Testking offers free demo for IIA-CIA-Part1 exam. "Certified Internal Auditor - Part 1, The Internal Audit Activitys Role in Governance, Risk, and Control", also known as IIA-CIA-Part1 exam, is a IIA Certification. This set of posts, Passing the IIA IIA-CIA-Part1 exam, will help you answer those questions. The IIA-CIA-Part1 Questions & Answers covers all the knowledge points of the real exam. 100% real IIA IIA-CIA-Part1 exams and revised by experts!
Q226. During an engagement, an internal auditor decided to use variance analysis as an auditing techniques. Which of the following steps should the auditor pursue if he discovers unexpected deviations of actual results from budget?
A. Report the deviations immediately to the audit committee.
B. Gather additional information to determine the cause of the deviations.
C. Conclude that the budget was unreasonably set and accept the deviations.
D. Perform alternative forms of analytical procedures which provide no deviations.
Answer: B
Q227. Management of a publicly-held organization requires the internal audit activity to be involved with quarterly financial statements, which are made public and used internally. Which of the following explanations of management's decision is least plausible?
A. Management may be concerned about its reputation in the financial markets.
B. Management is following best-practice protocol,as stipulated by the Standards,which states that internal auditors must review quarterly financial statements.
C. Management may be concerned about potential penalties that could occur if quarterly financial statements are misstated.
D. Management may perceive that having quarterly financial information examined by the internal auditors enhances the information's value to internal decision making.
Answer: B
Q228. Which of the following is the responsibility of an internal auditor?
1.
Assist operating management in implementing audit recommendations.
2.
Provide management with value-added analysis to improve operations.
3.
Become an advocate for changes to the internal audit activity charter.
4.
Disclose non-financial risks that may be identified during the course of an engagement.
A. 1 and 3 only
B. 2 and 4 only
C. 1,2,and 4 only
D. 1,2,3,and 4
Answer: B
Q229. Which of the following is true regarding the purpose of the COSO enterprise risk management framework?
1.
It is a process that is ongoing and flows throughout the organization.
2.
It contributes to the formulation of the organization's mission and vision.
3.
It enables internal audit to provide reasonable assurance to an organization's management and the board.
4.
It enables the management of risks within an organization's risk appetite.
A. 1,2,and 3 only
B. 1,2,and 4 only
C. 1,3,and 4 only
D. 2,3,and 4 only
Answer: C
374. Which of the following controls within a spreadsheet would address the risk of logic errors?
1.
The spreadsheet contains formulas that foot and cross-foot data.
2.
The spreadsheet is locked to protect cell formulas from being inadvertently changed.
3.
Spreadsheets are included in nightly backup processes.
4.
Check-in and check-out software is used to manage version control.
A. 1 and 2 only
B. 1 and 3 only
C. 2 and 4 only
D. 3 and 4 only
Answer: A
Q230. An internal auditor pays to participate in the company's annual golf tournament, which is held outside of normal business hours.
The auditor wins the putting contest and is awarded an all-expense-paid weekend vacation.
According to the IIA Code of Ethics regarding objectivity, the auditor's best course of action would be to:
A. Refuse the prize because the amount is significant.
B. Accept the prize because the event was held outside of normal business hours.
C. Refuse the prize because it represents an impairment to objectivity.
D. Accept the prize because the auditor received no special treatment.
Answer: D
Q231. Which of the following is not a standard technique that the chief audit executive (CAE) would use to provide evidence of supervisory review of working papers?
A. The CAE initials and dates every working paper after it has been reviewed.
B. The CAE completes an engagement working paper checklist.
C. The CAE prepares a memorandum discussing the results of the working paper review.
D. The CAE utilizes an external third party to make an objective recommendation after each working paper review.
Answer: D
Q232. According to IIA guidance, which of the following best describes processes and tools typically used in ongoing internal assessments?
A. Benchmarking of the internal audit activity's practices and performance.
B. Report of internal assessment results,response plans,and outcomes.
C. Analysis of performance metrics such as cycle times.
D. Self-assessments and surveys of stakeholder groups.
Answer: C
Q233. Which of the following factors is not likely to affect the level of inherent risk associated with an application system?
A. The system is strategic.
B. Controls over the system appear reliable.
C. The system is not a critical operating system.
D. The system uses complex technology.
Answer: B
Q234. Management has decided to invest significant capital in a new and innovative large computer system. They understand that they are one of the first organizations to implement this system, but they believe the benefits outweigh the uncertainty over the performance and reliability of the software. This decision best describes which aspect of risk management?
A. Risk appetite.
B. Risk tolerance.
C. Residual risk.
D. Inherent risk.
Answer: A
343. An internal auditor is testing the controls of a large and complex food production process where quality assurance is critical. Management provides process charts and documentation, but the auditor quickly determines that this information is incomplete and out of date. Which of the following would be the most appropriate course of action for the auditor to follow?
A. Use the documentation but meet with the production supervisor to obtain updated information before proceeding.
B. Amend the engagement objectives recognizing that important information is not available to protect the engagement's integrity.
C. Defer the audit until management can provide updated charts and documentation as this is their responsibility.
D. Use the documentation but use observation during the engagement to provide missing information.
Answer: A
Q235. Why is a code of ethics for the internal audit profession necessary?
A. It ensures that all members of the profession possess the same level of competence.
B. It provides auditors with protection from lawsuits.
C. It guides internal auditors in their service to others.
D. It requires auditors to exhibit loyalty to their organizations.
Answer: C
Q236. When internal auditors are preparing workpapers for the testing stage of an engagement, which of the following guidelines should be observed?
1.
Include copies of all client files that were reviewed for the audit.
2.
Avoid the use of professional, industry-appropriate jargon and technical terms.
3.
Indicate the original sources of all data and information used in the workpapers.
4.
Leave blank space for cross-references to be completed during the post-audit process.
A. 1 and 2only
B. 1 and 4only
C. 2 and 3only
D. 3 and 4only
Answer: C
Q237. Which of the following lists the audit activities in the order in which they would generally be completed during a preliminary survey?
I. Write detailed audit procedures.
II. Identify client objectives, goals, and standards.
III. Identify risks and controls intended to prevent associated losses.
IV.
Determine relevant engagement objectives.
A.
II,I,IV,III.
B.
II,III,IV,I.
C.
III,IV,II,I.
D.
II,IV,I,III.
Answer: B
Q238. Which of the following would not be considered part of preliminary survey of an engagement area?
A. Interviews with individuals affected by the entity.
B. Functional walk through test.
C. Analytical reviews.
D. Sampling scope.
Answer: D
Q239. Reviewing prior audit reports and supporting workpapers before an engagement starts enables an internal auditor to do which of the following?
1.
To understand better the activity and processes that will be audited.
2.
To identify the audit procedures that will be used during the engagement.
3.
To ensure that matters of greatest vulnerability will be addressed.
4.
To use the information obtained as evidence in the current engagement.
A. 4only
B. 1 and 3only
C. 1 and 4only
D. 2,3,and 4only
Answer: B
Q240. An internal auditor is planning an operational audit of the accounts payable function. Which of the following best mitigates the risk of the organization being a victim of disbursement fraud by employees?
A. Accounts payable payment records are checked against supplier invoices.
B. Accounts payable are aged by vendors.
C. The accounts payable trial balance is reconciled to the general ledger.
D. The accounts payable function is properly segregated from the cash custody function.
Answer: D