Free certification test prep

NEW QUESTION 57
An organization has acquired a new line of business. None of the organization’s internal auditors have the required expertise to perform an internal audit of the new business line; therefore, the chief audit executive (CAE) has contracted the services of an external audit firm to perform the engagement. The CAE has assigned a member of the internal audit team to assist the external team with the engagement. According to the Standards, which of the following statements is true regarding supervision of the engagement?

NEW QUESTION 58
Which of the following would be most helpful to a governmental auditor searching for the existence of multiple welfare claims that were filed under different names but used the same address?

NEW QUESTION 59
Which of the following items should be addressed in an organization’s privacy statement?
I.Intended use of collected information.
II.
Data storage and security.
III.
Network/infrastructure authentication controls.
IV.
Data retention policy of the organization.
Parties authorized to access information.

NEW QUESTION 60
Which of the following factors would not be considered in determining appropriate follow-up procedures?

NEW QUESTION 61
An audit client responded to recommendations from a recent consulting engagement. The client indicated that several recommended process improvements would not be implemented. Which of the following actions should the internal audit activity take in response?

NEW QUESTION 62
An organization’s policies allow buyers to authorize expenditures up to $50,000 without any other approval. Which of the following audit procedures would be most effective in determining if fraud in the form of payments to fictitious companies has occurred?

NEW QUESTION 63
Monetary-unit sampling is most useful when the internal auditor:

NEW QUESTION 64
Which of the following is least likely to help ensure that risk is considered in a work program?

NEW QUESTION 65
The balanced scorecard approach differs from traditional performance measurement approaches because it adds which of the following measures?
I. Financial measures.
II. Internal business process measures.
III. Client satisfaction measures.
IV. Innovation and learning measures.

NEW QUESTION 66
The chief audit executive of a medium-sized financial institution is evaluating the staffing model of the internal audit activity (IAA). According to IIA guidance, which of the following are the most appropriate strategies to maximize the value of the current IAA resources?
* The annual audit plan should include audits that are consistent with the skills of the IAA.
* Audits of high-risk areas of the organization should be conducted by internal audit staff.
* External resources may be hired to provide subject-matter expertise but should be supervised.
* Auditors should develop their skills by being assigned to complex audits for learning opportunities.

NEW QUESTION 67
During an operational audit of a chain of pizza delivery stores, an auditor determined that cold pizzas were causing customer dissatisfaction. A review of oven calibration records for the last six months revealed that adjustments were made on over 40 percent of the ovens. Based on this, the auditor:

NEW QUESTION 68
Which of the following would provide the best audit evidence regarding the effectiveness of an applied research department?

NEW QUESTION 69
Which of the following types of contracts would provide the least incentive for a contractor to achieve economy and efficiency?

NEW QUESTION 70
The chief audit executive (CAE) of a large retail operation believes that senior management has accepted a level of risk that exceeds the organization’s current risk tolerance with respect to a major expansion. The CAE plans to meet with senior management to discuss these concerns. According to IIA guidance, which of the following would be an appropriate course of action in preparation for this meeting?
Understand management’s basis for the decision.
Advise the board of the concern and upcoming meeting.
Ascertain which members of management have accepted the risk.
Determine if management has the authority to accept the risk.

NEW QUESTION 71
An auditor used a questionnaire during an interview to gather information about the nature of credit sales processing. The questionnaire did not cover some pertinent information offered by the person being interviewed, and the auditor did not document the potential problems for further investigation.
The primary deficiency with the above process is that:

NEW QUESTION 72
Which of the following is the correct ratio to use in calculating the dollar value of the population if the auditor is using ratio estimation?
Number of Items
Audited Value
Carrying Amount
Sample
300
$500,000
$480,000
Population
3,000
$5,000,000