Consequences of Non-Compliance CT-FT Practice Questions (Page 2)

Questions 6–10

1. 6application · medium

   A compliance tester is designing test cases for a system that must comply with a regulation requiring that all customer transactions are logged with a timestamp and user ID. Which test case would best verify this compliance requirement?

   • AVerify that the system's user interface is user-friendly.
   • BVerify that the system can generate a report of all transactions over a certain amount.
   • CPerform a transaction and verify that the log entry contains the correct timestamp and user ID.
   • DVerify that the system can handle a high volume of transactions without crashing.
   Reveal Solution Discussion Select an answer first
2. 7expert · hard

   A compliance team is evaluating two non-compliance risks in a payment system: (A) a failure to detect duplicate payments, which could result in overpayments to vendors, and (B) a failure to encrypt customer data at rest, which could lead to a data breach. The team has limited resources and must prioritize testing. Which approach best aligns with risk-based testing?

   • APrioritize risk A because overpayments are a direct financial loss.
   • BPrioritize risk B because the likelihood of a data breach is high and the financial and reputational consequences are severe.
   • CTest both risks equally because both are compliance issues.
   • DPrioritize risk A because duplicate payments are easier to detect in testing.
   Reveal Solution Discussion Select an answer first
4. 8application · medium

   A financial institution's system fails to generate a required audit trail for certain transactions, violating an internal policy. The compliance team is categorizing the consequences. Which consequence is primarily a reputational impact?

   • AThe institution's IT team must manually reconstruct the audit trail.
   • BThe institution's legal team reviews the policy.
   • CCustomers lose confidence and move their accounts to competitors.
   • DThe institution must pay a fine to the regulator.
   Reveal Solution Discussion Select an answer first
5. 9expert · hard

   A compliance testing team is prioritizing test cases for a new anti-money laundering (AML) transaction monitoring system. They have identified two potential non-compliance scenarios: (1) a failure to flag transactions just below the reporting threshold, which could lead to regulatory fines, and (2) a failure to generate internal reports for the compliance officer, which could delay internal reviews. The team has limited testing resources. How should they prioritize?

   • APrioritize scenario 2 because it is easier to test.
   • BPrioritize scenario 1 because the likelihood of detection by regulators is high and the financial penalty is substantial.
   • CPrioritize scenario 2 because internal reports are needed for daily operations.
   • DTest both scenarios equally because all non-compliance is equally important.
   Reveal Solution Discussion Select an answer first
6. 10expert · hard

   A compliance testing team is deciding where to focus its limited testing effort. They have identified two potential non-compliance issues: (1) a failure to apply a new tax rate to certain transactions, which could result in underpayment of taxes, and (2) a failure to display a required risk warning to customers, which could lead to regulatory sanctions. The team must choose which to test first. Which factor should most influence their decision?

   • AThe ease of fixing the issue if found.
   • BThe number of test cases that can be automated.
   • CThe likelihood of the issue being detected by regulators and the severity of the resulting penalty.
   • DThe preference of the development team.
   Reveal Solution Discussion Select an answer first