IIA IIA Certifications IIA-CIA-PART2 Questions & Answers

• Question 571:

  Which of the following trends found on financial reports would most likely indicate a possible problem?

  A. A material decrease in the receivables turnover.

  B. A material increase in inventory turnover.

  C. A material increase in daily sales compared to total outstanding receivables.

  D. A material increase in the acid-test ratio.

  Correct Answer: A

• Question 572:

  Which of the following situations would best support the decision of a chief audit executive (CAE) to defer follow-up activity at a branch office until the next audit engagement?

  A. An audit of the branch office is routinely scheduled every three years.

  B. On-site follow-up of a remote branch may not be feasible due to travel costs.

  C. Branch office management states that correction of the audit issue may take longer than expected.

  D. The CAE and management agree that the corrective action taken to date is sufficient.

  Correct Answer: D

• Question 573:

  In which of the following situations would it be most appropriate to employ the services of a forensic specialist?

  A. Detection of unauthorized changes to source documents.

  B. Review for misapplication of general computer controls over accounts receivable.

  C. Investigation of ghost employees in a large business.

  D. Verification of fixed assets in a manufacturing company.

  Correct Answer: A

• Question 574:

  The following is an excerpt from an audit engagement workpaper: A Company Accounts Receivable Date

  Objective. To determine if the computer system is correctly recording all accounts receivable transactions.

  Procedures: Judgmental selection of a sample of all accounts receivable balances greater than $50,000 for positive confirmation of balances.

  Conclusion: Based on the results of testing wherein all but three confirmations were returned, the accounts receivable balance is fairly presented in all material respects.

  Which of the following is true regarding the workpaper?

  A. It is not appropriate to judgmentally select a sample when testing accounts receivable.

  B. A conclusion should be reached only for the results of overall testing, not for individual procedures.

  C. The audit procedures used are not consistent with the audit objective.

  D. The format of the workpaper does not conform to the standard format for workpapers.

  Correct Answer: C

• Question 575:

  If an organization's chief audit executive wants to implement continuous auditing, what is the appropriate order in which key steps should be undertaken?

  I. Identify business applications that require access.

  II. Implement steps to continuously assess risks and controls.

  III. Define objectives of continuous auditing.

  IV.

  Manage and report results.

  A.

  III, I, IV, II.

  B.

  II, I, III, IV.

  C.

  III, I, II, IV.

  D.

  II, III, I, IV.

  Correct Answer: C

• Question 576:

  What does the following scatter gram suggest?

  A. Sales revenue is related to training costs.

  B. The training program is not effective.

  C. Increases in training costs consistently increase sales revenue.

  D. One data point is incorrectly plotted.

  Correct Answer: A

• Question 577:

  New credit policies have been implemented in an automated order-entry system to improve the collection of receivables. Sales management has compiled several examples that show decreased sales and

  delayed order entry, and contends that these examples are a direct result of the new credit-policy constraints. Sales management's data and information provide.

  A. Feedback control data.

  B. Irrelevant and argumentative information.

  C. Evidence that the new credit policies do not meet the stated corporate objective to improve collections.

  D. A statistically valid conclusion about the impact of the new credit policies on customer goodwill.

  Correct Answer: A

• Question 578:

  Which of the following data collection strategies systematically tests the effects of various factors on an outcome?

  A. Content analysis.

  B. Sampling.

  C. Evaluation synthesis.

  D. Modeling.

  Correct Answer: D

• Question 579:

  Which of the following audit procedures is most suitable for verifying that all sales transactions have been recorded?

  A. Observation.

  B. Tracing.

  C. Re-computation.

  D. Vouching.

  Correct Answer: B

• Question 580:

  Which of the following would be an appropriate and effective control self-assessment approach in an organization with an authoritative culture?

  I. Facilitated meeting

  II. Survey

  III.

  Management-produced analysis

  A.

  I only

  B.

  I and III only

  C.

  II and III only

  D.

  I, II, and III

  Correct Answer: C