IIA-CIA-PART2 practice questions 321–330

1. Question 321 · 475 in bank

   A chief audit executive (CAE) is trying to balance the internal audit activity's needs for technical audit skills, budget efficiency, and staff development opportunities. Which of the following would best assist the CAE in achieving this balance?

   • AStrategic sourcing.
   • BLoan staff arrangement.
   • CFlat organizational structure.
   • DHierarchical organizational structure.

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   Answer: A

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2. Question 322 · 475 in bank

   Which of the following situations is most critical for the chief audit executive to report to the board?

   • AThe chief audit executive disagreed with the business unit manager's initial decision to accept a particular risk. Management ultimately agreed to address the risk only after discussing the issue with senior management.
   • BA staff internal auditor had difficulties completing a portion of the audit because management of the area under review was unwilling to cooperate and provide information timely.
   • CThe internal audit activity was restructured, which resulted in a significant change in responsibilities among audit managers and supervisors for some audits.
   • DThe resignation of an internal audit manager during the year caused the chief audit executive to defer a number of audit engagements to the following year.

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   Answer: B

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3. Question 323 · 475 in bank

   The engagement supervisor would like to change the audit program's scope prior to beginning fieldwork. According to IIA guidance, before any change is implemented, what is the most important action that should be undertaken?

   • ADocument in the engagement workpapers the rationale for changing the scope.
   • BConfirm that the scope change would align to the organization's objectives and goals.
   • CConfirm that the internal audit activity continues to have the necessary knowledge and skills.
   • DSeek approval from the chief audit executive for the proposed scope change.

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   Answer: D

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4. Question 324 · 475 in bank

   An organization has a mature control environment but limited internal audit resources. Given this scenario, on which of the following should the internal auditors focus their testing?

   • ADetective compensating controls.
   • BPreventive compensating controls.
   • CDetective key controls.
   • DPreventive key controls.

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   Answer: D

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5. Question 325 · 475 in bank

   An internal auditor suspects that employee turnover is unusually high at the organization's primary manufacturing plant. To investigate this potential issue, which of the following analytical approaches is the auditor likely to use?

   • ARatio analysis.
   • BVertical analysis.
   • CBenchmarking.
   • DCost-benefit analysis.

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   Answer: C

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6. Question 326 · 475 in bank

   Which of the following reasonably represents best practices regarding what should be the level of internal audit resource investment in monitoring and following up on engagement outcomes?

   • ALimited resources should be employed since the actual engagement is already completed and the onus of corrective actions rests with management.
   • BNo resources should be exclusively deployed for that at all, rather it should be planned as part of future engagements in the same area.
   • CResources should only be provided towards this if doing so does not result in depletion of resources for new engagements planned in the current period.
   • DResources should be allocated to this without conditions as long as doing so meets the expectations of management and the judgment of the chief audit executive.

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   Answer: D

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7. Question 327 · 475 in bank

   When addressing the excessive overtime being paid to employees in an organization's customer service call center, which of the following would be most relevant for the internal auditor to use? 1. Confirmation. 2. Trend analysis. 3. External benchmarking. 4. Internal benchmarking.

   • A1, 2, and 3.
   • B1, 2, and 4.
   • C1, 3, and 4.
   • D2, 3, and 4.

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   Answer: D

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8. Question 328 · 475 in bank

   An internal auditor's examination of accounts receivable generates the following results:

   

   What is the projected misstatement for the population if ratio estimation is used?

   • A$84,000
   • B$238,095
   • C$700,000
   • D$2,100,000

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   Answer: C

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9. Question 329 · 475 in bank

   As part of the preliminary survey, an internal auditor sent an internal control questionnaire to the accounts payable function. Based on the questionnaire responses, the auditor determines that there is no established procedure for adding and approving new vendors. What would the auditor do next?

   • ADetermine that this situation is acceptable and focus on more significant issues.
   • BDocument the issue in the draft audit report.
   • CDocument the observation for further follow up when testing the operating effectiveness of controls.
   • DInterview the personnel associated with this observation.

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   Answer: C

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10. Question 330 · 475 in bank

    A chief audit executive's report to the board showed a significant trend of recent audits going over planned budgeted hours. Which of the following factors could cause this trend?

    • APoor engagement supervision.
    • BIneffective board reporting.
    • CUntimely observation follow up and closure.
    • DLimited staff resources.

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    Answer: D

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IIA-CIA-PART2 practice, question 321. 475 questions available.