[Free] Download New Updated (October 2016) IIA IIA-CIA-Part1 Real Exam 181-190

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QUESTION 181

During an audit engagement,an internal auditor finds that management is not complying with previous commitments made to the external auditors. However, the auditor determines management’s actions to be justified due to significant changes in the business. The best course of action for the auditor to take would be to:

 

A.

Proceed with the audit engagement and assess the changes actually implemented by management.

B.

Inform the external auditors and seek their guidance.

C.

Inform the external auditors and remove the associated work from the internal audit scope.

D.

Compare the recommended changes against the changes made by management and advise management which action to take.

 

Correct Answer: A

 

 


QUESTION 182

The audit process used by the internal audit activity of a large wholesale clothing company does not include an engagement letter or project approval document. The most serious consequence of this deficiency in the process is thatthe:

 

A.

Audit schedule may not be optimal from the engagement client’s perspective.

B.

Audit objectives may not be understood by management of the area being audited.

C.

Audit resources may not be sufficient.

D.

Audit plan priority may have changed.

 

Correct Answer: B

 

 

QUESTION 183

During a review of data center physical security and environmental con
trols,an auditor should ensure that:

 

I. Visitors are accompanied by authorized personnel at all times.

 

II. Only developers and operators have access to the data center.

 

III. Fire suppression equipment is tested periodically.

 

IV. Fire and water detectors have been installed.

 

A.

I and III only

B.

II and IV only

C.

I, III, and IV only

D.

II, III, and IV only

 

Correct Answer: C

 

 

QUESTION 184

The audit committee has asked the chief audit executive (CAE) to assist in the selection of a new external audit firm. Which of the following is an appropriate action by the CAE?

 

A.

The CAE and two managers from the audit staff review the bids and select one firm to meet with the audit committee for the committee’s approval.

B.

The CAE develops a formal set of criteria for the audit committee to use in selecting the external auditor.

C.

The CAE, chief financial officer, and controller review the bids, interview two firms,and recommend one of the two firms to the audit committee for its approval.

D.

The CAE declines to participate in the process because providing this assistance would result in compromising the internal audit activity’s objectivity.

 

Correct Answer: B

 

 

QUESTION 185

The percentage of orders that are rush orders and the percentage of returns to total orders are examples of which of the following types of control activities?

 

A.

Quality control monitoring.

B.

Direct functional management.

C.

Benchmarking.

D.

Performance indicators.

 

Correct Answer: D

QUESTION 186

In assessing the independence of the internal audit activity, a member of a peer review team should consider all of the following factors except:

 

A.

Access to and frequency of communications with the board of directors or its audit committee.

B.

The criteria of education and experience considered necessary when filling vacant positions on the audit staff.

C.

The degree to which auditors assume operating responsibilities.

D.

The scope and depth of engagement objectives for the audit engagements included in the review.

 

Correct Answer: B

 

 

QUESTION 187

Which of the following best contributes to the effectiveness of the internal audit activity in an organization?

 

A.

Appropriate terms of internal audit scope and responsibility in the charter.

B.

Appropriate compliance coverage in the annual audit plan.

C.

Regular review of the audit charter by management.

D.

Assurance of internal audit objectivity by the board.

 

Correct Answer: A

 

 

QUESTION 188

All of the following would normally be involved in preparing for and carrying out the internal audit activity’s annual plan except:

 

A.

Establishing policies and procedures for workpapers and referencing.

B.

Providing periodic activity reports to the audit committee on audit engagements in progress.

C.

Assessing the amount of risk in major departments.

D.

Training audit staff on appropriate audit methodologies for addressing any newly identified risks.

 

Correct Answer: A

 

 

QUESTION 189

Risk assessments can vary in format,but generallyinclude.

 

I. A description of identified risks.

 

II. Tests of audit controls.

 

III. A system of rating risks.

 

IV. Sample size identification.

 

A.

I and II only

B.

I and III only

C.

I, III, and IV only

D.

II, III, and IV only

 

Correct Answer: B

 

 

QUESTION 190

Internal auditors can benefit from a strong relationship with the external auditors because external auditors can:

 

A.

Provide internal auditors with an independent and knowledgeable viewpoint.

B.

Concur with the internal auditors’ reports and thus improve the quality of assurance provided to management.

C.

Increase the effectiveness of internal control sampling techniques.

D.

Assist the internal auditor by providing information obtained from similar audits with other clients.

 

Correct Answer: A

 

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