IIA IIA Certifications IIA-CIA-PART1 Questions & Answers

• Question 501:

  Which of the following steps would not be included in a program of selecting and developing human resources for an internal audit department?

  A. Scheduling periodic meetings with individual auditors, during which the chief audit executive provides counsel regarding each auditor's performance and professional career development.

  B. Establishing an internal review team to assess the auditors' and audit department's compliance with standards, level of audit effectiveness, and compliance with departmental policy.

  C. Developing specific job descriptions for audit staff, audit managers, and other auditing positions.

  D. Establishing in-house training programs and requiring continuing education for audit staff.

  Correct Answer: B

• Question 502:

  In advance of a preliminary survey, a chief audit executive sends a memorandum and questionnaire to the supervisors of the department to be audited. What is the most likely result of that procedure?

  A. It creates apprehension about the audit engagement.

  B. It involves the engagement client's supervisory personnel in the audit.

  C. It is an uneconomical approach to obtaining information.

  D. It is only useful for audits of distant locations.

  Correct Answer: B

• Question 503:

  Which of the following best describes the most important criteria when assigning responsibility for specific tasks required in an audit engagement?

  A. Auditors must be given assignments based primarily upon their years of experience.

  B. All auditors assigned an audit task must have the knowledge and skills necessary to complete the task satisfactorily.

  C. Tasks must be assigned to the audit team member who is most qualified to perform them.

  D. All audit team members must have the skills necessary to satisfactorily complete any task that will be required in the audit engagement.

  Correct Answer: B

• Question 504:

  To assure that the technical proficiency of internal auditors is appropriate for the audit engagements to be performed, a chief audit executive should:

  A. Consider the scope of work and level of responsibility when establishing criteria for education and experience in filling internal auditing positions.

  B. Ensure that each newly hired auditor is qualified in all of the disciplines needed to accomplish the department's audit mission.

  C. Oversee a training program that matches the actual training provided with the interests of individual auditors.

  D. Require all of the audit staff to pursue a minimum number of continuing professional education hours each year.

  Correct Answer: A

• Question 505:

  It would be appropriate for an internal audit activity to use consultants with expertise in health- care benefits when the internal audit activity is:

  I. Conducting an audit of the organization's estimate of its liability for post retirement benefits, which include health care benefits.

  II. Comparing the cost of the organization's health care program with that of other programs offered in the industry.

  III.

  Training its staff to conduct an audit of health care costs in a major division of the organization.

  A.

  I only

  B.

  I and III only

  C.

  II and III only

  D.

  I, II, and III.

  Correct Answer: D

• Question 506:

  In a manufacturing organization, all sales prices are determined centrally and are electronically sent to the distribution centers to update their sales price tables. Any pricing deviations must be approved by central headquarters. To determine how this process is functioning, an internal auditor should:

  A. Document the flow of sales price information, and determine how the table is accessed and updated.

  B. Develop a flowchart of the sales order process to determine how orders are taken and priced.

  C. Identify who approves the shipment of goods and how the goods are priced.

  D. Obtain a copy of the existing flowchart for the computer program to determine how price data are accessed.

  Correct Answer: A

• Question 507:

  To determine if a new computer system is improving the use of a manufacturer's limited facilities in serving the largest number of customers, an auditor should compare.

  A. The number of reworked orders and their costs before and after system installation.

  B. Inventory and materials handling costs before and after system installation.

  C. The number of orders filled and their cycle times before and after system installation.

  D. The number of reworked orders and orders filled before and after system installation.

  Correct Answer: C

• Question 508:

  An auditor for a large wholesaler is evaluating the controls over the approval and oversight of credit sales. Which of the following procedures would be a control weakness?

  A. The credit department is responsible for approving shipments to all customers.

  B. The finance committee of the board of directors periodically reviews credit standards.

  C. Customers who fail to meet credit requirements must pay cash for shipments upon delivery.

  D. The sales department is responsible for determining the credit ratings of customers.

  Correct Answer: D

• Question 509:

  Which of the following would be the best source of information for a chief audit executive to use in planning future audit staff requirements?

  A. Discussions of audit needs with executive management and the audit committee.

  B. Review of audit staff education and training records.

  C. Review of audit staff size and composition of similar-sized companies in the same industry.

  D. Interviews with existing audit staff.

  Correct Answer: A

• Question 510:

  Which of the following would be most effective in determining if the percentage of medication orders containing errors improved after a hospital installed a computerized medication-tracking system?

  A. Compare the proportion of erroneous medication orders before and after system installation for similar periods.

  B. Compare the number of errors before and after system installation for similar periods.

  C. Compare, after adjusting for the number of patients, the proportion of erroneous medication orders before and after system installation.

  D. Compare, after adjusting for the number of patients, the number of errors before and after system installation for similar periods.

  Correct Answer: A