IIA-CIA-PART2 practice questions 111–120

1. Question 111 · 475 in bank

   Which of the following is an example of the verification of internal documentary evidence?

   • AReviewing a carrier's bill of lading.
   • BReconciling a vendor's month-end statement.
   • CVouching a copy of a sales invoice to receivables.
   • DRecalculating a customer's purchase order.

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   Answer: C

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2. Question 112 · 475 in bank

   Which of the following is true regarding roles and responsibilities in risk management processes?

   • ASetting strategic direction resides with senior management.
   • BOwnership of risks resides with the board.
   • CAcceptance of residual risk resides with executive management level.
   • DIdentifying, assessing, mitigating and monitoring activities on a continuous basis rests with the internal audit activity.

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   Answer: C

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3. Question 113 · 475 in bank

   Which of the following audit planning activities adds the least value in understanding the current risk exposures facing the corporation?

   • AReview of organizational strategic plans and operational plans.
   • BConsultation with senior management and the audit committee.
   • CReview of the external auditor's risk assessment.
   • DReview of corporate performance reporting and benchmarking.

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   Answer: D

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4. Question 114 · 475 in bank

   The balanced scorecard approach differs from traditional performance measurement approaches because it adds which of the following measures? I. Financial measures. II. Internal business process measures. III. Client satisfaction measures. IV. Innovation and learning measures.

   • AI only
   • BII and IV only
   • CIII and IV only
   • DII, III, and IV only

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   Answer: D

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5. Question 115 · 475 in bank

   Which of the following is not a primary purpose for conducting a walk-through during the initial stages of an assurance engagement?

   • ATo help develop process maps.
   • BTo determine segregation of duties.
   • CTo identify residual risks.
   • DTo test the adequacy of controls.

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   Answer: D

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6. Question 116 · 475 in bank

   The internal audit activity's primary responsibility in a review or examination of the organization by an external regulatory body is to:

   • AVerify that regulatory reviews occur with adequate frequency.
   • BProvide follow-up to determine if the regulator's findings are appropriately resolved by management.
   • CPrepare documentation for the regulator.
   • DDocument the responses to the regulator's findings.

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   Answer: B

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7. Question 117 · 475 in bank

   After the team member who specialized in fraud investigations left the internal audit team, the chief audit executive decided to outsource fraud investigations to a third party service provider on an as needed basis. Which of the following is most likely to be a disadvantage of this outsourcing decision?

   • ACost.
   • BIndependence.
   • CFamiliarity.
   • DFlexibility.

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   Answer: C

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8. Question 118 · 475 in bank

   Management requested the chief audit executive (CAE) to include an audit of the organization's health and safety program in next year's annual audit plan. However, the internal audit department has no expertise in this area. Which of the following would be the most appropriate action by the CAE?

   • AWith management's agreement, amend the scope of the audit to ensure that areas examined do not require specialized knowledge and expertise.
   • BMeet with management to explain that the audit cannot be undertaken and discuss alternative strategies that can be implemented until internal audit can develop its capability in the area.
   • CAccept the request provided management has conducted a thorough risk assessment prior to the engagement to help guide the audit.
   • DAdvise management that compliance audits of this type should only be conducted by the corresponding regulatory agency to ensure independence.

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   Answer: B

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9. Question 119 · 475 in bank

   Under what circumstances would internal audit not become involved when intentional misconduct is suspected?

   • AManagement is involved in wrongdoing.
   • BManagement is running a parallel investigation.
   • CManagement does not believe a trusted employee could be guilty.
   • DManagement does not maintain strong internal controls.

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   Answer: B

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10. Question 120 · 475 in bank

    Which of the following is true of engagement recommendations? I. Specific suggestions for implementation must be included. II. The internal auditor's observations and conclusions may serve as the basis. III. Actions to correct existing conditions or improve operations may be included. IV. Approaches to correcting or enhancing performance may be suggested.

    • AI only
    • BIII only
    • CI, III, and IV only
    • DII, III, and IV only

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    Answer: D

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IIA-CIA-PART2 practice, question 111. 475 questions available.