IIA IIA-CIA-PART3 Online Practice Questions and Exam Preparation

IIA IIA-CIA-PART3 Online Questions & Answers

• Question 241:

  What condition is most likely necessary to the success of a strategy of preemptive expansion?

  A. Competitors believe that the move is preemptive.
  B. The result is intense industry conflict.
  C. The firm does not know the expectations of competitors about the market.
  D. The learning-curve effect is small.
  A. Competitors believe that the move is preemptive.

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  Explanation

  Competitors must believe that the move is preemptive. Hence, the firm should know competitors' expectations about the market or be able to influence them favorably. Moreover, the preempting firm must have credibility, such as resources, technology, and a history of credibility, to support its statements and moves.

• Question 242:

  Which of the following control features consists of a set of authorization codes that distinguishes among actions such as reading, adding, and deleting records?

  A. Internally encrypted passwords
  B. System access privileges.
  C. Logon passwords
  D. Protocol controls.
  B. System access privileges.

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  Explanation

• Question 243:

  Which of the following is most likely to be a disadvantage of decentralization?

  A. Lower-level employees will develop less rapidly than in a centralized organization.
  B. Top management will have less time available to devote to unique problems.
  C. Lower-level managers may make conflicting decisions.
  D. Lower-level managers may lose motivation.
  C. Lower-level managers may make conflicting decisions.

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  Explanation

  The disadvantages of decentralization include a tendency to focus on short-run results to the detriment of the long-term health of the entity, an increased risk of loss of control by top management, the increased difficulty of coordinating interdependent units, and less cooperation and communication among competing decentralized unit managers.

• Question 244:

  Which of the following is likely to have an expiration date and may contain stored clear text passwords?

  A. Cookie
  B. Universal resource locator (URL)
  C. Hypertext transport protocol (HTTP)
  D. Browser
  A. Cookie

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  Explanation

• Question 245:

  As a conflict resolution strategy, optimizing (or a win-win strategy) is most appropriate when:

  A. The benefits being contested cannot be changed.
  B. The relationship between the parties is likely to continue.
  C. People are deeply committed to established habits and patterns.
  D. Time is scarce and the manager's patience is wearing thin.
  B. The relationship between the parties is likely to continue.

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  Explanation

  Optimizing or problem solving entails addressing the source of conflict and finding alternative strategies that benefit all parties. It promotes cooperative, positive attitudes that transfer to other organizational behaviors. Hence, optimizing may

  be worth the expenditure of more resources than other strategies because it improves the future relationship of the parties.

• Question 246:

  Which of the following statements is true regarding outsourced business processes?

  A. Outsourced business processes should not be considered in the internal audit universe because the controls are owned by the external service provider.
  B. Generally, independence is improved when the internal audit activity reviews outsourced business processes.
  C. The key controls of outsourced business processes typically are more difficult to audit because they are designed and managed externally.
  D. The system of internal controls may be better and more efficient when the business process is outsourced compared to internally sourced.
  D. The system of internal controls may be better and more efficient when the business process is outsourced compared to internally sourced.

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  Explanation

• Question 247:

  Organizations mat adopt just-in-time purchasing systems often experience which of the following?

  A. A slight increase in carrying costs.
  B. A greater need for inspection of goods as the goods arrive.
  C. A greater need for linkage with a vendor s computerized order entry system.
  D. An increase in the number of suitable suppliers
  C. A greater need for linkage with a vendor s computerized order entry system.

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  Explanation

• Question 248:

  An organization has outsourced its payroll function to a third-party service provider. Which of the following contract clauses is most important to include in the outsourcing agreement to ensure access to records of the third-party provider?

  A. A termination clause.
  B. A right-to-audit clause.
  C. A confidentiality clause
  D. A data security accountability clause
  B. A right-to-audit clause.

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  Explanation

• Question 249:

  With the shift in some countries' economies toward service industries, a new form of organization has developed. This organization structure is referred to as the professional bureaucracy. While this structure resembles the machine bureaucracy which relies on standardized work processes) in several respects, it is different in one key aspect. This significant difference is that in a professional bureaucracy:

  A. Senior management has had to give up a substantial amount of control.
  B. Tasks are accomplished with a high degree of efficiency.
  C. There is strict adherence to rules.
  D. There is a tendency for subunit conflicts to develop.
  A. Senior management has had to give up a substantial amount of control.

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  Explanation

  A professional bureaucracy e.g., a university or library) is a complex and formal but decentralized organization in which highly trained specialists have great autonomy. The jobs performed by these professionals require years of education and training. By their nature, such jobs can be performed effectively only if the employees are afforded substantial autonomy.

• Question 250:

  An organization that produces backpacks of standard quality is considering manufacturing high-quality packs. Which of the following costs is most relevant when deciding whether to manufacture the new product?

  A. Fixed costs.
  B. Variable costs.
  C. Conversion costs.
  D. Incremental costs.
  D. Incremental costs.

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  Explanation