IIA-CIA-Part1

IIA-CIA-Part1 practice questions, page 24 of 47, with answer review and explanations.

Question 116

A chief audit executive (CAE) for a specialty retailer is asked by management to review the controls in place to manage their electronic funds transfer process. The internal audit activity has no experience with similar engagements. What is the most appropriate course of action for the CAE to take?

  1. Plan the engagement and begin fieldwork using existing staff.
  2. Attempt to discourage management from the request.
  3. Hire an outside consulting firm to assist with the engagement.
  4. Defer the audit until current staff can be appropriately trained.

Question 117

Using the internal audit department to coordinate regulatory examiners' efforts is beneficial to the organization because internal auditors can:

  1. Influence regulatory interpretation of law to better match corporate practice.
  2. Recommend changes to the scope of the regulatory examiners' review.
  3. Perform fieldwork for the regulatory examiners and thus shorten the regulatory examiners' review.
  4. Supply evidence of adequate compliance testing through internal audit workpapers and reports.

Question 118

Internal auditors can benefit from a strong relationship with the external auditors because external auditors can:

  1. Provide internal auditors with an independent and knowledgeable viewpoint.
  2. Concur with the internal auditors' reports and thus improve the quality of assurance provided to management.
  3. Increase the effectiveness of internal control sampling techniques.
  4. Assist the internal auditor by providing information obtained from similar audits with other clients.

Question 119

Risk assessments can vary in format, but generally include. I. A description of identified risks. II. Tests of audit controls. III. A system of rating risks. IV. Sample size identification.

  1. I and II only
  2. I and III only
  3. I, III, and IV only
  4. II, III, and IV only

Question 120

Risk assessments are valuable to the internal audit activity's planning process because they assist in:

  1. Eliminating all areas with low risk from the audit plan.
  2. Educating management on the importance of keeping the internal audit activity informed of organizational changes.
  3. Identifying the audit universe or auditable activities that need to be reviewed.
  4. Identifying risks that management and the internal auditors have overlooked.