IIA-CIA-Part2 Practice Questions

A.  

The CAE should send the final report to operational and senior management and the audit committee.

B.  

The CAE should send the final report to operational management only, as there is no need to communicate this information to higher levels.

C.  

The CAE should notify operational and senior management that the audit engagement was completed with no significant findings to report.

D.  

The CAE should send the final report to operational management and notify senior management and the audit committee that no significant findings were identified.

A.  

Require the approval of additions and changes to the vendor master listing, where the inherent risk of false vendors is high.

B.  

Monitor amounts paid each period and compare them to the budget to identify potential issues.

C.  

Compare employee addresses to vendor addresses to identify potential employee fraud.

D.  

Monitor customer quality complaints compared to the prior period to identify vendor issues.

A.  

Present the revised audit plan directly to the board for approval.

B.  

Communicate with the chief financial officer and present the revised audit plan to the CEO tor approval

C.  

Present the revised audit plan directly to the CEO for approval

D.  

Communicate with the CEO and present the revised audit plan to the board for approval.

A.  

The chief audit executive may recommend that management conduct further work to identify the root cause and address the issue

B.  

Internal auditors should finish the engagement without conducting the root cause analysis and draft the audit report, though the report would not be considered complete until the analysis is concluded

C.  

internal auditors must adjust their future engagement schedule to ensure that the root cause analysis is always performed before the engagement is concluded

D.  

Internal auditors should Instead perform a Pareto rule analysis

A.  

Internal auditors must exercise due professional care to ensure that all significant risks will be identified.

B.  

Internal auditors must apply the care and skill expected of a reasonably prudent and competent internal auditor.

C.  

Due professional care requires the internal auditor to conduct extensive examinations and verifications to ensure fraud does not exist.

D.  

Due professional care is displayed during a consulting engagement when the internal auditor focuses on potential benefits of the engagement rather than the cost

A.  

The most recent risk assessment conducted by management of the area to be reviewed.

B.  

The requests of operational and senior management throughout the organization.

C.  

The preliminary risk assessment performed by internal auditors planning the engagement.

A.  

Operational management, because they are responsible for the day-to-day management of the operational risks.

B.  

The CRO, because he is responsible for coordinating and project managing risk activities based on his specialized skills and knowledge.

C.  

The chief audit executive, although he is not accountable for risk management in the organization.

D.  

The CEO, because he has ultimate responsibility for ensuring that risks are managed within the agreed tolerance limits set by the board.

A.  

1 and 2

B.  

1 and 3

C.  

2 and 4

D.  

3 and 4

A.  

The CAE can release prior internal audit reports with the approval of the board and senior management.

B.  

The CAE can employ judgment and release prior audit results as they deem appropriate and necessary.

C.  

The CAE can only release prior information outside the organization when mandated by legal or statutory requirements.

D.  

The CAE can release prior information provided it is as originally published and distributed within the organization.

A.  

The corporate risk register.

B.  

The strategic plan.

C.  

Internal and external audit reports.

D.  

The board ' s meeting records.

A.  

Reliable information is factual adequate, and convincing so that a prudent informed person would reach the same conclusions as the internal auditor

B.  

Reliable information is the best attainable information through the use of appropriate engagement techniques

C.  

Reliable information supports engagement observations and recommendations and is consistent with the objectives for the engagement

D.  

Reliable information helps the organization and the internal audit activity meet its goals

A.  

To ensure the objectives of the area under review are met

B.  

To ensure senior management supports the reports conclusions

C.  

To ensure report style and grammar are appropriate.

D.  

To ensure report findings are substantiated

A.  

The engagement supervisor must notify the chief audit executive (CAE) that the deficiencies have not been rectified

B.  

The engagement supervisor should rely on professional judgment as to whether the CAE should be informed, or the management action plan should be adjusted

C.  

The engagement supervisor should rely on his negotiation skills and issue an ultimatum to management to remedy the control deficiencies

D.  

Ensure that these deficiencies are captured in the documentation as high-priority areas to be reviewed during the next audit.

A.  

A condition

B.  

An audit objectives

C.  

An audit scope

D.  

An observation rating

A.  

Amend the audit plan so that available audit resources are adequate to meet the plan’s requirements.

B.  

Inform the board and senior management of the resources needed, as well as the associated risks.

C.  

Communicate early to those unit managers whose areas would most likely not be able to get reviewed.

D.  

Get approval from human resources regarding overtime payment to be made in an effort to complete the audit plan.