IIA-CIA-Part1

IIA-CIA-Part1 practice questions, page 32 of 47, with answer review and explanations.

Question 156

When performing benchmarking during the planning phase of a performance audit, an internal auditor should:

  1. Determine the current performance gap.
  2. Project future performance levels.
  3. Develop functional action plans.
  4. Identify comparative organizations.

Question 157

A major difference between enterprise risk management and traditional risk management lies in the narrow focus of traditional risk management on: I. Property and liability risks. II. Risks with insurance solutions. III. Risks impacting organizational objectives.

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

Question 158

An internal audit activity encounters a scope limitation from senior management that will affect its ability to meet its goals and objectives for a potential engagement client. The nature of the scope limitation should be.

  1. Noted in the audit workpapers, but the engagement should be carried out as scheduled, with any necessary adjustments made based on the scope limitation.
  2. Communicated to the external auditors so that they can investigate the area in more detail.
  3. Communicated, preferably in writing, to the board.
  4. Communicated to management, stating that the limitation will not be accepted because it would impair the audit activity's independence.

Question 159

Which statement most accurately describes how criteria are established for use by internal auditors in determining whether goals and objectives have been accomplished?

  1. Management is responsible for establishing the criteria.
  2. Internal auditors should use professional standards or government regulations to establish the criteria.
  3. The industry in which a company operates establishes criteria for each member company through benchmarks and best practices for that industry.
  4. Appropriate accounting or auditing standards, including international standards, should be used as the criteria.

Question 160

A company has established its environmental audit activity as part of its legal department rather than part of its internal audit activity, which reports to the audit committee. The board has requested that the chief audit executive (CAE) provide an annual opinion on whether environmental risks are being properly addressed. In these circumstances, the CAE should recommend to the audit committee that the internal audit activity:

  1. Review the recommendations in all environmental audit reports.
  2. Discuss with the environmental auditors the results of their reviews.
  3. Periodically carry out a quality assessment of the environmental audit activity.
  4. Include a review of environmental issues in some internal audit engagements.