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

IIA IIA-CIA-PART3 Online Questions & Answers

• Question 821:

  According to IIA guidance, which of the following best describes the activities that occur during the conversion phase of an IT project?

  A. Conversion of user requirements into system specifications
  B. Conversion of user requirements into program codes
  C. Conversion of test data into production data
  D. Conversion of data from the old system into the new system
  D. Conversion of data from the old system into the new system

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  Explanation

• Question 822:

  An organization engages in questionable financial reporting practices due to pressure to meet unrealistic performance targets. Which internal control component is most negatively affected?

  A. Monitoring.
  B. Control activities.
  C. Risk assessment.
  D. Control environment.
  D. Control environment.

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  Explanation

• Question 823:

  When management uses the absorption costing approach, fixed manufacturing overhead costs are classified as which of the following types of costs?

  A. Direct product costs.
  B. Indirect product costs.
  C. Direct period costs.
  D. Indirect period costs.
  A. Direct product costs.

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  Explanation

  https://www.investopedia.com/terms/a/absorptioncosting.asp

• Question 824:

  Which of the following IT-related activities is most commonly performed by the second line of defense?

  A. Block unauthorized traffic.
  B. Encrypt data.
  C. Review disaster recovery test results.
  D. Provide independent assessment of IT security.
  C. Review disaster recovery test results.

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  Explanation

• Question 825:

  According to Arthur D Little, a competitor firm that can act independently and sustain itslong-termstatus irrespective of the behavior of others holds which of the following competitive positions?

  A. A dominant position.
  B. A strong position.
  C. A favorable position.
  D. A tenable position.
  B. A strong position.

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  Explanation

  Evaluating a competitor's market position is necessary to judge how and whether to challenge it. A firm in a strong competitive position can act independently and sustain its long-term status irrespective of the behavior of others.

• Question 826:

  According to Maslow's hierarchy of needs theory, which of the following would likely have the most impact on retaining staff, if their lower- level needs are already met?

  A. Social benefits.
  B. Compensation.
  C. Job safety.
  D. Recognition.
  D. Recognition.

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  Explanation

• Question 827:

  An organization has an agreement with a third-party vendor to have a fully operational facility, duplicate of the original site and configured to the organization's needs, in order to quickly recover operational capability in the event of a disaster.

  Which of the following best describes this approach to disaster recovery planning?

  A. Cold recovery plan.
  B. Outsourced recovery plan.
  C. Storage area network recovery plan.
  D. Hot recovery plan.
  D. Hot recovery plan.

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  Explanation

• Question 828:

  What relationship exists between decentralization and the degree, importance, and range of lower-level decision making?

  A. Mutually exclusive relationship.
  B. Direct relationship.
  C. Intrinsic relationship.
  D. Inverse relationship.
  B. Direct relationship.

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  Explanation

  Decentralization refers to the process by which decision-making authority is distributed to lower levels of management within an organization. The degree, importance, and range of decision-making at lower levels are directly related to the

  extent of decentralization.

  Direct Relationship Defined:

  As decentralization increases, more decision-making power is transferred to lower levels of the organization.

  This means that managers and employees at lower levels are empowered to make a broader range of decisions with greater significance.

  The Importance of Lower-Level Decision-Making in a Decentralized Structure:

  A decentralized structure allows lower-level managers to respond quickly to operational issues and make important decisions without seeking approval from top management.

  This enables increased efficiency, innovation, and adaptability in a dynamic business environment.

  IIA's Perspective on Governance and Decision-Making:

  According to the International Professional Practices Framework (IPPF) by the Institute of Internal Auditors (IIA) , internal auditors must assess the governance structure of an organization, which includes understanding how decision-making

  authority is allocated.

  The IIA's Three Lines Model highlights the role of management in decision-making, emphasizing the need for a clear and effective delegation of authority. IIA Standard 2110 ?Governance states that internal auditors must evaluate decision-

  making processes to ensure they align with the organization's objectives and risk management strategies.

  Supporting Business Concepts:

  Decentralized organizations like multinational corporations, franchises, and divisional structures benefit from empowering lower levels with decision-making authority.

  In contrast, centralized organizations retain control at the top, limiting the scope of decisions at lower levels.

  A direct relationship exists because the more decentralized a company is, the greater the responsibility of lower levels in making crucial decisions.

  IIA References:

  IPPF Standards: Standard 2110 - Governance

  IIA's Three Lines Model - Emphasizing clear delegation of authority

  COSO Internal Control Framework - Discusses decentralized decision-making in control environments

  Business Knowledge for Internal Auditing (IIA Study Guide) -Governance and decision-making structure

• Question 829:

  Communication is most likely to be effective when:

  A. The sender carefully considers the receiver's needs.
  B. Sender and receiver concentrate only on verbal messages.
  C. It changes the receiver's attitude.
  D. The receiver monitors the sender's behavior.
  A. The sender carefully considers the receiver's needs.

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  Explanation

  The needs, abilities, and skills of the receiver must be taken into account by the sender. The sender must fit the message to what the receiver can effectively receive or the message will be useless.

• Question 830:

  Which of the following is false with regard to email policies?

  A. Employees may use informal writing because email is often informal in nature.
  B. Employees should understand that the organization has a legal right to monitor the employees' use of the email system.
  C. Filters should be used to protect against spam.
  D. Emails should be concisely written.
  A. Employees may use informal writing because email is often informal in nature.

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  Explanation

  The principles of good writing still apply to emails. Therefore, emails should be written like any other formal communication within the organization.