehensive Final Exam
Spring 2008
Question 2. Accounting Information Systems
In 1992, Peter Drucker wrote:
People usually consider accounting to be “financial.” But that is valid only for the part, going
back seven hundred years, that deals with assets, liabilities, and cash flows; it is only a small part
of modern accounting. Most of accounting deals with operations rather than with finance, and
for operational accounting, money is simply a notation and the language in which to express
nonmonetary events. Indeed, accounting is being shaken to its very roots by reform movements
aimed a moving it away from being financial and toward becoming operational.
There is the new “transactional” accounting that attempts to relate operations to their expected
results. There are attempts to change asset values from historical cost to estimates of expected
future returns. Accounting has become the most intellectually challenging area in the field of
management, and the most turbulent one. All these new accounting theories aim at turning
accounting data into information for management decision making.
Required:
a. Do you agree with Drucker? Why or why not? Explain.
b. In the context of your answer, what role, if any, have the advances in “accounting information
systems” played in this “evolutionary” step described by Drucker?
Question 2
You have just been engaged by a new client to evaluate the risks and threats to their management and
accounting information systems. They are particularly concerned about data integrity and security.
Required:
How would you go about planning this engagement? Do not discuss any specific types of threats (i.e.,
espionage, fraud) or specific controls