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

IIA IIA-CIA-PART2 Online Questions & Answers

• Question 561:

  An internal audit manager assigns an audit team to test purchase transactions by selecting a sample from transactions processed by each of the three procurement officers. Which of the following techniques will help the audit team achieve this sampling objective?

  A. Systematic sampling.
  B. Stratified sampling.
  C. Stop-or-go sampling.
  D. Discovery sampling.
  B. Stratified sampling.

• Question 562:

  A recent survey indicated that residents of a small town take the train to a nearby city eight times per month, on average. The same survey showed that the number of train trips that a resident takes per month (y) is determined by the number of days per month that the resident works in the nearby city (x), according to the equation: y = 2 + 2x. A person who never works in the nearby city is expected to take the train:

  A. Zero times per month.
  B. Two times per month.
  C. Four times per month.
  D. Eight times per month.
  B. Two times per month.

• Question 563:

  Which of the following is a red flag associated with improper asset valuation?

  A. Unusual increase in gross margin.
  B. Unusual decrease in the number of days' purchases in inventory.
  C. Recurring positive cash flows from operations.
  D. Allowance for bad debts that is increasing in percentage terms.
  A. Unusual increase in gross margin.

• Question 564:

  In order to effectively elicit sensitive information from an employee during an audit engagement, an auditor should:

  A. Tell the employee a piece of information obtained from a coworker in a previous interview.
  B. Put sensitive questions at the beginning of a questionnaire to ensure that they are answered.
  C. Explain that the auditor's reputation for integrity, which is vital to the auditor's business success, would be seriously damaged if confidentiality were breached.
  D. Point out that management has given the auditor full authority to conduct this interview.
  C. Explain that the auditor's reputation for integrity, which is vital to the auditor's business success, would be seriously damaged if confidentiality were breached.

• Question 565:

  Which of the following factors would be the most critical in determining which engagements should be included in the annual internal audit plan?

  A. Whether an audit is explicitly required by the internal audit charter.
  B. The extent to which the work to be performed is an assurance or consulting engagement.
  C. The organization's annual risk management strategy.
  D. Risks that are identified by operations staff or senior management.
  C. The organization's annual risk management strategy.

• Question 566:

  An organization's internal auditors are reviewing production costs at a gas-powered electrical generating plant. They identify a serious problem with the accuracy of carbon dioxide emissions reported to the environmental regulatory agency, due to computer errors. The auditors should immediately report the concern to:

  A. The regulatory agency.
  B. Plant management.
  C. A plant health and safety officer.
  D. The risk management function.
  B. Plant management.

• Question 567:

  In reviewing the appropriateness of the minimum quantity level of inventory established by a department, an auditor would be least likely to consider:

  A. Stockout costs, including lost customers.
  B. Seasonal variations in forecasting inventory demand.
  C. Optimal order sizes determined by an economic order quantity model.
  D. The potential for obsolescence of inventory items.
  C. Optimal order sizes determined by an economic order quantity model.

• Question 568:

  In response to an accounts receivable Confirmation, a customer indicated that the invoice listed on the Confirmation letter had been paid two months earlier. This may indicate that:

  A. The receivable was selected for Confirmation in error.
  B. The customer is a bad credit risk.
  C. The receivable should be written off.
  D. Fraudulent activity has occurred.
  D. Fraudulent activity has occurred.

• Question 569:

  Which of the following is the most appropriate step for the chief audit executive to take in order to avoid defamation of character of the principal suspect in a fraud investigation?

  A. Restrict the use of potentially damaging words to privileged reports or discussions.
  B. Label all workpapers, reports, and correspondence of the internal audit activity as private.
  C. Restrict discussions of the fraud to members of management who express an interest in the investigation.
  D. Destroy all investigation workpapers and reports if the fraud cannot be proven.
  A. Restrict the use of potentially damaging words to privileged reports or discussions.

• Question 570:

  Which of the following items should be addressed in an organization's privacy statement?

  I. Intended use of collected information.

  II. Data storage and security.

  III. Network/infrastructure authentication controls.

  IV.

  Data retention policy of the organization. Parties authorized to access information.

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