IIA-Certified Internal Auditor - Part 2, Conducting the Internal Audit Engagement Set 13

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IIA-Certified Internal Auditor - Part 2, Conducting the Internal Audit Engagement Set 13

Which of the following factors would the auditor in charge be least likely to consider when assigning tasks to audit team members for an engagement?

The amount of experience the auditors have conducting audits in the specific area of the organization. ✘ The availability of the auditors in relation to the availability of key client staff. ✘ Whether the budgeted hours are sufficient to complete the audit within the current scope. ✘ Whether outside resources will be needed, and their availability. ✔

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Answer & Solution

Answer: Option B

Solution:

It provides fallback for IE8.

An organization's internal audit plan includes a recurring assurance review of the human resources (HR) department. Which of the following statements is true regarding preliminary communication between the auditor in charge (AIC) and the HR department?
1. The AIC should notify HR management when the draft audit plan is being developed, as a courtesy.
2. The AIC should notify HR management before the planning stage begins.
3. The AIC should schedule formal status meetings with HR management at the start of the engagement.
4. The AIC should finalize the scope of the engagement before communicating with HR management.

1 and 3 ✘ 1 and 4 ✘ 2 and 3 ✘ 2 and 4 ✔

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Answer & Solution

Answer: Option B

Solution:

It provides fallback for IE8.

The final internal audit report should be distributed to which of the following individuals?

Audit client management only ✘ Executive management only ✘ Audit client management, executive management, and others approved by the chief audit executive. ✘ Audit client management, executive management, and any those who request a copy. ✔

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Answer & Solution

Answer: Option B

Solution:

It provides fallback for IE8.

According to IIA guidance, which of the following individuals should receive the final audit report on a compliance engagement for the organization's cash disbursements process?

The accounts payable supervisor, accounts payable manager, and controller. ✘ The accounts payable manager, purchasing manager, and receiving manager. ✘ The accounts payable supervisor, controller, and treasurer. ✘ The accounts payable manager, chief financial officer, and audit committee. ✔

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Answer & Solution

Answer: Option B

Solution:

It provides fallback for IE8.

If observed during fieldwork by an internal auditor, which of the following activities is least important to communicate formally to the chief audit executive?

Acts that may endanger the health or safety of individuals. ✘ Acts that favor one party to the detriment of another. ✘ Acts that damage or have an adverse effect on the environment. ✘ Acts that conceal inappropriate activities in the organization. ✔

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Answer & Solution

Answer: Option B

Solution:

It provides fallback for IE8.

An internal auditor submitted a report containing recommendations for management to enhance internal controls related to investments. To follow up, which of the following is the most appropriate action for the internal auditor to take?

Observe corrective measures. ✘ Seek a management assurance declaration. ✘ Follow up during the next scheduled audit. ✘ Conduct appropriate testing to verify management responses. ✔

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Answer & Solution

Answer: Option B

Solution:

It provides fallback for IE8.

Which of the following would most likely cause an internal auditor to consider adding fraud work steps to the audit program?

Improper segregation of duties. ✘ Incentives and bonus programs. ✘ An employee's reported concerns. ✘ Lack of an ethics policy. ✔

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Answer & Solution

Answer: Option B

Solution:

It provides fallback for IE8.

Which of the following recommendations made by the internal audit activity (IAA) is most likely to help prevent fraud?

A review of password policy compliance found that employees frequently use the same password more
than once during a year. The IAA recommends that the access control software reject any password
used more than once during a 12-month period. ✘ A review of internal service-level agreement compliance in financial services found that requests forinformation frequently are fulfilled up to two weeks late. The IAA recommends that the financial services
unit be eliminated for its ineffectiveness. ✘ A vacation policy compliance review found that employees frequently leave on vacation before theirleave applications are signed by their manager. The IAA recommends that the manager attend to the
leave applications in a more timely fashion. ✘ A review of customer service-level agreements found that orders to several customers are frequentlydelivered late. The IAA recommends that the organization extend the expected delivery time advertised
on its website. ✔

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Answer & Solution

Answer: Option B

Solution:

It provides fallback for IE8.

An organization's board would like to establish a formal risk management function and has asked the chief audit executive (CAE) to be involved in the process. According to IIA guidance, which of the following roles should the CAE not undertake?

Manage and coordinate risk management processes. ✘ Audit risk management processes. ✘ Become involved in risk oversight committees, monitoring activities, and status reporting. ✘ Accept management's responsibility for risk management without board approval. ✔

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Answer & Solution

Answer: Option B

Solution:

It provides fallback for IE8.

10.

When creating the internal audit plan, the chief audit executive should prioritize engagements based primarily on which of the following?

The last available risk assessment. ✘ Requests from senior management and the board. ✘ The longest interval since the last examination of each audit universe item. ✘ The auditable areas required by regulatory agencies. ✔

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Answer & Solution

Answer: Option B

Solution:

It provides fallback for IE8.

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IIA-Certified Internal Auditor - Part 2, Conducting the Internal Audit Engagement Set 13

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