IIA IIA Certifications IIA-CIA-PART2 Questions & Answers

• Question 201:

  Which of the following is a justifiable reason for omitting advance client notice when planning an audit engagement?

  A. Advance notice may result in management making corrections to reduce the number of potential deficiencies.

  B. Previous management action plans addressing prior internal audit recommendations remain incomplete.

  C. The engagement includes audit assurance procedures such as sensitive or restricted asset verifications.

  D. The audit engagement has already been communicated and approved through the annual audit plan.

  Correct Answer: C

• Question 202:

  Which of the following is a detective control for managing the risk of fraud?

  A. Awareness of prior incidents of fraud.

  B. Contractor non-disclosure agreements.

  C. Verification of currency exchange rates.

  D. Receipts for employee expenses.

  Correct Answer: C

• Question 203:

  Which of the following is an appropriate responsibility for the internal audit activity with regard to the organization's risk management program?

  A. Identifying and managing risks in line with the entity's risk appetite.

  B. Ensuring that a proper and effective risk management process exists.

  C. Attaining an adequate understanding of the entity's key mitigation strategies.

  D. Identifying and ensuring that appropriate controls exist to mitigate risks.

  Correct Answer: C

• Question 204:

  According to IIA guidance, which of the following actions might place the independence of the internal audit function in jeopardy?

  A. Having no active role or involvement in the risk management process.

  B. Auditing the risk management process for reasonableness.

  C. Coordinating and managing the risk management process.

  D. Participating with management in identifying and evaluating risks.

  Correct Answer: C

• Question 205:

  According to IIA guidance, which of the following would not be a consideration for the internal audit activity (IAA) when determining the need to follow-up on recommendations?

  A. Degree of effort and cost needed to correct the reported condition.

  B. Complexity of the corrective action.

  C. Impact that may result should the corrective action fail.

  D. Amount of resources required to conduct the follow-up activities.

  Correct Answer: D

• Question 206:

  During the quarterly review of the internal audit activity's performance, the chief audit executive (CAE) notes that actual engagement hours consistently exceed the budget. Which of the following strategies would most likely help the CAE address this problem?

  1.

  The budget should consider time spent on similar engagements.

  2.

  The budget should consider the proficiency of the assigned auditors.

  3.

  The budget estimate should provide for unexpected delays.

  4.

  The budget should be specific as to time for each work assignment.

  A. 1 and 2 only

  B. 1 and 4 only

  C. 2 and 3 only

  D. 3 and 4 only

  Correct Answer: B

• Question 207:

  The chief audit executive (CAE) of a large retail operation believes that senior management has accepted a level of risk that exceeds the organization's current risk tolerance with respect to a major expansion. The CAE plans to meet with senior management to discuss these concerns. According to IIA guidance, which of the following would be an appropriate course of action in preparation for this meeting?

  1.

  Understand management's basis for the decision.

  2.

  Advise the board of the concern and upcoming meeting.

  3.

  Ascertain which members of management have accepted the risk.

  4.

  Determine if management has the authority to accept the risk.

  A. 1 and 2 only

  B. 1 and 4 only

  C. 2 and 3 only

  D. 3 and 4 only

  Correct Answer: B

• Question 208:

  According to IIA guidance, which of the following are benefits to the internal audit activity when conducting an assurance mapping exercise?

  A. Identification of gaps in risk coverage, and minimization of duplicate assurance efforts.

  B. Identification of gaps in risk coverage, and consolidation of risk reporting efforts.

  C. Resolution of identified testing errors, and minimization of duplicate assurance efforts.

  D. Resolution of identified testing errors, and consolidation of risk reporting efforts.

  Correct Answer: A

• Question 209:

  Which of the following statements is correct regarding the use of a program evaluation and review technique (PERT) model?

  1.

  It makes use of a probability model to arrive at a realistic estimate of time necessary for completion of the audit engagement.

  2.

  It requires that activities are performed in sequence such that each task is completed before the commencement of the next activity.

  3.

  It remains fixed once completed to act as a baseline for measuring the performance of the audit staff following completion of the engagement.

  4.

  It begins with the auditor-in-charge identifying the overall scope and then breaking down the audit engagement into identifiable activity units.

  A. 1 and 3 only

  B. 1 and 4 only

  C. 2 and 3 only

  D. 2 and 4 only

  Correct Answer: B

• Question 210:

  While reviewing the draft report of an audit engagement, the chief audit executive (CAE) is not in agreement with management's acceptance of the potential risk exposure resulting from an observed key control weakness. Which of the following actions by the CAE would be appropriate for addressing this concern?

  1.

  Meet with the auditor-in-charge.

  2.

  Discuss with senior management.

  3.

  Monitor the result of the accepted risk.

  4.

  Report the matter to the board.

  A. 1, 2, and 3 only

  B. 1, 2, and 4 only

  C. 1, 3, and 4 only

  D. 2, 3, and 4 only

  Correct Answer: B