Free Internal Audit Engagement Practice Questions

A.  

Report the monitoring status to senior management when requested.

B.  

Assist management with implementing corrective actions.

C.  

Determine the frequency and approach to monitoring

D.  

Include all types of observations in the monitoring process

A.  

As the fraud is already being investigated by the corporate investigator, it should be excluded from the scope of the audit engagement

B.  

The engagement should be framed as an advisory engagement to support the corporate investigator ' s work

C.  

The area under investigation should be excluded from the engagement scope if the auditor does not have the technical skills required to support a fraud investigation

D.  

The scope should consider the nature of the fraud risk and control weaknesses identified from the fraud case

A.  

Traditional

B.  

Decentralized

C.  

Centralized

D.  

Customer-centric

A.  

A Gantt chart

B.  

A scatter diagram

C.  

A RACI chart

D.  

A SIPOC diagram

A.  

The need and availability of automated support.

B.  

The potential impact of key risks.

C.  

The expected outcomes and deliverables.

D.  

The operational and geographic boundaries.

A.  

There is a higher reliance on organizational culture

B.  

There are clear expectations set for employees.

C.  

There are electronic monitoring techniques employed

D.  

There is a defined code for employee behavior

A.  

Increased completeness, including risk categories like political, supplier, and social media.

B.  

Business managers can identify and assess risks that occur within each category.

C.  

The internal audit activity can rely on management ' s risk assessment.

D.  

Organizationwide audits are required since risk events within categories occur in many different ways.

A.  

The accounts payable supervisor, accounts payable manager, and controller.

B.  

The accounts payable manager, purchasing manager, and receiving manager.

C.  

The accounts payable supervisor, controller, and treasurer.

D.  

The accounts payable manager, chief financial officer, and audit committee.

A.  

Report the monitoring status to senior management when requested.

B.  

Assist management with implementing corrective actions.

C.  

Determine the frequency and approach to monitoring.

D.  

Include all types of observations in the monitoring process.

A.  

The engagement team should include internal auditors who have expertise in investigating vendor fraud

B.  

The engagement team should be composed of certified accountants who are proficient In financial statement analysis and local accounting principles

C.  

To preserve independence and objectivity, an auditor who worked for the vendor two years prior may not participate on the engagement team

D.  

The engagement team may include an auditor who lacks knowledge of the industry in which the vendor operates

A.  

Comparing the current ratio of the subsidiary with the current ratio of another company for the same period

B.  

Comparing common-size financial statements of the subsidiary with the averages of the industry for the last two periods

C.  

Comparing the sales of the subsidiary with the sales of another subsidiary for the last two periods.

D.  

Comparing the sales of the subsidiary with the budgeted figures for the last two periods

A.  

Audit findings

B.  

Audit resources

C.  

Audit objectives

D.  

Audit plan

A.  

The scope of the engagement, the estimated time frame, and the names of the auditors.

B.  

The estimated time frame, the names of the auditors, and the resources and travel budget.

C.  

The names of the auditors, the resources and travel budget, and the scope of the engagement.

D.  

The resources and travel budget, the scope of the engagement, and the estimated time frame.

A.  

A complete, accurate, and comprehensive account of engagement observations and recommendations.

B.  

Oversight of the coordination between the internal audit activity and independent outside auditors

C.  

The internal audit activity ' s purpose, authority, responsibility, and performance relative to plan.

D.  

Management ' s assertions regarding the system of internal controls.