IIA IIA Certifications IIA-CIA-PART1 Questions & Answers

• Question 221:

  Which of the following is accomplished by the internal audit charter?

  A. It establishes the audit committee's position within the organization.

  B. It authorizes access to records, personnel and physical properties relevant to the performance of engagements.

  C. It defines the scope of internal and external audit activities.

  D. It states the nature of the chief audit executive's administrative reporting relationship with the board.

  Correct Answer: B

• Question 222:

  Which of the following is the responsibility of an internal auditor?

  1.

  Assist operating management in implementing audit recommendations.

  2.

  Provide management with value-added analysis to improve operations.

  3.

  Become an advocate for changes to the internal audit activity charter.

  4.

  Disclose non-financial risks that may be identified during the course of an engagement.

  A. 1 and 3 only

  B. 2 and 4 only

  C. 1, 2, and 4 only

  D. 1, 2, 3, and 4

  Correct Answer: B

• Question 223:

  COBIT is primarily designed to:

  A. Define auditing standards for information technology auditors.

  B. Satisfy information technology regulatory requirements.

  C. Provide guidance to govern information technology activities.

  D. Assist technology professionals in interpreting technological specifications.

  Correct Answer: C

• Question 224:

  Management has decided to invest significant capital in a new and innovative large computer system. They understand that they are one of the first organizations to implement this system, but they believe the benefits outweigh the uncertainty over the performance and reliability of the software. This decision best describes which aspect of risk management?

  A. Risk appetite.

  B. Risk tolerance.

  C. Residual risk.

  D. Inherent risk.

  Correct Answer: A

• Question 225:

  An internal auditor is testing the controls of a large and complex food production process where quality assurance is critical. Management provides process charts and documentation, but the auditor quickly determines that this information is incomplete and out of date. Which of the following would be the most appropriate course of action for the auditor to follow?

  A. Use the documentation but meet with the production supervisor to obtain updated information before proceeding.

  B. Amend the engagement objectives recognizing that important information is not available to protect the engagement's integrity.

  C. Defer the audit until management can provide updated charts and documentation as this is their responsibility.

  D. Use the documentation but use observation during the engagement to provide missing information.

  Correct Answer: A

• Question 226:

  An internal auditor is gathering evidence for an organization's internal audit engagement and requests a sample of vendor invoices from the organization. Which of the following is true regarding the reliability of this evidence?

  A. The invoices have zero reliability.

  B. The invoices have low reliability.

  C. The invoices have medium reliability.

  D. The invoices have high reliability.

  Correct Answer: C

• Question 227:

  Which of the following best describes an appropriate form of working paper standardization?

  A. Uniform cross referencing system.

  B. Customized layouts for each specific audit area.

  C. Comprehensive data lists from information databases.

  D. Audit client review and approval.

  Correct Answer: A

• Question 228:

  An internal auditor is assessing the risk of employees falsifying reimbursement requests for business-related meals or travel. Which of the following procedures would the internal auditor most likely perform first?

  A. Review the supplemental documentation provided for a sample of reimbursement requests.

  B. Interview the payroll/accounting supervisor to determine what controls exist to prevent fraud.

  C. Determine whether or not the payroll/accounting department has been subject to regular review.

  D. Establish a flowchart of the payroll/accounting functions that include any controls currently in place.

  Correct Answer: D

• Question 229:

  A chief audit executive (CAE) is planning to issue an annual report concluding on the overall effectiveness of the organization's internal control system. According to the Standards, which of the following is likely the most significant challenge facing the CAE when creating the report?

  A. The opinion must include difficult to measure risks such as the risks of management override of controls, and collusion among dishonest personnel.

  B. The opinion is dependent on complex analyses of numerous internal audit engagements carried out over the prior year.

  C. The opinion is only issued once a year, limiting its usefulness.

  D. Assessing control effectiveness is complicated by inherent risks.

  Correct Answer: B

• Question 230:

  Which of the following situations would most likely result in the auditor in charge (AIC) recommending that the staff auditor further investigate non-compliant items?

  A. A staff auditor conducted a test of 25 non-statistical sample items, selected judgmentally, and 5 are not in compliance with organizational policy.

  B. A staff auditor conducted a test of 85 non-statistical sample items, selected randomly, and 5 are not in compliance with organizational policy.

  C. Before the staff auditor conducted a test of statistical sample items, the AIC was already aware of underlying control weaknesses.

  D. A staff auditor conducted a test of statistical sample items, the results of which fall below the acceptable error rate by less than one percentage point.

  Correct Answer: A