IIA-CIA-Part1 Practice Questions

A.  

A monitoring process,

B.  

A risk assessment process.

C.  

A strategic objective-setting process.

D.  

An information and communication process.

A.  

The internal audit charter does not identify which audit services are outsourced

B.  

The internal audit charter has not been reviewed by the legal department

C.  

The internal audit charter has not been approved by the board within the past year

D.  

The internal audit charter does not describe the authority of the internal audit activity

A.  

Net.

B.  

Controllable.

C.  

inherent,

D.  

Residual.

A.  

Internal audit management.

B.  

Conflict negotiation.

C.  

Critical thinking.

D.  

Persuasion and collaboration.

A.  

Separate the duties of processing and authorizing refunds on merchandise

B.  

Post signs in the register area prompting customers to ask for and examine their sales receipts

C.  

Periodically count the cash in the register and compare it to the expected amount

D.  

Use cash registers with internal tapes that are tamper proof and that require a manager to process voids or refunds

A.  

Bank internal auditors review an activity checklist to determine that the loan officer followed proper procedures.

B.  

The chief financial officer asks for the internal auditor's opinion regarding whether the new accounting pronouncements were properly and comprehensively adopted

C.  

An internal auditor is assigned to assess whether a proposed new initiative to convert a customer service system would be cost effective.

D.  

Senior management asks the internal audit activity to review compliance with customer data security regulations

A.  

Segregation of duties during preparation of the financial statements

B.  

Compensation structures that are based on commissions

C.  

A low rate of turnover in key financial positions

D.  

The presence of a whistleblower policy and fraud hotlinea

A.  

Ensure that all financial information related to the engagement is included in the audit plan and examined for irregularities.

B.  

Document all audit tests completely.

C.  

Consider the possibility of noncompliance or irregularities at all times during an engagement.

D.  

Notify the audit committee of any noncompliance or irregularity discovered during an engagement

A.  

Interview the employee identified by the whistleblower.

B.  

Attain an understanding of the employee's role, responsibilities, and relationship with the supplier.

C.  

Notify senior management, the board, and the external auditor about the alleged fraud

D.  

Review all the orders issued to the supplier to investigate potential fraud.

A.  

Impact and likelihood should be assessed together.

B.  

Impact and likelihood should be given equal consideration by the internal auditor.

C.  

Impact and likelihood should be measured using quantitative methods.

D.  

Impact and likelihood should be used to determine risk response.

A.  

For consulting engagements, internal auditors do not need to be alert to control issues.

B.  

Assurance and consulting services have similar objectives.

C.  

Internal auditors may not perform assurance and consulting roles at the same time.

D.  

Both assurance and consulting engagements require a final engagement report

A.  

Staffing audit engagements with internal auditors who possess professional designations.

B.  

Relying on prior audit work to save planning time and costs.

C.  

Performing assurance procedures to guarantee all significant risks are identified.

D.  

Assessing the cost of assurance in relation to the potential benefits.

A.  

Are the performance targets in your department realistic and attainable?

B.  

Do your coworkers have the knowledge, skills, and training needed to perform their job duties?

C.  

Does your supervisor comply with laws and regulations affecting the organization?

D.  

Do you have sufficient resources, tools, and time to accomplish your work objectives?

A.  

Collect relevant audit evidence and begin working with management of the area to investigate the fraud.

B.  

Inform the chief audit executive and meet with the suspect to determine whether the person committed fraud.

C.  

Document supporting information and recommend an investigation to the appropriate audit management.

D.  

Evaluate existing controls and implement new procedures to mitigate the opportunity for fraud.

A.  

Ensure that returned merchandise is restocked to shelves or sent to the manufacturer by an independent employee.

B.  

Call a sample of customers who returned merchandise to test the legitimacy of the returns and check refund amounts.

C.  

Require that a manager use a reserved register code to approve voids or refunds.

D.  

Analyze voids and refunds by employee, credit card number, and amount for unusual numbers, amounts, or patterns.