IIA-CIA-PART2 practice questions 191–200

1. Question 191 · 475 in bank

   Which of the following is a preventive control for fraud?

   • ADetermining if the number of manually prepared disbursement checks is high.
   • BReconciling the purchase orders with the requisitions.
   • CVerifying that new vendors appear on the vendor pre-approved list.
   • DConducting an inventory count of the warehouse.

   Show answer

   Answer: C

   Next question

2. Question 192 · 475 in bank

   Which of the following procedures would be most helpful in providing additional evidence when an auditor suspects that an unidentified employee is submitting and approving invoices for payment?

   • AUse generalized audit software to identify invoices from vendors with post office box numbers or other unusual features. Select a sample of those invoices and trace to supporting documents such as receiving reports.
   • BSelect a sample of payments made during the year and investigate each one for approval.
   • CSelect a sample of receiving reports representative of the period under investigation and trace to approved payment. Note any items not properly processed.
   • DSelect a sample of invoices paid during the past month and trace them to appropriate vendor accounts.

   Show answer

   Answer: A

   Next question

3. Question 193 · 475 in bank

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

   • AActs that may endanger the health or safety of individuals.
   • BActs that favor one party to the detriment of another.
   • CActs that damage or have an adverse effect on the environment.
   • DActs that conceal inappropriate activities in the organization.

   Show answer

   Answer: B

   Next question

4. Question 194 · 475 in bank

   Which of the following conclusions would be appropriate for a beginning auditor performing an audit of a payroll department?

   • AEmployee taxes have been deducted at the correct rates, and the taxes have been forwarded to the appropriate government agency.
   • BAlthough there is insufficient segregation of duties, the impact is mitigated by compensating controls.
   • CThe payroll computer system should be replaced.
   • DThe payroll department staff has the appropriate level of skills.

   Show answer

   Answer: A

   Next question

5. Question 195 · 475 in bank

   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?

   • AObserve corrective measures.
   • BSeek a management assurance declaration.
   • CFollow up during the next scheduled audit.
   • DConduct appropriate testing to verify management responses.

   Show answer

   Answer: D

   Next question

6. Question 196 · 475 in bank

   Which two of the following considerations must an internal auditor take into account while planning an audit of an accounting system/application that has been in use for the last five years? The level and manner of linkages between the business' mission, objectives, and structure and the accounting system/application. Presence or absence of computerized and manual controls that address risks. Identification of risks at the application level, e.g. availability and security of the system. Testing of the system/application for bugs and errors.

   • A1 and 3 only
   • B2 and 3 only
   • C2 and 4 only
   • D3 and 4 only

   Show answer

   Answer: B

   Next question

7. Question 197 · 475 in bank

   Which of the following, if observed, would not indicate the need to extend the search for other indicators of fraud in a purchasing department?

   • AThe standard of living of one of the purchasing agents has increased.
   • BThe internal control structure has significant weaknesses.
   • CThe purchasing agents have convinced management to adopt a policy of paying vendors on a more timely basis in order to avoid incurring penalty charges.
   • DThe cost of goods procured seems to be excessive in comparison with previous years.

   Show answer

   Answer: C

   Next question

8. Question 198 · 475 in bank

   The following audit observation was included in the final audit report: "Our review concluded that bank reconciliation statements for March and April did not show evidence of supervisory review. We recommend strict compliance with the controller's manual, which requires the department head to place their initials on the reconciliation statements to document their review." Which of the following attributes are missing from the above audit observation? 1. Criteria. 2. Condition. 3. Cause. 4. Effect.

   • A1 and 4 only
   • B2 and 3 only
   • C1, 3, and 4 only
   • D3 and 4 only

   Show answer

   Answer: D

   Next question

9. Question 199 · 475 in bank

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

   • AImproper segregation of duties.
   • BIncentives and bonus programs.
   • CAn employee's reported concerns.
   • DLack of an ethics policy.

   Show answer

   Answer: C

   Next question

10. Question 200 · 475 in bank

    During an engagement, an internal auditor discovered that an organizations policy on delegation of authority listed six individuals who were no longer employed with the organization. In addition, four individuals acting with disbursement authority were not identified in the policy as having such authority. Which of the following is the most effective course of action to address the control weakness?

    • AImmediately initiate a complete audit of the disbursement function to determine if significant frauds have occurred.
    • BRecommend that management review the process supporting the policy and make improvements.
    • CAdvise management to add the four additional names and remove the incorrect names from the policy to make it current.
    • DReview further to ensure that the four individuals do not have the appropriate authority through delegation.

    Show answer

    Answer: B

    Next question

Keyboard:J Kmove between questionsA–Dselect an answerRshow or hide the answer← →change page

IIA-CIA-PART2 practice, question 191. 475 questions available.