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

IIA IIA-CIA-PART3 Online Questions & Answers

• Question 441:

  According to a model developed by Arthur D Little, a firm with a better-than-average chance to improve its competitive position is in a

  A. Favorable position.
  B. Dominant position.
  C. Tenable position.
  D. Weak position.
  A. Favorable position.

  ---

  Explanation

  A firm in a favorable position has strengths that it can exploit. Thus, it has better-than average chance to improve its position but is not as well placed as a dominant or strong firm.

• Question 442:

  An organization is projecting sales of 100,000 units, at a unit price of $12. Unit variable costs are $7. If fixed costs are $350,000, what is the projected total contribution margin?

  A. $350,000
  B. $500,000
  C. $850,000
  D. $1,200,000
  B. $500,000

  ---

  Explanation

• Question 443:

  Which of the following is most appropriately placed in the financing section of an organization's cash budget?

  A. Collections from customers.
  B. Sale of securities.
  C. Purchase of trucks.
  D. Payment of debt, including interest.
  D. Payment of debt, including interest.

  ---

  Explanation

• Question 444:

  According to IIA guidance, which of the following statements is true regarding communication of engagement results?

  A. Prior to releasing engagement results to parties outside of the organization, the audit committee must assess the potential risk to the organization, consult with senior management and/or legal counsel, and control dissemination by restricting the use of the results
  B. During an advisory engagement, if a significant governance issue is identified, it must be communicated to senior management and the board
  C. The engagement supervisor is responsible for communicating the final results to the chief audit executive and other parties who can ensure that the results are given due consideration
  D. The audit committee is responsible for reviewing and approving the final engagement communication before issuance and for deciding to whom and how it will be disseminated
  B. During an advisory engagement, if a significant governance issue is identified, it must be communicated to senior management and the board

  ---

  Explanation

  The IIA Standards require that significant governance, risk management, or control issues be communicated to senior management and the board, regardless of whether they arise from assurance or advisory engagements. Option A is

  misleading, as it overstates the audit committee's role. Option C is incorrect because responsibility for final communication lies with the CAE, not the supervisor. Option D is also incorrect since the audit committee does not approve every

  report; that responsibility rests with internal audit leadership.

  IIA Standards - Standard 2440: Disseminating Results.

• Question 445:

  Which of the following statements is true regarding opportunity cost?

  A. It is relevant to management decision making when resources have alternative uses
  B. It is a valuable historical cost tool used for management decision making
  C. It is considered a key fixed cost in incremental analysis
  D. It is an important quantitative factor used to calculate the internal rate of return
  A. It is relevant to management decision making when resources have alternative uses

  ---

  Explanation

• Question 446:

  Which of the following is a source of communication breakdown within an organization due to a sense of superiority by members of a particular culture?

  A. Perceptual problem.
  B. Stereotyping.
  C. Ethnocentrism.
  D. Uncertainty avoidance.
  C. Ethnocentrism.

  ---

  Explanation

  Ethnocentrism is the attitude that one's own group is superior. It is perpetuated through the value structures and nationalistic spirit of the people.

• Question 447:

  Which of the following scenarios illustrates an organization that has become out of balance by focusing too much on efficiency rather than effectiveness?

  A. The job is not completed and resources are wasted.
  B. The job is completed but resources are wasted.
  C. The job is not completed but resources are not wasted.
  D. The job is completed and resources are not wasted.
  C. The job is not completed but resources are not wasted.

  ---

  Explanation

  In the narrowest sense, effectiveness is achievement of objectives. It is contrasted with efficiency, which is the ratio of output to input. In the broadest sense, an organization must achieve its objectives efficiently to be considered effective. When the job is not completed but resources are not wasted, the organization is out of balance by focusing too much on efficiency.

• Question 448:

  Frederick Herzberg postulated a two-factor theory of human behavior that included satisfiers anddissatisfies. Which of the following is adissatisfied?

  A. Promotion to another position.
  B. Salary.
  C. Challenging work.
  D. Responsibility.
  B. Salary.

  ---

  Explanation

  Frederick Herzberg's two-factor theory of human behavior postulates that there are two classes of factors in the job situation. Maintenance of hygiene factors dissatisfiers) are those the presence of which will not especially motivate people but the absence of which will diminish performance. These factors are extrinsic to the work itself. They include supervision, working conditions, interpersonal relations, salary, and status. Motivational factors (satisfiers) are those the absence of which will not diminish performance but the addition or availability of which will motivate employees. Intrinsic to the work itself, these include achievement, recognition, challenging work, advancement, growth in the job, and responsibility.

• Question 449:

  Which of the following actions taken by management would not be effective in motivating an employee to superior performance?

  A. Job enlargement.
  B. Job enrichment.
  C. Job security.
  D. Job rotation.
  C. Job security.

  ---

  Explanation

  Frederick Herzberg's two-factor theory of human behavior postulated that there are two lasses of factors in the job situation. Dissatisfiers maintenance or hygiene factors) are foundin the job context. Their presence will not especially motivate people, but their absence will lead to diminished performance. They include company policy and administration, supervision, working conditions, interpersonal relations, salary, status, and job security.

• Question 450:

  Which of the following is a systems software control?

  A. Restricting server room access to specific individuals.
  B. Housing servers with sensitive software away from environmental hazards.
  C. Ensuring that all user requirements are documented.
  D. Performing of intrusion testing on a regular basis.
  A. Restricting server room access to specific individuals.

  ---

  Explanation