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

IIA IIA-CIA-PART3 Online Questions & Answers

• Question 711:

  An organization uses a database management system (DBMS) as a repository for dat Some of the applications update the database. Which of the following is the most important control related to the integrity of the data in the database?

  A. The DBMS, in turn, supports a number of end-user developed applications which were created using fourth-generation programming languages.
  B. End users have their read-only applications approved by the information systems department
  C. Concurrency update controls are in place.
  D. End-user applications are developed on personal computers before being implemented on the mainframe.
  E. A hierarchical database model is adopted so that multiple users can be served at the same time.
  C. Concurrency update controls are in place.

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  Explanation

• Question 712:

  Which particular type of organization structure will likely have unity-of-command problems unless there is frequent and comprehensive communication between the various functional and project managers?

  A. Line and staff.
  B. Strategic business unit.
  C. Centralized.
  D. Matrix.
  D. Matrix.

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  Explanation

  A matrix structure allows authority to flow both vertically and horizontally. A manager is appointed for each project and draws on personnel who are organized by function and report to a manager for each function. This violates the principle of unity of command, which states that each subordinate should have only one superior.

• Question 713:

  A structural characteristic of an emerging industry is:

  A. Strategic uncertainty.
  B. Customers are sophisticated.
  C. Technological uncertainty has been overcome.
  D. Industry development is unlimited.
  A. Strategic uncertainty.

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  Explanation

  Strategic uncertainty arises because effective strategies have not yet been identified. Hence, firms are experimenting with product features, production methods, marketing approaches, etc. Moreover, competitive intelligence is necessarily poor because competitors have not been identified and industry sales and other data are not available.

• Question 714:

  Which of the following statements about matrix organizations is false?

  A. In a matrix organization, conflict between functional and product managers may arise.
  B. In a matrix organization, staff under dual command is more likely to suffer stress at work.
  C. Matrix organizations offer the advantage of greater flexibility.
  D. Matrix organizations minimize costs and simplify communication.
  D. Matrix organizations minimize costs and simplify communication.

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  Explanation

• Question 715:

  The method of principled negotiation is based on which of the following principles?

  A. Separate the people from the problem. II. Focus on positions, not interests. III. Invent options for mutual gain. IV. Insist on using subjective criteria.
  B. I and II only.
  C. I and Ill only.
  D. I, II, and Ill only.
  E. II, Ill, and IV only.
  B. I and II only.

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  Explanation

  The principled negotiation method focuses on basic interests, mutually satisfying options, and fair standards. The basic principles include (1) separating the people from the problem; (2) focusing on interests, not positions; (3) inventing options for mutual gain; and (4) insisting on using objective criteria.

• Question 716:

  The opportunity for franchising comes from the ability to:

  A. Develop products.
  B. Differentiate products.
  C. Standardize products.
  D. Diversify products.
  C. Standardize products.

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  Explanation

  Standardizing products means to maintain the same product or to standardize the production, operations, and facilities in different locations or markets. Franchises all use standardized products to reduce costs.

• Question 717:

  Employees of an organization noticed that an exterior surface of the office building was deteriorating. Upon investigation, it was found that the deterioration was caused by harsh cleaning chemicals used to remove excessive bird droppings, and that the birds were drawn to the building to feed from a spider infestation.

  Which of the following best represents a root cause-based recommendation for this situation?

  A. Repair the surface of the building
  B. Discontinue the use of the cleaning chemicals
  C. Scare the birds away by installing scarecrows
  D. Enhance cleaning of the building to displace spiders
  D. Enhance cleaning of the building to displace spiders

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  Explanation

  A root cause-based recommendation addresses the underlying problem rather than symptoms. In this case, the real issue is the spider infestation, which attracts the birds, which in turn leads to droppings that require harsh cleaning. By

  enhancing cleaning and displacement of spiders, the organization eliminates the root cause and prevents recurrence.

  Options A, B, and C treat symptoms but do not address the true root cause.

  IIA Practice Guide - Audit Findings: Condition, Criteria, Cause, Effect, and Recommendation.

• Question 718:

  Which of the following statements is true regarding multi-report summaries for members of senior management and the board?

  A. Multi-report summaries should be used to describe the work performed by the internal audit function
  B. In developing multi-report summaries, internal auditors should use multi-row and multi-column tables
  C. Multi-report summaries are not useful to boards that see every engagement report
  D. Multi-report summaries are readily developed if each finding is rated
  D. Multi-report summaries are readily developed if each finding is rated

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  Explanation

  Multi-report summaries are designed to provide senior management and the board with aggregated results across multiple audit engagements. To make them effective, internal audit functions typically rate findings (e. g., high, medium, low)

  so results can be compared and summarized efficiently.

  Option A is incomplete because summaries are not just about describing audit work but about presenting meaningful insights. Option B (tables) refers to presentation style, not the key principle. Option C is incorrect because even if boards

  review individual reports, summaries provide strategic insights across engagements.

  Thus, the correct answer is Option D.

  IIA Practice Guide - Formulating and Expressing Internal Audit Opinions.

• Question 719:

  The prospect for the long-term profitability of an existing firm is greater when:

  A. The firm operates in an industry with a steep learning curve in its production process.
  B. The costs of switching suppliers is low.
  C. New entrants are encouraged by government policy.
  D. Distribution channels are willing to accept new products.
  A. The firm operates in an industry with a steep learning curve in its production process.

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  Explanation

  The prospects of long-term profitability are contingent upon the industry's exit and entry barriers. The entry of new firms in a market decreases the prospect for long-term profitability. When a firm operates in an industry that has a steep learning curve, it is more difficult for new firms to enter the market. Thus, the prospects of long-term profitability are greater for an existing firm.

• Question 720:

  What must be monitored in order to manage risk of consumer product inventory obsolescence?

  1. Inventory balances.

  2. Market share forecasts.

  3. Sales returns.

  4. Sales trends.

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

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  Explanation