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IIA-CIA-Part3 Practice Questions

Internal Audit Function

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Question # 1

The management of working capital is most crucial for which of the following aspects of business?

Options:

A.  

Liquidity

B.  

Profitability

C.  

Solvency

D.  

Efficiency

Discussion 0
Question # 2

Which of the following would provide the most relevant assurance that the application under development will provide maximum value to the organization?

Options:

A.  

Use of a formal systems development lifecycle.

B.  

End-user involvement.

C.  

Adequate software documentation.

D.  

Formalized non-regression testing phase.

Discussion 0
Question # 3

Which of the following authentication device credentials is the most difficult to revoke when an employee ' s access rights need to be removed?

Options:

A.  

A traditional key lock.

B.  

A biometric device.

C.  

A card-key system.

D.  

A proximity device.

Discussion 0
Question # 4

According to IIA guidance on IT auditing, which of the following would not be an area examined by the internal audit activity?

Options:

A.  

Access system security.

B.  

Policy development.

C.  

Change management.

D.  

Operations processes.

Discussion 0
Question # 5

An internal auditor was asked to review an equal equity partnership, in one sampled transaction. Partner A transferred equipment into the partnership with a Self-declared value of 510 ,000, and Partner B contributed equipment with a self-declared value of 515,000. The capital accounts reach partner were subsequently credited with $12,500. Which of the following statements Is true regarding this transection?

Options:

A.  

The capital accounts of the partners should be increased by she original cost of the contributed equipment.

B.  

The capital accounts should be increased using a weighted average based by the current percentage of ownership.

C.  

No action is needed, as the capital account of each partner was increased by the correct amount,

D.  

The capital accounts of the partners should be increased by She fair market value of their contribution.

Discussion 0
Question # 6

Which of the following is the best example of a compliance risk that is likely to arise when adopting a bring-your-own-device (BYOD) policy?

Options:

A.  

The risk that users try to bypass controls and do not install required software updates

B.  

The risk that smart devices can be lost or stolen due to their mobile nature

C.  

The risk that an organization intrusively monitors personal information stored on smart devices

D.  

The risk that proprietary information is not deleted from the device when an employee leaves

Discussion 0
Question # 7

One change control function that is required in client/server environments, but is not required in mainframe environments, is to ensure that:

Options:

A.  

Program versions are synchronized across the network.

B.  

Emergency move procedures are documented and followed.

C.  

Appropriate users are involved in program change testing.

D.  

Movement from the test library to the production library is controlled.

Discussion 0
Question # 8

An organization was forced to stop production unexpectedly, as raw materials could not be delivered due to a military conflict in the region. Which of the following plans have most likely failed to support the organization?

Options:

A.  

Just-in-time delivery plans.

B.  

Backup plans.

C.  

Contingency plans.

D.  

Standing plans.

Discussion 0
Question # 9

The manager of the sales department wants to Increase the organization ' s net profit margin by 7% (from 43% in the prior year to 50% in the current year). Given the information provided in the table below, what would be the targeted sales amount for the current year?

Question # 9

Options:

A.  

$20,000,000

B.  

$24.500.000

C.  

$30.000.000

D.  

$35.200.000

Discussion 0
Question # 10

Which of the following statements is true regarding the term " flexible budgets " as it is used in accounting?

Options:

A.  

The term describes budgets that exclude fixed costs.

B.  

Flexible budgets exclude outcome projections, which are hard to determine, and instead rely on the most recent actual outcomes.

C.  

The term is a red flag for weak budgetary control activities.

D.  

Flexible budgets project data for different levels of activity.

Discussion 0
Question # 11

Based on lest results, an IT auditor concluded that the organization would suffer unacceptable loss of data if there was a disaster at its data center. Which of the following test results would likely lead the auditor to this conclusion?

Options:

A.  

Requested backup tapes were not returned from the offsite vendor In a timely manner.

B.  

Returned backup tapes from the offsite vendor contained empty spaces.

C.  

Critical systems have boon backed up more frequently than required.

D.  

Critical system backup tapes are taken off site less frequently than required

Discussion 0
Question # 12

Which of the following is classified as a product cost using the variable costing method?

Direct labor costs.

Insurance on a factory.

Manufacturing supplies.

Packaging and shipping costs.

Options:

A.  

1 and 2

B.  

1 and 3

C.  

2 and 4

D.  

3 and 4

Discussion 0
Question # 13

Through meetings with management, an organization ' s chief audit executive (CAE) learns of a risk that exceeds the established risk tolerance. What would be an appropriate next action for the CAE to take?

Options:

A.  

Design and recommend an appropriate response to the risk

B.  

Discuss the risk and the implications of the risk with management responsible for the risk area

C.  

Schedule an audit of the risk area to assess the risk likelihood and impact

D.  

Prepare a memo to report the risk to the board

Discussion 0
Question # 14

Which of the following should be included in a data privacy poky?

1. Stipulations for deleting certain data after a specified period of time.

2. Guidance on acceptable methods for collecting personal data.

3. A requirement to retain personal data indefinitely to ensure a complete audit trail,

4. A description of what constitutes appropriate use of personal data.

Options:

A.  

1 and 2 only

B.  

2 and 3 only

C.  

1, 2 and 4 only

D.  

2, 3, and 4 only

Discussion 0
Question # 15

An organization ' s IT systems can only be accessed using the organization ' s virtual private network. However, organizational emails, videoconferencing, and file-sharing tools are cloud-based and can be accessed using multi-factor authentication via any device. Which of the following risks should the organization acknowledge?

Options:

A.  

The risk that internal data can be leaked via unapproved applications

B.  

The risk that virtual private networks are not secure

C.  

The risk that remote access controls are usually ineffective in cloud solutions

D.  

The risk that employees may read organizational emails outside of business hours

Discussion 0
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