IIA IIA-CRMA-ADV Study Guide Archives Updated on Apr 15, 2024
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NEW QUESTION # 152
With regard To IT governance, which of the following is the most effective and appropriate role for the internal audit activity?
- A. Independently evaluate the skills and experience of potential chief information officer candidates to assess the best fit based on the organization's risk appetite.
- B. Assist management in interpreting complex IT-related privacy and security risk exposures and evaluating potential mitigation strategies.
- C. Assess whether governance activities are aligned with the organization's risk appetite and take into consideration emerging risks.
- D. Evaluate the organization's governance standards and assess IT-related activities to identify gaps and develop policies, ensuring alignment with the organization's risk appetite.
Answer: C
NEW QUESTION # 153
Which of the following documents is most appropriate in promoting the objectivity of the internal audit activity?
- A. Personal responsibility policy.
- B. Acceptance of gifts policy.
- C. Risk management framework.
- D. Usage of IT system policy.
Answer: B
NEW QUESTION # 154
A chief audit executive (CAE) of an international charity reports functionally to the audit committee of the board of directors and administratively to the charity's chief financial officer (CFO).
Which of the following would impair the internal audit function's independence?
- A. The CFO provides feedback on the CAE's audit reports.
- B. The CFO determines the scope of internal audit work in the accounting department.
- C. The CFO administers the annual evaluation process for the internal auditors.
- D. The CFO manages the accounting of the budget for the internal audit function.
Answer: B
NEW QUESTION # 155
The last quality assessment of the internal audit activity identified three areas for improvement: the achievement of audit engagement objectives, quality of work, and staff development. According to IIA guidance, which of the following should be the chief audit executive's primary focus to achieve these recommended improvements?
- A. Engagement supervision.
- B. Demonstrated compliance with procedures.
- C. Employment of tools and techniques.
- D. Due professional care.
Answer: A
NEW QUESTION # 156
An organization's chief audit executive (CAE) determines that the internal audit staff does not have the requisite skills to conduct an audit of the financial derivatives area. Which of the following would be the best course of action for the CAE to follow?
- A. Notify the audit committee of the problem, and assign the most competent auditors on staff to perform the audit engagement.
- B. Outsource the audit engagement to a qualified external auditing firm without burdening the audit committee with the decision.
- C. Determine the requisite knowledge needed, and obtain the proper training for auditors, even if the training will significantly push back the project's timeframe as outlined by the audit committee.
- D. Employ the skills of a financial derivatives expert to consult on the project, and supplement the consulting with a local seminar on financial derivatives.
Answer: D
NEW QUESTION # 157
Which of the following factors should be considered when determining the appropriate combination of manual techniques and computer-assisted audit techniques (CAATs) to be used during an audit?
1. Acceptance of CAATs findings by entity management.
2. Computer knowledge and expertise of the auditor.
3. Time constraints.
4. Level of audit risk.
- A. 2, 3, and 4
- B. 2 and 3 only
- C. 1 and 4
- D. 1, 2, and 3
Answer: A
NEW QUESTION # 158
The director of purchasing, a certified internal auditor (CIA), signs a contract to procure a large order from a supplier whose products provide the best price, quality, and performance. A few days after signing the contract, the supplier presents the CIA with $1, 000 as a gift. Which statement regarding acceptance of the money is correct?
- A. Accepting the money would violate the IIA Code of Ethics.
- B. Accepting the money would be prohibited only if it were non-customary.
- C. Because the CIA is not acting as an internal auditor, accepting the money would be governed only by the organization's code of conduct.
- D. Because the contract was signed before the money was offered, accepting the money would not violate the IIA Code of Ethics.
Answer: A
NEW QUESTION # 159
Which of the following are components of the COSO enterprise risk management framework?
1. Objective setting.
2. External environment.
3. Data collection.
4. Control activities.
- A. 2 and 3 only
- B. 2 and 4 only
- C. 1 and 4 only
- D. 1 and 3 only
Answer: C
NEW QUESTION # 160
Which of the following is a detective control strategy against fraud?
- A. Performing background checks on employees.
- B. Requiring employees to attend ethics training.
- C. Performing a surprise audit.
- D. Implementing a control self-assessment.
Answer: C
NEW QUESTION # 161
Which of the following is not an objective of internal control?
- A. Validation.
- B. Accuracy.
- C. Compliance.
- D. Efficiency.
Answer: A
NEW QUESTION # 162
While reviewing the workpapers of a new auditor, the auditor in charge discovered that additional audit procedures might be necessary. According to IIA guidance, which of the following would be most relevant for the auditor in charge to consider when making this decision?
- A. Resource management.
- B. Coordination.
- C. Engagement supervision.
- D. Due professional care.
Answer: D
NEW QUESTION # 163
A government agency maintains a system of internal control, according to the COSO model, and has made a change to its employee performance reviews and rewards program. This change relates to which of the following components of COSO's internal control framework?
- A. Monitoring activities.
- B. Control environment.
- C. Control activities.
- D. Information and communication.
Answer: B
NEW QUESTION # 164
Which of the following items should the chief audit executive disclose to senior management regarding the results of the internal audit activity's quality assessments?
- A. The internal audit activity's plan for resource allocation.
- B. The qualifications and independence of the assessment Team.
- C. The amount of the organization's potential loss prevented by the risk-based auditing of the internal audit activity.
- D. The number of audits from the annual internal audit plan that were completed last year.
Answer: C
NEW QUESTION # 165
An internal auditor is reviewing employee travel data to identify opportunities to cut costs while ensuring adequate participation at conferences to support the organization's mission. Which of the following pieces of evidence would be sufficient for completing this task?
- A. A log that includes titles of conferences that all employees were invited to attend in the last year, along with the dates of those conferences and average costs per traveler.
- B. A log of employee travel requests, which include the title of each conference, the conference objectives, anticipated dates of travel, and estimated costs.
- C. A log from the last year that includes dates of travel, conference titles, and conference objectives, all of which correspond with employee names and costs per trip.
- D. A log of conferences titles, dates of travel for each employee, and a detailed summary of conference objectives and how they relate to the organization's mission needs.
Answer: C
NEW QUESTION # 166
A multinational organization has asked the internal audit activity to assist in setting up the organization's risk management system. The chief audit executive (CAE) agrees to take on the engagement as a consultant.
Which of the following tasks is appropriate for the CAE to undertake?
- A. Establish the degree of risk appetite for management to accept.
- B. Coordinate and facilitate risk workshops for management to attend.
- C. Set risk indicators and mitigation plans for management to implement.
- D. Determine the number of significant risks for management to report to the board.
Answer: D
NEW QUESTION # 167
A new chief audit executive (CAE) of a large internal audit activity (IAA) is dissatisfied with the current amount and quality of training being provided to the staff and wishes to implement improvements. According to IIA guidance, which of the following actions would best help the CAE reach this objective?
- A. Assign one experienced manager to better coordinate staff training and development activities.
- B. Require that all staff obtain a minimum of two relevant audit certifications.
- C. Perform a gap analysis of the IAA's existing knowledge, skills and competencies.
- D. Engage a consultant to benchmark the IAA's training program against its peers.
Answer: C
NEW QUESTION # 168
Which of the following is not a standard technique that the chief audit executive (CAE) would use to provide evidence of supervisory review of working papers?
- A. The CAE initials and dates every working paper after it has been reviewed.
- B. The CAE prepares a memorandum discussing the results of the working paper review.
- C. The CAE utilizes an external third party to make an objective recommendation after each working paper review.
- D. The CAE completes an engagement working paper checklist.
Answer: C
NEW QUESTION # 169
Which of the following would most likely be considered a red flag for fraud?
- A. A senior manager has been delegating the authority to sign-off on small dollar amount purchases to a subordinate.
- B. An employee with significant personal debt is in charge of handling large wire transfers for the organization.
- C. An organization lacks a whistleblower hotline for reporting suspicious activity.
- D. An employee in charge of payroll disbursements has rotated these duties with several colleagues.
Answer: B
NEW QUESTION # 170
Who is responsible for setting the risk appetite?
- A. Board of directors.
- B. External auditors.
- C. Chief risk officer.
- D. Operations management.
Answer: A
NEW QUESTION # 171
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