IIA IIA-CIA-PART1 Online Practice Questions and Exam Preparation

IIA IIA-CIA-PART1 Online Questions & Answers

• Question 461:

  Which of the following would be the least significant consideration when performing a risk analysis?

  A. Financial exposure and potential loss.
  B. Skills available within the audit staff.
  C. Results of prior audits.
  D. Major operating changes.
  B. Skills available within the audit staff.

• Question 462:

  When comparing an organization's current performance to that of the prior year, an internal auditor found that:

  Total labor costs had increased.

  More overtime costs had been incurred.

  The total number of workers had increased.

  Net income was 10 percent lower.

  Based solely on this information, which of the following is a valid conclusion?

  A. Net income per worker decreased.
  B. Wage rates increased.
  C. Worker efficiency decreased.
  D. Total labor hours increased.
  A. Net income per worker decreased.

• Question 463:

  An organization's board received complaints regarding suspicious business dealings involving different departments and asked the internal audit activity to carry out investigations on the complaints. Internal auditors should have a general understanding of which of the following in order to facilitate the investigations?

  A. Risk management techniques.
  B. Internal controls.
  C. Forensic auditing.
  D. Corporate governance structures.
  C. Forensic auditing.

• Question 464:

  Which of the following is an example of an application control?

  A. Employees in the data center must always wear identification badges.
  B. Operating system updates must be installed within 48 hours.
  C. A two-stage authentication process must be used to access customer information.
  D. System backup and recovery testing must be done monthly.
  C. A two-stage authentication process must be used to access customer information.

• Question 465:

  A chief audit executive (CAE) was asked by senior management to establish and manage a risk management function. A new chief risk officer was hired a year later to assume these responsibilities. As this function was included in the current annual audit plan, the CAE engaged an external resource for a risk management engagement. Which of the following potential threats to objectivity was the CAE likely addressing?

  A. Self-review threat.
  B. Advocacy threat.
  C. Familiarity threat.
  D. Personal relationship threat.
  A. Self-review threat.

• Question 466:

  During a review of the procurement function, an internal auditor identified an existing control for adding new vendors into the vendor contract system. Which of the following would best help the auditor determine the adequacy of the control's design?

  A. Flowchart of the vendor addition process.
  B. Independent confirmations sent to vendors.
  C. Analysis of the control's costs and benefits.
  D. Interview with management of the procurement function.
  A. Flowchart of the vendor addition process.

• Question 467:

  An internal audit charter describes the mission and scope of the internal audit activity (IAA), responsibilities of the IAA, accountability of the chief audit executive, independence of the IAA, and standards followed by the IAA. Which of the following also should be included in the charter?

  A. The purpose of the IAA.
  B. The IAA's right to have unrestricted access to functions, records, personnel, and physical property.
  C. A detailed audit plan or program for the year.
  D. The job specifications and descriptions of the internal audit staff.
  B. The IAA's right to have unrestricted access to functions, records, personnel, and physical property.

• Question 468:

  An internal auditor has taken an attributes sample of a bank's existing loan portfolio. Out of a sample of 60 loans, the auditor found:

  Four that were not properly collateralized.

  Five that were not in compliance with bank policies (other than lack of collateralization).

  Four that were part of a related-party group, but were set up as separate loan entities.

  Of the 60 loans selected in the sample, these errors were noted on a total of 10 loans.

  Several loans had multiple problems.

  Which of the following conclusions can the auditor reach from these observations?

  1. There is suficient evidence that fraudulent activity is taking place by one or more of the bank's lending officers.

  2. The financial statements will be misstated as a result of these actions.

  3. There are significant noncompliance audit findings that should be reported.

  A. 3 only
  B. 1 and 2 only
  C. 1 and 3 only
  D. 2 and 3 only
  A. 3 only

• Question 469:

  The manager of the payroll department requested a review of the payroll process, but only wants the engagement to include processes related to approval of time worked. What type of activity is this?

  A. Financial assurance engagement.
  B. Operational consulting engagement.
  C. Compliance assurance engagement.
  D. Risk management consulting engagement.
  B. Operational consulting engagement.

• Question 470:

  The work papers for an audit of hazardous-materials handling and disposal at an engineering research facility provide evidence that the following procedures were performed.

  Drums of hazardous waste not yet shipped off-site were inventoried. The physical count agreed with the company's inventory records. A sample of hazardous-waste shipments received at the disposal site was compared to bills of lading and

  company records. No errors were detected.

  The audit staff observed engineering personnel during the handling of hazardous materials. No company policy violations were noted. The reconciliation of waste drums to the inventory records provides evidence that:

  A. Hazardous-waste materials were being disposed of as prescribed by company policy.
  B. The amount of hazardous materials being used was accurately recorded.
  C. Records of drums shipped to the waste disposal site were being maintained.
  D. All hazardous-waste drums in inventory were accounted for.
  D. All hazardous-waste drums in inventory were accounted for.