IIA-CIA-PART2 practice questions 461–470

1. Question 461 · 475 in bank

   Operational management has asked the chief audit executive (CAE) for access to all workpapers from a recent engagement. According to IIA guidance, which of the following is the CAE's most appropriate response?

   • AApprove the request if access is deemed necessary to explain engagement observations.
   • BDeny the request, as engagement workpapers are intended for use by the internal audit activity.
   • CSeek approval from senior management or the board prior to granting management access to the workpapers.
   • DGrant access only to pertinent workpapers if management agrees to implement the control enhancements recommended by the internal audit activity.

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   Answer: A

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2. Question 462 · 475 in bank

   During an engagement, the chief audit executive (CAE) is notified that the residual risk in several key areas currently exceeds the organization's risk appetite. Upon contacting management, the CAE is advised that no action will be taken, as the existing appetite is unrealistic for current market conditions. According to IIA guidance, which of the following actions would be the most appropriate for the CAE to take?

   • AArrange a meeting with senior management to explain and resolve this issue.
   • BHighlight this issue in the interim audit report and request operational management's response.
   • CEscalate this issue to the board and recommend a more realistic risk appetite.
   • DHold a meeting with the CEO to obtain further guidance on how to proceed.

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   Answer: A

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3. Question 463 · 475 in bank

   After being assigned to lead an internal audit of identity and access management, which of the following should be the auditor's next step?

   • AAssess the process-level risks associated with the identity and access management business area.
   • BDocument the scope and objectives of the audit and communicate them to management of the area under review.
   • CUnderstand why the audit of identity and access management was included on the annual internal audit plan.
   • DEstimate the number of hours required to complete the audit and assign audit staff accordingly.

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   Answer: C

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4. Question 464 · 475 in bank

   During an assurance engagement, the internal auditor noticed that the chief financial officer (CFO) solely authorized a transaction to sell carbon credits with a total value of $25 million. Which of the following criteria is most likely to assist the auditor in drawing a conclusion?

   • AThe CFO's explanation regarding the priority of the transaction.
   • BThe essence of the transaction authorized by the CFO.
   • CThe conditions of the letter of authorization issued to the CFO.
   • DThe internal auditor's professional judgement of the situation.

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   Answer: C

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5. Question 465 · 475 in bank

   A new internal auditor is assigned to assess key risks of electricity sales to business clients and wants to gain an understanding of the business. Which of the following is likely to yield the best understanding of significant risks and related controls?

   • AA review of the mission statement and long-term strategy of the company.
   • BA set of interviews with a sample of the business clients.
   • CAn analysis of a sample of electricity contracts concluded with business customers.
   • DAn interview with the manager who is responsible for electricity sales.

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   Answer: D

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6. Question 466 · 475 in bank

   An internal auditor is assessing the value of inventory in the financial accounts by reviewing the results of an inventory stock count. Which of the following statements is true regarding this approach to collecting evidence?

   • AAlthough the auditor did not physically observe the stock count, the results can be considered reliable.
   • BThe stock count results offer sufficient information for the auditor to assess the inventory.
   • CThe results of the stock count may be considered relevant information for the purpose of this review.
   • DTracing the stock count records to the stock items would achieve greater reliability.

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   Answer: C

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7. Question 467 · 475 in bank

   When developing recommendations to address deficiencies, the internal auditor should place the greatest emphasis on which of the following?

   • AThe effect of possible consequences that will convince management to take a corrective action.
   • BThe specific suggestions regarding which actions should be taken to eliminate deficiencies in controls.
   • CThe role of compensating controls that need to function properly in case primary controls fail.
   • DThe reasons why the observed conditions occurred or potentially could occur.

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   Answer: D

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8. Question 468 · 475 in bank

   An internal auditor is conducting a walk-through of the accounts payable process. The auditor wants to assess the extent of the completeness of debts to suppliers as recorded in the ledger. Which of the following techniques would be most appropriate?

   • ATracing randomly selected vendor invoices to the record in the general ledger.
   • BConfirming with the main customers that the amount owed matches the ledger’s recorded amounts.
   • CVouching a statistical sample of vendor invoices recorded in the general ledger.
   • DUsing analytical techniques to establish expectations of what should be recorded for vendors.

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   Answer: A

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9. Question 469 · 475 in bank

   During an audit engagement, the internal auditor discovered that physical security of the data center did not meet the organization's established requirements. The chief information security officer stated he would implement new procedures to minimize security threats by the end of the quarter. Which of the following would be the best way to follow up on the audit finding?

   • ASchedule thorough interviews with the personnel responsible.
   • BAnalyze relevant expense reports and invoices related to physical security enhancements.
   • CPrepare a checklist of security issues and visit the site.
   • DRequest a list of implemented improvements with formal confirmation by the chief information security officer.

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   Answer: C

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10. Question 470 · 475 in bank

    An internal auditor is planning a detailed review of human resources department processes. The review objective is to ascertain the control effectiveness of key business processes. Which of the following would be most useful to facilitate planning for this engagement?

    • AHuman resources management reports.
    • BDocumented workflows.
    • CRisk and control self-assessment.
    • DInterview with the head of the human resources department.

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    Answer: C

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IIA-CIA-PART2 practice, question 461. 475 questions available.