ExpertMedium2 marksMultiple Choice
ACCA · Question 2 · Information, technologies and systems
Section A
FinTech Innovators Inc. is migrating its management accounting systems to a public cloud infrastructure.
Which of the following represents the MOST significant risk associated with this transition?
Section A
FinTech Innovators Inc. is migrating its management accounting systems to a public cloud infrastructure.
Which of the following represents the MOST significant risk associated with this transition?
Answer options:
A.
Increased upfront capital expenditure on hardware.
B.
Data security and privacy compliance breaches.
C.
Inability to scale IT resources during peak periods.
D.
Requirement for extensive internal IT maintenance staff.
How to approach this question
Evaluate the characteristics of public cloud computing. It reduces CapEx and internal maintenance, and increases scalability, but introduces external security dependencies.
Full Answer
B.Data security and privacy compliance breaches.✓ Correct
Public cloud infrastructure involves hosting data on third-party servers. For a FinTech company, the primary risk is the security of sensitive financial data and compliance with privacy regulations. Cloud computing actually reduces upfront CapEx, improves scalability, and reduces the need for internal maintenance staff.
Common mistakes
Assuming cloud computing increases internal IT maintenance costs.
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