IIA IIA-CIA-PART2 Online Practice Questions and Exam Preparation

IIA IIA-CIA-PART2 Online Questions & Answers

• Question 391:

  Which of the following factors would increase the confidence level in a variables sampling plan?

  I. A larger sample size.

  II. A Stratified sample.

  III.

  A larger standard deviation.

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

• Question 392:

  A chief audit executive (CAE) is discussing an upcoming internal control engagement with senior management. Senior management is most concerned with how competitor organizations perform and execute similar controls. Which of the following assessment criteria would the CAE select?

  A. External assessment of competitors.
  B. Benchmarking of practices.
  C. A maturity model.
  D. A market survey.
  B. Benchmarking of practices.

• Question 393:

  The internal audit activity of an investment company received a request to provide assurance on the risk management process. Preliminary discussion with senior management revealed that separate functions within the organization perform some form of risk management activities. Which of the following is the most effective tool for ensuring that risk management activities are coordinated among these functions?

  A. Delphi technique.
  B. Assurance map.
  C. Facilitated workshop.
  D. Analytical reviews.
  B. Assurance map.

• Question 394:

  During a payroll audit of a large organization, an internal auditor noted that the assistant personnel director is responsible for many aspects of the computerized payroll system, including adding new employees in the system; entering direct-deposit information for employees; approving and entering all payroll changes; and providing training for system users. After discussions with the director of personnel, the auditor concluded that the director was not comfortable dealing with information technology issues and felt obliged to support all actions taken by the assistant director. The auditor should:

  A. Continue to follow the engagement program because the engagement scope and objectives have already been discussed with management.
  B. Review the engagement program to ensure testing of direct deposits to employee bank accounts is adequately covered.
  C. Recommend to the chief audit executive that a fraud investigation be started.
  D. Test a sample of payroll changes to ensure that they were approved by the assistant director before being processed.
  B. Review the engagement program to ensure testing of direct deposits to employee bank accounts is adequately covered.

• Question 395:

  A chief audit executive (CAE) has decided to add an engagement to the current audit plan which will exceed available audit resources. Which of the following is the best course of action for the CAE to take?

  A. Present the plan change to senior management and request additional resources before going to the board of directors.
  B. Seek approval from senior management and the board of directors for the plan change and advise them of the issue of limited resources.
  C. Add this change to the plan and request senior management to indicate which other engagement should be deleted to keep the overall plan within resource constraints.
  D. Immediately seek additional resources from senior management and the board of directors to meet the needs of the organization.
  B. Seek approval from senior management and the board of directors for the plan change and advise them of the issue of limited resources.

• Question 396:

  Which phase of an audit engagement is typically the most effective time for an internal auditor to develop a risk and control matrix?

  A. When preparing to recap audit test results.
  B. At sample selection, to determine sampling methodology.
  C. At the start of fieldwork, as part of developing the annual audit plan.
  D. At planning, to assist in developing the engagement work program.
  D. At planning, to assist in developing the engagement work program.

• Question 397:

  An organization does not have a formal risk management function. According to the Standards, which of the following are conditions where the internal audit activity (IAA) may provide risk management consulting?

  1.There is a clear strategy and timeline to migrate risk management responsibility back to management.

  2.The IAA has the final approval on any risk management decisions.

  3.The IAA does not give objective assurance on any part of the risk management framework for which it is responsible.

  4.The nature of services provided to the organization is documented in the internal audit charter.

  A. 1, 2, and 3 only
  B. 1, 2, and 4 only
  C. 1, 3, and 4 only
  D. 2, 3, and 4 only
  C. 1, 3, and 4 only

• Question 398:

  When internal auditors perform a risk assessment, they generally focus on which of the following types of risk?

  A. Inherent risk.
  B. Audit risk.
  C. Detection risk.
  D. Control risk.
  C. Detection risk.

• Question 399:

  A company used simple regression analysis to analyze maintenance costs against machine hours (MH) for a 26-week period when the plant was in full operation.

  The regression yielded the following estimated cost function:

  Maintenance Cost = $60 + $0.25/MH

  The regression analysis also generated a coefficient of determination (R2), or goodness of fit, of 0.85. Which of the following statements regarding this regression analysis is appropriate?

  A. This regression can be used to determine the maintenance cost for any period at any activity level by substituting the machine hours in the equation.
  B. The $60 component represents the best estimate of fixed maintenance costs for the company in a shutdown situation.
  C. The $0.25 component is the slope coefficient of the cost estimate and represents the average variable maintenance cost per machine hour.
  D. The coefficient of determination of R2 = 0.85 indicates that the goodness of fit is poor because the value is close to the maximum value of one.
  C. The $0.25 component is the slope coefficient of the cost estimate and represents the average variable maintenance cost per machine hour.

• Question 400:

  What is the primary purpose of issuing a preliminary communication to management of the area under review?

  A. To build good relations with management.
  B. To help management develop more responsive and timely action plans.
  C. To formally report medium-and high-risk observations in writing.
  D. To improve the internal audit key performance indicators.
  B. To help management develop more responsive and timely action plans.