IIA IIA Certifications IIA-CIA-PART2 Questions & Answers

• Question 521:

  If an auditor used nonstatistical sampling instead of statistical sampling to estimate the value of inventory, which of the following would be true?

  A. The confidence level could not be quantified.

  B. The precision would be larger.

  C. The projected value of inventory would be less reliable.

  D. The risk of incorrect acceptance would be higher.

  Correct Answer: A

• Question 522:

  Which of the following audit techniques provides for continuous monitoring and analysis of computer transactions for detailed auditing?

  A. Integrated test facility.

  B. Parallel simulation.

  C. Test data.

  D. Embedded audit routines.

  Correct Answer: D

• Question 523:

  Access control software on an organization's mainframe computer records detailed information concerning both successful and unsuccessful log-on attempts to applications. Which of the following audit tools would be best suited to review the access information that has been recorded?

  A. Generalized audit software.

  B. Flowcharting.

  C. Integrated test facility.

  D. Test data.

  Correct Answer: A

• Question 524:

  Which of the following would provide the greatest assurance of the accuracy of a computer program's computation of freight charges for catalog sales?

  A. Use discovery sampling, selecting transactions from invoices which should have freight charges added to them.

  B. Use either test data or parallel simulation to test the computer application.

  C. Use difference estimation, selecting transactions from invoices which should have freight charges added to them.

  D. Use generalized audit software to select a monetary-unit sample of invoices that have been billed to customers.

  Correct Answer: B

• Question 525:

  Which of the following audit steps would be most effective to review proper recording of and accountability over physical assets?

  I. Physically inspect all assets on the organization's property.

  II. Select a sample department and physically inspect assets in the department.

  III. Select a sample from the organization's records of physical assets and physically locate each asset.

  IV.

  Identify assets at a sample of locations and trace to the organization's records.

  A.

  I only

  B.

  I and IV only

  C.

  II and III only

  D.

  III and IV only

  Correct Answer: D

• Question 526:

  An internal audit activity is participating in the due diligence work for an acquisition that a company is considering. One engagement objective is to determine if the acquisition's accounts payable contain all outstanding liabilities. Which of the following audit procedures would not be relevant for this objective?

  A. Examine supporting documentation of subsequent (after-period) cash disbursements and verify period of liability.

  B. Send confirmations, including zero-balance accounts, to vendors with whom the company normally does business.

  C. Select a sample of accounts payable from the accounts payable list and verify the supporting receiving reports, purchase orders, and invoices.

  D. Trace receiving reports issued before the period end to the related vendor invoices and accounts payable list.

  Correct Answer: C

• Question 527:

  An auditor receives anonymous information that fraud is occurring in the operation being audited, but no details are given as to the type of fraud or the individuals involved. There are several areas in which fraud could occur. The auditor should:

  A. Identify the area that has the greatest volume of transactions and design a sampling plan for substantive testing.

  B. Apply analytical procedures to areas that might be impacted by possible fraudulent activities.

  C. Interview employees to identify areas where the fraud could be occurring.

  D. Plan detailed tests of the areas that have the highest dollar amount of transactions.

  Correct Answer: B

• Question 528:

  A company has recently incurred significant cost overruns on one of its construction projects. Management suspects that these overruns were caused by the contractor improperly accounting for costs related to contract change orders. Which of the following procedures would be appropriate for testing this suspicion?

  I. Verify that the contractor has not charged change orders with costs that have already been billed to the original contract.

  II. Determine if the contractor has billed for original contract work that was canceled as a result of change orders.

  III.

  Verify that the change orders were properly approved by management.

  A.

  I only

  B.

  III only

  C.

  I and II only

  D.

  I and III only

  Correct Answer: C

• Question 529:

  A retail company uses a computer program that matches electronic vendor invoices with the applicable purchase orders and receiving information, which are also maintained electronically.

  If an invoice does not match the other items within predefined ranges, a report is generated and sent to the accounts payable department for further investigation. All of the applicable documents are electronically marked, cross-referenced, and retained in open files. Both an integrated test facility and a systems control audit review file (SCARF) have been included in the system.

  An auditor wants to determine the extent to which items are not matched at year end and to investigate the potential causes of the unmatched items. Which of the following audit procedures would be most effective in determining the items to investigate?

  A. Use generalized audit software to read the electronically marked unmatched items.

  B. Use generalized audit software to read the purchase orders and trace to applicable receiving and vendor invoice files.

  C. Use the SCARF to identify unusual items. Select an attributes sample and trace to the underlying documentation.

  D. Submit test data to identify attributes of unmatched items. Follow up by investigating the identified attributes.

  Correct Answer: A

• Question 530:

  Which of the following processes real-transaction data through auditor-developed test programs?

  A. Generalized audit software.

  B. Tracing.

  C. Parallel simulation.

  D. Mapping.

  Correct Answer: C