IIA IIA Certifications IIA-CGAP Questions & Answers

• Question 111:

  In the U.S., _________ certainly has expanded the amount of documented procedures for auditors to review. In addition to ________, auditors also access information that might otherwise be exempt from public disclosure. Protecting the confidential status of information during the audit process and after the release of an audit is very important.

  A. Freedom of speech, private documents

  B. Freedom of information legislation, public documents

  C. Freedom of information legislation, private documents

  D. Freedom of speech, public documents

  Correct Answer: B

• Question 112:

  Who gather and analyze information and control structures in order to evaluate whether public agencies are accomplishing their objectives or not?

  A. Controllers

  B. Planners

  C. Auditors

  D. Leaders

  Correct Answer: C

• Question 113:

  Freedom of information legislation has set the tone for public officials that all decisions and actions are subject to review. ________and ________require that all official meetings are publicized and the general public is invited so that individuals interested in public affairs might attend.

  A. Regulatory laws and open meetings acts

  B. Sunshine laws and open meetings acts

  C. Property laws and open meetings acts

  D. Sunshine laws and closed meetings acts

  Correct Answer: B

• Question 114:

  The right of the public to protect its own interests by seeking information, and also limiting the manner in which personal records can be used, has affected government practices in all of the following areas listed below EXCEPT.

  A. Agency responsibilities -- each agency should provide guidance to the public that describes its policies and procedures and steps required to request information. Upon receiving a valid request, a government agency must provide the relevant record(s) in a prompt, no solicitous manner.

  B. Elected or appointed officials -- sunshine laws have done away with private "behind closed doors" meetings where decisions, which directly impact citizens, were once made.

  C. Confidential or inside information -- using a government position and knowledge of government initiatives to make financial gain. For example, purchasing a piece of property that will be adjacent to a proposed government project.

  D. Customer/client privacy -- some information is exempt from the public, and conversely, individuals have the opportunity to amend any errant information with regard to themselves.

  Correct Answer: C

• Question 115:

  Beyond blatant illegal activities there are more subtle situations that can taint the public's perception of government. All of the following are the areas of ethical concerns EXCEPT:

  A. Disclosure -- if any benefit from an activity is to be accrued by an employee, the relationship and benefit must be disclosed to management prior to the transaction.

  B. Organizational ethics -- the environment or culture of an organization and formal and informal rules of

  conduct. These can also include specific laws and regulations.

  C. Gratuities and kickbacks -- a payment or inducement to promote a specific transaction or procurement activity.

  D. Conflict of interest -- where an employee or family member has a financial interest in procurement activity or government transaction.

  Correct Answer: B

• Question 116:

  All of the following are levels of ethics, each of which has its own sets of responsibilities EXCEPT:

  A. Organizational ethics -- the environment or culture of an organization and formal and informal rules of conduct. These can also include specific laws and regulations.

  B. Personal morality -- the basic sense of right and wrong is a function of social mores, parental influence, religious background, and personal experiences.

  C. Corporate social responsibility or CSR: an umbrella term under which the ethical rights and duties existing between companies and society is debated.

  D. Professional ethics -- professional norms and rules that govern a profession. Some professions, such as auditing, have professional codes of conducts (such as the IIA's Code of Ethics).

  Correct Answer: C

• Question 117:

  The audit committee should be made up of individuals who are independent of the day-to-day management of the public sector entity and who have the necessary program and /or management expertise to perform their review function effectively. The responsibilities of the audit committee should be stated in a _______, _______ or _______that is approved by the full board or governing body of the public sector entity, as appropriate.

  A. Informal, written charter or equivalent document

  B. Legal, written charter or equivalent document

  C. Formal, verbal charter or equivalent document

  D. Formal, written charter or equivalent document

  Correct Answer: D

• Question 118:

  Auditing plays an important role in ensuring accountability. Through its various forms (internal and external), auditing provides a method of control to help ensure that objectives are realized in an appropriate manner. Some broad areas covered by audits include all of the following EXCEPT:

  A. The accuracy and completeness of records.

  B. Compliance with laws, regulations, contract terms, policies, and procedures.

  C. Complexity of objectives.

  D. Economy and efficiency of operations.

  Correct Answer: C

• Question 119:

  _________serves in a unique capacity as an important communication link among external and internal auditors and operating management, and as a means of reducing the risk of management override of key elements of a public sector entity's internal control structure:

  A. The audit committee

  B. Cabinet committees

  C. Official committees

  D. Standing committees

  Correct Answer: A

• Question 120:

  Peter Drucker, one of the foremost authorities on management theory, described why public sector accountability was so critically important. He described all of the following factors that distinguish service organization activities from private- sector activities EXCEPT:

  A. Role of the annual operating budget (as a controlling factor that sets policy, instead of such things as net profit or market share to guide decision-making).

  B. Domination of organization-related legal and contractual provisions

  C. Absence of a significant performance assessment capacity (few governmental entities can be evaluated by a single measure -- profit -- for effectiveness).

  D. Absence of a "harmony of purpose" control factor. Since not every division is working toward the same goal (profit), other means of control must be established to ensure that the principal's interests are the driving motivators.

  Correct Answer: B