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Question 61 Selectable Answer

In which of the following situations may the internal audit activity report conformance with the Standards?

A. An internal audit activity has been in existence at least five years and has not completed an external assessment,
B. An internal auditor was assigned to an audit engagement but did not meet individual objectivity requirements.
C. The internal audit activity prepared an internal audit plan that was not risk-based.
D. The internal audit activity has been in existence fewer than five years, but periodic self-assessments were conducted.

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Question 62 Selectable Answer

Which of the following options describes the reason that conformance with The IIA's Code of Ethics is mandatory for internal auditors?

A. Ethical compliance provides the basis for stakeholder confidence in the competence of the internal audit activity and of professional internal auditors.
B. Ethical compliance is necessary for internal auditors and the internal audit activity to accept responsibility for providing g absolute assurance about the organization's risk management.
C. Ethical compliance provides the basis for stakeholder trust and confidence in the validity of the profession of internal auditing and the internal audit activity's findings.
D. The internal audit activity's ethical compliance sets the tone for the ethical compliance by the organization's board, management, and employees.

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Question 63 Selectable Answer

Which of the following best describes the board’s role in establishing effective organizational governance?

A. The board is involved in approving operational policy
B. The board monitors key processes and procedures
C. The board has oversight responsibility for organizational resources
D. The board approves management's detailed plans and objectives

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Question 64 Selectable Answer

As a result of a high-profile processing error, respective business unit managers are implementing new controls. The internal audit team was asked for their advice regarding the controls. The objective of this consulting engagement would be determined by which of the following?

A. The organization's board of directors.
B. The chief audit executive.
C. The business unit manager and the engagement supervisor.
D. The compliance manager and the business unit manager.

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Question 65 Selectable Answer

An organization s board of directors has decided that the internal audit activity must have greater access to different pans of the organization in order to perform their assurance work effectively Which of !he following areas is the board seeking to improve by making this change?

A. Internal audit authority.
B. Internal audit reporting structure.
C. Internal audit independence and objectivity.
D. Internal audit interaction with the board

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Question 66 Selectable Answer

Which of the following best describes the type of organizational culture known as adaptability culture'?

A. A results-oriented culture that values competitiveness and personal initiative
B. A culture that emerges in quick-response and high-risk decision-making environments
C. A culture that is characterized by low involvement with environmental and health issues
D. A culture that places high value on participation and meeting the needs of employees.

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Question 67 Selectable Answer

Upon completion of an external assessment as part of the quality assurance and improvement program (QAIP), the chief audit executive (CAE) reported the results to senior management and the board The CAE included the following elements in the report
- Qualifications and independence of me external assessment team
- Conclusions of assessors
- Corrective action plans
How should the CAE improve the aforementioned approach to reporting the resets of QAIP?

A. Senior management should be excluded from the reporting as the QAiP results must be communicated to re board only
B. The report can be streamlined by removing unnecessary information such as the qualifications and me independence of external assessors
C. The results must be snared with the external a auditors as well, so they can determine the extent to which they can rely on me work of the internal audit activity
D. The report should indicate that the external assessment must be performed at least once every five years

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Question 68 Selectable Answer

Which of the following concepts is emphasized in the Mission of Internal Audit?

A. Support of good governance and controls.
B. Enhancement of organizational value.
C. Protection of tangible and intangible assets.
D. Provision of professional advisory and assurance services.

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Question 69 Selectable Answer

A chief audit executive (CAE) is considering hiring a candidate who most recently worked for a large public accounting firm What would be the CAE’s most likely concern regarding this candidate*?

A. Low-level audit expertise
B. Narrow industry experience
C. MPotential conflict of interest
D. Weak interpersonal skills

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Question 70 Selectable Answer

Which of the following would be the most appropriate first step for the board to take when developing an effective system of governance?

A. Determine the organization’s overall risk appetite.
B. Establish a governance committee.
C. Delegate authority to members of senior management.
D. Identify key stakeholders and their expectations

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Question 71 Selectable Answer

Which of the following would be considered a monitoring activity in organization wide risk management?

A. Validate the results of management's self-assessment.
B. Perform reviews of personnel.
C. Maintain rigorous and comprehensive documentation.
D. Obtain authorizations and signatures.

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Question 72 Selectable Answer

Senior management has decided to adopt the key principles approach of the ISO 31000 risk management framework. According to IIA guidance, which of the following principles is most appropriate when implementing the risk management process in a dynamic agency?

A. Everyone in the agency has a primary responsibility for identifying and managing risks as part of the risk management process.
B. The risk management process, while evaluating risk, should develop a mechanism to rank the relative importance of each risk.
C. The risk management process should be regularly reviewed and respond to changes in the environment, to remain relevant.
D. The risk management process should use a formal technique to consider the consequence and likelihood of each risk.

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Question 73 Selectable Answer

The internal audit activity is responsible for conducting fraud investigations. A potential fraud instance was identified during an audit engagement. The chief audit executive appoints a lead investigate.
Which of the following would most likely be the next step?

A. Ask internal auditors to gather all relevant information evidence
B. Identify and interview witnesses first potential suspects later.
C. Conduct a fraud risk assessment to the most vulnerable areas.
D. Determine me competencies needed and assess whatever team members have a conflict of interest.

Answer:

Question 74 Selectable Answer

Evidence discovered during the course of an engagement suggests that multiple incidents of fraud have occurred. There do not appear to be sufficient controls in place to prevent reoccurrence.
Which of the following is the internal auditor's most appropriate next step?

A. Immediately notify management of the area under review and the other internal auditors involved in the engagement.
B. Discuss the situation with the engagement supervisor to determine whether fraud investigation experts are required to investigate the matter properly.
C. Fully document in the workpapers the evidence that has been discovered and recommend appropriate controls to address the fraud.
D. Provide the evidence that was discovered to local law enforcement for possible prosecution of the suspected fraud.

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Question 75 Selectable Answer

According to NA guidance, which of the following actions by the chief audit executive would best ensure that internal auditors demonstrate due professional care?

A. Developing policies and procedures for the internal audit activity.
B. Ensuring the internal audit activity is not found fallible during audit engagements.
C. Undertaking all engagements that management requests of the internal audit activity.
D. Ensuring the internal audit activity reports functionally to the board of directors.

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