The government health service in country H employs well over 100,000 staff in various locations throughout the country. Traditionally, local management has had high levels of autonomy in relation to personnel issues and there are several different human resources (HR) managers located across various regions.
The government has decided to introduce a completely new HR/payroll information system to have just one database containing all relevant information about every staff member on the payroll (start date, job title, salary and all other details) and to use this information to begin streamlining recruitment and HR policies.
The government has outsourced the system's development to a reputable company.
Which of the following are disadvantages associated with this IT project?

• A. There is a risk that significant anomalies in the current system will be highlighted.
• B. The amount of data storage space required to run the system may not be available.
• C. Any initial problems in running the system could have serious repercussions as it could lead to, for example, staff not being paid, payroll tax not being properly collected, and similar difficulties.
• D. There is a risk that the system will not capture all of the existing terms and conditions of staff, thus leading to industrial relations problems later.
• E. The government is very heavily dependent on the contractor to whom this assignment is outsourced and if they do not to perform as required this could have serious consequences.
• F. The system could make it more difficult to employ specialist medical staff on terms and conditions which are different from the normal terms and conditions available.

The Chief Executive Officer (CEO) of a quoted company has visited the company's Information Technology (IT) Centre in order to meet with the Head of IT. The CEO was concerned to discover that the door to the IT Centre was unlocked, even though the receptionist was not at their desk.
Which THREE of the following are correct?

• A. The CEO should accept that this may have been an isolated incident
• B. The CEO should have locked the door and taken no further action
• C. The CEO should notify the Head of Internal Audit of the breach.
• D. The CEO should initiate disciplinary action against the receptionist
• E. The CEO should inform the Head of IT of the security breach.
• F. The CEO should leave IT security to the Head of IT.

G is an administrator who works for TRF TRF issues its staff with laptop computers that can be linked to the corporate network via Wi-Fi when they are working in the office Staff are permitted to work from home and can connect their company laptops to TRF's network via the internet in order to access files and send and receive emails The software on G's laptop has not been updated for several months When G last updated the software it erased a draft report that he had been working on from his machine Ever since, whenever he logs in and is automatically offered the opportunity to install available updates he clicks the 'install later' option on his screen Some of the outstanding updates relate to the laptop's operating system and others to the software applications such as word processing and spreadsheet packages Which TWO of the following are correct?

• A. There will be no security risks if G only ever connects to TRF's network via the office Wi-Fi.
• B. G should be disciplined for failing to install updates
• C. G's failure to update the operating system is more serious than the failure to update applications.
• D. TRF should not permit staff the option of deferring updates
• E. Users know whether updates are necessary because they know how their laptops are used.

Division A of X plc produced the following results in the last financial year.
Net profit $200,000 Gross capital employed $1,000,000
For evaluation purposes all divisional assets are valued at original cost.
The division is considering a project that has a positive NPV, will increase annual net profit by $15,000, but will require average inventory levels to increase by $50,000 and non-current assets to increase by $50,000.
X plc imposes a 16% capital charge on its divisions. Given these circumstances, will the evaluation criteria of return on investment (ROI) and residual income (RI) motivate division A managers to accept the project?

• A. ROI Yes RI No
• B. ROI No RI No
• C. ROI Yes RI Yes
• D. ROI No RI Yes

The internal audit department has just completed an investigation into the HR department's procedures relating to new staff appointments The head of HR is unhappy with the draft report prepared by the lead internal auditor The report lists several cases in which appointments were made despite the fact that one or more of the entity's formal procedures were not followed The head of HR has complained that the internal auditor's comments do not allow for the fact that the HR department's staff members are often very busy and do not always have time to conduct every check.
The internal auditor's comments also reflect a failure to complete documents None of the omissions have led to the appointment of an unsuitable member of staff Which TWO of the following statements reflect an appropriate response by the board of directors to this report?

• A. The members of staff responsible for these omissions should be subjected to disciplinary action
• B. Ignoring a compliance error altogether may undermine the control environment
• C. The errors are immaterial because they did not lead to an inappropriate appointment
• D. The board should be seen to support the internal audit
• E. The procedures should be removed if the HR department staff believe that they are unnecessary