[Free] Download New Updated (October 2016) IIA IIA-CIA-Part1 Real Exam 351-360

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QUESTION 351

Internal control processes in an organization require that all investments exceeding $20,000 receive authorization from both the president and treasurer. After conducting a sample of these transactions,an auditor determined that 10 of the 500 investments in the sample had not included both required authorizations. The sample has a five percent acceptable error rate. Based on this sample, which of the following actions should the auditor take?

 

A.

Confirm all of the investments with the organization’s internal finance department.

B.

Contact the organization’s investment broker and confirm all investments.

C.

Complete a comprehensive review of the organization’s investment activity and compare variations over prior years.

D.

Determine that no further testing of investment authorizations is required.

 

Correct Answer: D

 

 

QUESTION 352

An internal auditor is planning an audit of an organization where temporary employees are suspected of receiving pay for hours they have not worked. Which of the following tasks should not be performed at this stage in the audit?

 

A.

Interviewing the manager who requested the audit engagement.

B.

Obtaining a copy of the contract between the organizations and the temporary employment agency.

C.

Interviewing shift supervisors about their employees’ attendance.

D.

Preparing an engagement program.

 

Correct Answer: C

 

 

QUESTION 353


Which of the following roles,if undertaken by an internal auditor,would have the greatest potential for conflict with the Standards regarding objectivity?

 

A.

IT system designer.

B.

Product development team consultant.

C.

Ethics advocate.

D.

External audit liaison.

 

Correct Answer: A

 

 

QUESTION 354

Line management of a manufacturing operation requests an operational audit. They are seeking recommendations for policies and procedures to enhance control over the operation. What should the internal audit activity do?

 

A.

Review the effectiveness of current policies and procedures but avoid making control recommendations due to impaired objectivity.

B.

Perform the engagement and make appropriate recommendations for policies and procedures.

C.

Turn down the engagement because recommending controls would impair future objectivity regarding this client.

D.

Turn down the engagement because an operational audit should not review policies and procedures.

 

Correct Answer: B

 

 

QUESTION 355

An internal audit activity has made a preliminary determination that a division of the organization has employed improper accounting practices. Upon being informed,the head of the organization instructs the chief audit executive (CAE) to cease the investigation and to withhold the information from external auditors. Which course of action should the CAE follow?

 

A.

Report the communication to the organization’s general counsel.

B.

Report the instruction to the chairperson of the audit committee.

C.

Inform the head of the organization that the investigation will continue as planned.

D.

Inform the external auditors of the findings and the mandate to stop investigating.

 

Correct Answer: B

 

 

QUESTION 356

Which of the following definitions best describes enterprise risk management?

 

A.

Enterprise risk management is narrower than internal control and focuses on managing the risk of loss resulting from external events.

B.

Enterprise riskmanagementis narrower than internal control and focuses on risk mitigation strategies across the enterprise.

C.

Enterprise risk management is broader than internal control and focuses on risk identification andmanagement,and assurance that business objectives will be met.

D.

Enterprise riskmanagementis broader than governance and internal control,and focuses on activities designed to ensure that risks are contained at a level acceptable to the enterprise.

 

Correct Answer: C

 

 

QUESTION 357

Performing a monthly analysis of potential duplicate invoices paid to suppliers is an example of which type of fraud control?

 

A.

Preventive control.

B.

Corrective control.

C.

Proactive control.

D.

Detective control.

 

Correct Answer: D

 

 

QUESTION 358

An internal auditor is gathering evidence for an organization’s internal audit engagement and requests a sample of vendor invoices from the organization. Which of the following is true regarding the reliability of this evidence?

 

A.

The invoices have zero reliability.

B.

The invoices have low reliability.

C.

The invoices have medium reliability.

D.

The invoices have high reliability.

 

Correct Answer: C

 

 

QUESTION 359

During an interview with a data-entry clerk in the human resources department,an internal auditor recognizes a potentially significant weakness with a database system used to track employee performance ratings. Which of the following actions should the auditor take after discovering the weakness?

 

A.

Schedule a series of follow-up interviews with the data-entry clerk.

B.

Avoid either directly or indirectly confronting the data-entry clerk about the system weakness.

C.

Question the data-entry clerk indirectly to help obtain more factual information about the weakness.

D.

Immediately document the weakness and write a report to the data-entry clerk’s superior.

 

Correct Answer: C

 

 

QUESTION 360

According to IIA guidance,which of the following statements is true regarding the reporting of results from a quality assurance and improvement program review of the internal audit activity?

 

A.

A report on the results of the assessment is issued upon completion,and progress on implementing recommended improvements must be reported monthly.

B.

The results are reported upon completion in confidence directly to the board,and management is advised only of the recommendations and improvement action plans.

C.

The results are shared with the board and management upon completion,and monitoring of recommended improvements must be reported at least annually.

D.

The results are communicated upon completion to the board and management,but action plans for recommended improvements do not have to be reported.

 

Correct Answer: C

 

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