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

IIA IIA-CIA-PART1 Online Questions & Answers

• Question 751:

  Which of the following would be the most effective method for an internal auditor who is attempting to detect ongoing ctitious vendor fraud?

  A. Observe the cash disbursement process to ensure compliance with the approval process.
  B. Review relevant organizational charts and business process maps to identify if there are segregation of duty concerns.
  C. Select a sample of high-risk disbursements and match the purchase order, goods receipt, and supplier's invoice to ensure disbursements are for items ordered and received.
  D. Provide training to individuals in the accounts payable department regarding common fraud risks in the payables process.
  C. Select a sample of high-risk disbursements and match the purchase order, goods receipt, and supplier's invoice to ensure disbursements are for items ordered and received.

• Question 752:

  Which of the following is ultimately responsible for the continuing professional development of internal audit activity staff?

  A. Individual internal auditors.
  B. Chief audit executive.
  C. Board of directors.
  D. CEO.
  B. Chief audit executive.

• Question 753:

  A chief audit executive (CAE) is planning to issue an annual report concluding on the overall effectiveness of the organization's internal control system. According to the Standards, which of the following is likely the most significant challenge facing the CAE when creating the report?

  A. The opinion must include difficult to measure risks such as the risks of management override of controls, and collusion among dishonest personnel.
  B. The opinion is dependent on complex analyses of numerous internal audit engagements carried out over the prior year.
  C. The opinion is only issued once a year, limiting its usefulness.
  D. Assessing control effectiveness is complicated by inherent risks.
  A. The opinion must include difficult to measure risks such as the risks of management override of controls, and collusion among dishonest personnel.

• Question 754:

  What role, if any, should the internal audit activity have in the process of following up on observations and recommendations made by the external auditors?

  A. The internal audit activity should have no role in this process in order to ensure independence.
  B. The internal audit activity should become involved only if the chief audit executive has suficient evidence that the follow-up is not occurring.
  C. The internal audit activity should review the adequacy and effectiveness of management's follow-up actions.
  D. The internal audit activity should become involved only if specifically requested by management or the board of directors.
  C. The internal audit activity should review the adequacy and effectiveness of management's follow-up actions.

• Question 755:

  A manufacturer uses a materials requirements planning (MRP) system to track inventory, orders, and raw materials requirements. What condition should an auditor search for in the MRP database if a preliminary assessment indicated that

  inventory is understated?

  I- Item cost set at zero.

  II-. Negative quantities on hand.

  III-. Order quantity exceeding requirements.

  IV-. Inventory lead times exceeding delivery schedule.

  A. I and II only
  B. I and IV only
  C. II and IV only
  D. III and IV only
  A. I and II only

• Question 756:

  An internal auditor pays to participate in the company's annual golf tournament, which is held outside of normal business hours. The auditor wins the putting contest and is awarded an all-expense-paid weekend vacation. According to the IIA Code of Ethics regarding objectivity, the auditor's best course of action would be to:

  A. Refuse the prize because the amount is significant.
  B. Accept the prize because the event was held outside of normal business hours.
  C. Refuse the prize because it represents an impairment to objectivity.
  D. Accept the prize because the auditor received no special treatment.
  D. Accept the prize because the auditor received no special treatment.

• Question 757:

  Which of the following, other than the internal audit charter, is most likely to Define the purpose, authority, and responsibility of the internal audit activity (IAA)?

  A. The chief audit executive job description.
  B. The internal audit policy statement.
  C. The organization's charter to conduct operations.
  D. The IAA vision statement.
  B. The internal audit policy statement.

• Question 758:

  Which of the following would be most relevant regarding the internal control environment?

  A. Assessing controls over computerized applications.
  B. Documenting the organizational structure.
  C. Comparing and validating internal performance with external benchmarking.
  D. Maintaining and reviewing detailed financial records.
  B. Documenting the organizational structure.

• Question 759:

  Which of the following provides the best explanation of risk management?

  A. Risk management is most effective when both managers and internal auditors consider all areas of risk immediately after the organization sets its strategy.
  B. Risk management ensures the achievement of the organization's profitability goals by identifying and addressing risks.
  C. Risk management must be a separate function within the organization in order for the internal audit activity to add value.
  D. Risk management involves not only the mitigation of risks, but also the exploitation of opportunities that enable success.
  D. Risk management involves not only the mitigation of risks, but also the exploitation of opportunities that enable success.

• Question 760:

  Management has asked the chief audit executive (CAE) to provide assurance on the organization's automated control system related to financial data. The current audit staff does not have the expertise needed to conduct this type of engagement. Which of the following would be the best response by the CAE?

  A. Accept the assignment and use control self-assessment to complete the project.
  B. Do not accept the assignment because the internal audit activity lacks the competency to perform the engagement with due professional care.
  C. Accept the assignment and use an external provider with the necessary knowledge and skills to perform the engagement.
  D. Accept the assignment if the engagement is included in the current audit plan, but inform senior management that the current audit staff does not have the knowledge and skills required.
  C. Accept the assignment and use an external provider with the necessary knowledge and skills to perform the engagement.