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Home IIA IIA-CIA-Part1

IIA IIA-CIA-Part1 Exam Practice Questions (P. 2)

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Question #11
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.
  1. A
    II, I, IV, III.
  2. B
    II, III, IV, I.
  3. C
    III, IV, II, I.
  4. D
    II, IV, I, III.

Correct Answer:
B

Question #12
During the planning phase of an audit of suspected overbilling on contracts for security services, an auditor should perform all of the following except:
  1. A
    Interviewing an official of the security services company to determine the cause of recent increases in billings for services.
  2. B
    Interviewing the manager who requested the audit engagement.
  3. C
    Obtaining a copy of the contract between the two organizations.
  4. D
    Preparing an engagement program.

Correct Answer:
A

Question #13
Which of the following statements regarding segregation of duties is true?
  1. A
    When evaluating an organization's policy on segregation of duties, employee competence does not need to be considered.
  2. B
    An organizational chart provides an accurate definition of segregation of duties.
  3. C
    A restrictive segregation-of-duties policy can help improve an organization's communication.
  4. D
    Policies on segregation of duties in information systems must recognize the difference between logical and physical access to assets.

Correct Answer:
D

Question #14
An auditor plans to analyze customer satisfaction, including. (1) customer complaints recorded by the customer service department during the last three months;
(2) merchandise returned in the last three months; and (3) responses to a survey of customers who made purchases in the last three months.
Which of the following statements regarding this audit approach is correct?
  1. A
    Although useful, such an analysis does not address any risk factors.
  2. B
    The survey would not consider customers who did not make purchases in the last three months.
  3. C
    Steps 1 and 2 of the analysis are not necessary or cost-effective if the customer survey is comprehensive.
  4. D
    Analysis of three months' activity would not evaluate customer satisfaction.

Correct Answer:
B

Question #15
If an internal auditor discloses confidential information in response to a lawsuit, the internal auditor has violated.
  1. A
    The IIA Code of Ethics.
  2. B
    The Standards.
  3. C
    Both the IIA Code of Ethics and the Standards.
  4. D
    Neither the IIA Code of Ethics nor the Standards.

Correct Answer:
D

Question #16
In developing an appropriate work program for an audit engagement, the most important factor for an audit supervisor to consider is the:
  1. A
    Availability of records and data.
  2. B
    Potential impact of risks.
  3. C
    Audit personnel's knowledge and experience.
  4. D
    Time required to complete the engagement.

Correct Answer:
B

Question #17
An organization has a policy requiring two signatures on all checks written for amounts in excess of $10, 000. When evaluating controls over disbursements, an auditor would conclude that a greater risk exists if.
  1. A
    The auditor located two checks for $9, 000 each that contained one authorized signature.
  2. B
    The $10, 000 was an immaterial amount to the organization and very few cash disbursements required an amount in excess of $10, 000.
  3. C
    The director of accounting was not one of the authorized signers.
  4. D
    There were several instances in which successively numbered checks for amounts between $5, 000 and $10, 000 were made payable to the same vendor.

Correct Answer:
D

Question #18
Which of the following is not an appropriate type of coordination between the internal audit activity and regulatory auditors?
  1. A
    Regulatory auditors share their perspective on risk management, control, and governance with the internal auditors.
  2. B
    Internal auditors perform fieldwork at the direction of the regulatory auditors.
  3. C
    Internal auditors review copies of regulatory reports in planning related internal engagements.
  4. D
    Regulatory and internal auditors exchange information about planned activities.

Correct Answer:
B

Question #19
Which of the following activities most significantly increases the risk that a bank will make poor-quality loans to its customers?
  1. A
    Borrowers may not sign all required mortgage loan documentation.
  2. B
    Fees paid by the borrower at the time of the loan may not be deposited in a timely manner.
  3. C
    The bank's loan documentation may not meet the government's disclosure requirements.
  4. D
    Loan officers may override the lending criteria established by senior management.

Correct Answer:
D

Question #20
An organization that outsources much of its internal audit work to an external service provider is planning for an external quality assessment. Which of the following options would accomplish this task and be in conformance with the Standards?
  1. A
    External industry associate that performed a similar review for a supplier of the organization.
  2. B
    A team from an independent entity that previously employed the chief audit executive of the organization.
  3. C
    A team under the direction of the organization's chief audit executive with validation by a former manager of the internal audit activity.
  4. D
    The same external service provider because of its competency and experience with the organization.

Correct Answer:
A

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