The greatest risk associated with the situation of business units purchasing cloud-based applications without IT support is that the applications may not reasonably protect data. Cloud-based applications are software applications that run on the internet, rather than on a local device or network. Cloud-based applications offer many benefits, such as scalability, accessibility, and cost-effectiveness, but they also pose many challenges and risks, especially for data security1.
Data security is the process of protecting data from unauthorized access, use, modification, disclosure, or destruction. Data security is essential for ensuring the confidentiality, integrity, and availability of data, as well as complying with legal and regulatory requirements. Data security is especially important for cloud-based applications, as data are stored and processed on remote servers that are owned and managed by third-party cloud service providers (CSPs)2.
When business units purchase cloud-based applications without IT support, they may not be aware of or follow the best practices and standards for data security in the cloud. They may not perform adequate risk assessments, vendor evaluations, contract reviews, or audits to ensure that the CSPs and the applications meet the organization's data security policies and expectations. They may not implement appropriate data encryption, backup, recovery, or disposal methods to protect the data in transit and at rest. They may not monitor or control the access and usage of the data by internal or external users. They may not report or respond to any data breaches or incidents that may occur3.
These actions or inactions may expose the organization's data to various threats and vulnerabilities in the cloud, such as cyberattacks, human errors, malicious insiders, misconfigurations, or legal disputes. These threats and vulnerabilities may result in data loss, leakage, corruption, or compromise, which may have serious consequences for the organization's reputation, operations, performance, compliance, and liability4.
Therefore, it is essential that business units consult and collaborate with IT support before purchasing any cloud-based applications, and follow the organization's guidelines and procedures for cloud security. IT support can help business units to select and use cloud-based applications that are suitable and secure for their needs and objectives.
References:
* Top 5 Risks With Cloud Software and How to Mitigate Them4
* Mitigate risks and secure your cloud-native applications3
* 12 Risks, Threats & Vulnerabilities in Moving to the Cloud2
* Best Practices to Manage Risks in the Cloud1

The best compensating control when segregation of duties is lacking in a small IS department is transaction log review. Transaction log review can help detect any unauthorized or fraudulent activities performed by IS staff who have access to multiple functions or systems. Transaction log review can also provide an audit trail for accountability and investigation purposes. The other options are not as effective as transaction log review in compensating for the lack of segregation of duties. Background checks are preventive controls that can help screen potential employees for any criminal records or dishonest behavior, but they do not prevent existing employees from abusing their access privileges. User awareness training is a detective control that can help educate users on how to report any suspicious or abnormal activities in the IS environment, but it does not monitor or verify the actions of IS staff. Mandatory holidays are deterrent controls that can discourage IS staff from engaging in fraudulent activities by requiring them to take periodic leave, but they do not prevent or detect such activities when they occur. References: CISA Review Manual (Digital Version), Chapter 3, Section 3.2

Comprehensive and Detailed Step-by-Step Explanation:
Audit findings should be communicated as early as possible to avoid misunderstandings, provide an opportunity for corrective action, and ensure transparency.
* Option A (Incorrect):The planning phase involves defining audit scope, objectives, and methodology, but findings are not yet available to discuss with management.
* Option B (Incorrect):The reporting phase formalizes audit results, but discussing issuesonlyat this stage may lead to delays in corrective action.
* Option C (Incorrect):The follow-up phase ensures that management has implemented corrective actions, but this occursafterthe initial discussion of findings.
* Option D (Correct):The fieldwork phase is when auditors activelygather evidence, analyze data, and identify issues. Discussing observationsduringthis phase allows for immediate clarification, validation, and resolution of misunderstandings before the final report.
Reference:ISACA CISA Review Manual -Domain 1: Information Systems Auditing Process- Discusses audit engagement, reporting, and communication best practices.

Social engineering is a technique that exploits human weaknesses, such as trust, curiosity, or greed, to obtain information or access from a target. An employee is induced to reveal confidential IP addresses and passwords by answering questions over the phone is an example of a social engineering attack method, as it involves manipulating the employee into divulging sensitive information that can be used to compromise the network or system. A hacker walks around an office building using scanning tools to search for a wireless network to gain access, an intruder eavesdrops and collects sensitive information flowing through the network and sells it to third parties, and an unauthorized person attempts to gain access to secure premises by following an authorized person through a secure door are not examples of social engineering attack methods, as they do not involve human interaction or deception. References: [ISACA CISA Review Manual 27th Edition], page 361.