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

IIA IIA-CIA-PART2 Online Questions & Answers

• Question 771:

  Which of the following statements is correct regarding the use of a program evaluation and review technique (PERT) model? It makes use of a probability model to arrive at a realistic estimate of time necessary for completion of the audit

  engagement. It requires that activities are performed in sequence such that each task is completed before the commencement of the next activity. It remains fixed once completed to act as a baseline for measuring the performance of the

  audit staff following completion of the engagement.

  It begins with the auditor-in-charge identifying the overall scope and then breaking down the audit engagement into identifiable activity units.

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

• Question 772:

  The chief audit executive (CAE) of a multinational entity with highly automated and complex operations has just completed the update of the risk-based audit plan. Interviews with management revealed the introduction of new technology and a significant increase in both the number and severity of technology-based risk exposures. According to the International Professional Practices Framework, which of the following would be the best course of action for the CAE to undertake next?

  A. Develop a detailed audit plan that makes the most efficient use and reallocation of existing internal audit resources.
  B. Arrange for the outsourcing of some technology intensive audit processes and procedures based on the plan changes.
  C. Evaluate whether appropriate skills and knowledge required to perform the necessary audit work currently exist in the department.
  D. Begin planning to recruit information technology audit specialists and other expert personnel into the internal audit activity.
  C. Evaluate whether appropriate skills and knowledge required to perform the necessary audit work currently exist in the department.

• Question 773:

  An internal auditor wanted to determine whether the organization's 200 employees are charging their work hours accurately to the correct project The internal auditor selected a sample of 30 employee time reports for testing. Based on the testing, the internal auditor determined the following:

  -5 time reports were incorrect.

  -21 time reports were correct.

  -

  4 time reports were not supported.

  Which of the following conclusions is appropriate?

  A. The organization has significant flaws in its reporting of employee time, which could lead to the overstatement of project labor costs. The organization's failure to report accurate and complete employee time could lead to potential fraud and abuse.
  B. The organization needs to ensure that all reporting of employee time is accurate and complete for each of its projects. By doing so, the organization can minimize potential issues related to overstating employee times and labor project costs.
  C. The organization overstated project costs due to inaccurate and incomplete reporting of employee time charged to the affected accounts. As a result, the organization cannot ensure all projects costs are accurately reported to stakeholders.
  D. The organization generally ensured that employee hours charged to each project were accurate and complete. However, there were instances of employee time reports that were incorrect or not supported to justify the multiple project labor costs.
  B. The organization needs to ensure that all reporting of employee time is accurate and complete for each of its projects. By doing so, the organization can minimize potential issues related to overstating employee times and labor project costs.

• Question 774:

  An internal auditor wrote in her observation that there were several employees who regularly used the organization's vehicle for personal purposes on the weekends. There was previously a policy that permitted personal usage of the organization's vehicles, though the policy was cancelled when changes in government taxation schemes were introduced. Which of the following would be needed to demonstrate the priority of this observation?

  A. The names and positions of employees who were involved in the misuse.
  B. The specific condition and recommendations to address the root cause.
  C. The Defined criteria and reference documents that support the criteria.
  D. The real and potential impact of the condition.
  D. The real and potential impact of the condition.

• Question 775:

  Which of the following is not true regarding the management of internal audit resources?

  A. A minimum level of information technology knowledge is necessary.
  B. The adequacy of internal audit resources is ultimately a board responsibility.
  C. Resources include external service providers and computer-assisted audit techniques.
  D. Skills availability must be aligned with financial constraints.
  D. Skills availability must be aligned with financial constraints.

• Question 776:

  Which of the following is a key advantage of the internal audit activity using data analytics software?

  A. The internal audit activity will be able to provide absolute assurance due to the accuracy of automated tools.
  B. The internal audit activity will be able to analyze the entire data population rather than selecting samples.
  C. The internal audit activity will be able to ensure consistently accurate analysis and interpretation of results.
  D. The internal audit activity will be able to automate processes, thereby eliminating audit risk.
  B. The internal audit activity will be able to analyze the entire data population rather than selecting samples.

• Question 777:

  Which of the following is typically not a reason for committing financial statement fraud?

  A. To dispel negative market perception.
  B. To disguise a duplicate payment to a vendor.
  C. To obtain more favorable terms on nancing.
  D. To receive performance-related bonuses.
  B. To disguise a duplicate payment to a vendor.

• Question 778:

  An internal auditor is using attributes sampling to test internal controls. Under which of the following circumstances would the auditor increase the original sample size to estimate error occurrence at a given precision and confidence level?

  A. The sample rate of occurrence plus the precision exceeds the acceptable error rate.
  B. The sample rate of occurrence is less than the acceptable error rate.
  C. The acceptable rate of occurrence less the precision exceeds the sample rate of occurrence.
  D. The sample rate of occurrence plus the precision equals the acceptable error rate.
  A. The sample rate of occurrence plus the precision exceeds the acceptable error rate.

• Question 779:

  During an engagement, an internal auditor discovered that an organizations policy on delegation of authority listed six individuals who were no longer employed with the organization. In addition, four individuals acting with disbursement authority were not identified in the policy as having such authority. Which of the following is the most effective course of action to address the control weakness?

  A. Immediately initiate a complete audit of the disbursement function to determine if significant frauds have occurred.
  B. Recommend that management review the process supporting the policy and make improvements.
  C. Advise management to add the four additional names and remove the incorrect names from the policy to make it current.
  D. Review further to ensure that the four individuals do not have the appropriate authority through delegation.
  B. Recommend that management review the process supporting the policy and make improvements.

• Question 780:

  If the chief audit executive believes that senior management has accepted a level of residual risk that is unacceptable to the organization, they should:

  A. Accept the decision of senior management as they are ultimately responsible for risk management.
  B. Report the concern directly to the board.
  C. Discuss the concern with management and if not resolved, escalate it to the board.
  D. Disclose the issue in the audit report when auditing the area where the risk was identified.
  C. Discuss the concern with management and if not resolved, escalate it to the board.