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Pass the IIA CIA Challenge Exam IIA-ACCA Questions and answers with ExamsMirror

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Viewing page 7 out of 13 pages

Viewing questions 91-105 out of questions

Questions # 91:

Which of the following factors should a chief audit executive consider when determining the audit universe?

1. Components of the organization's strategic plan.

2. Inputs from senior management and the board.

3. Views of competitors and business associates.

4. Results of exit interviews with departing employees.

Options:

1 and 2 only

2 and 4 only

1, 2, and 4

2, 3, and 4

Questions # 92:

Due to price risk from the foreign currency purchase of aviation fuel, an airliner has purchased forward contracts to hedge against fluctuations in the exchange rate. When recalculating the exchange losses from individual purchases of jet fuel, which of the following details does the internal auditor need to validate?

1. The hedge documentation designating the hedge.

2. The spot exchange rate on the transaction date.

3. The terms of the forward contract.

4. The amount of fuel purchased.

Options:

1 and 2

1 and 4

2 and 3

3 and 4

Questions # 93:

An audit identified a number of weaknesses in the configuration of a critical client/server system. Although some of the weaknesses were corrected prior to the issuance of the audit report, correction of the rest will require between 6 and 18 months for completion. Consequently, management has developed a detailed action plan, with anticipated completion dates, for addressing the weaknesses. What is the most appropriate course of action for the chief audit executive to take?

Options:

Assess the status of corrective action during a follow-up audit engagement after the action plan has been completed.

Assess the effectiveness of corrections by reviewing statistics related to unplanned system outages, and denials of service.

Reassign information systems auditors to assist in implementing management's action plan.

Evaluate the ability of the action plan to correct the weaknesses and monitor key dates and deliverables.

Questions # 94:

According to IIA guidance,which of the following is true about the supervising internal auditor's review notes?

• They are discussed with management prior to finalizing the audit.

• They may be discarded after working papers are amended as appropriate.

• They are created by the auditor to support her fieldwork in case of questions.

• They are not required to support observations issued in the audit report.

Options:

1 and 3 only

1 and 4 only

2 and 3 only

2 and 4 only

Questions # 95:

During an audit of the accounts receivable (AR) process, an internal auditor noted that reconciliations are still not performed regularly by the AR staff, a recommendation that was made following a previous audit. Monitoring by the financial reporting function has failed to detect the shortcoming. Both the financial reporting function and AR report to the controller, who is responsible for implementing action plans. Which of the following supports the internal auditor's decision to combine both observations into one reported finding?

Options:

The observation was made during the same audit, and the action plan has a common owner.

The observation relates to the same control activity within a common process.

The observation has a common control, and it was noted in a prior audit.

The observation has a common process, and the action plan for the observation has a common owner.

Questions # 96:

Which of the following statements about internal audit's follow-up process is true?

Options:

The nature, timing, and extent of follow-up for assurance engagements is standardized to ensure quality performance.

The actions of external auditors and other external assurance providers is not encompassed by internal audit's follow-up process.

Internal auditors have responsibility for determining if management and the board have implemented the recommended action or otherwise accepted the risk.

The follow-up process must be complete and documented in the working papers in order to conclude the engagement.

Questions # 97:

Which of the following is not a direct benefit of control self-assessment (CSA)?

Options:

CSA allows management to have input into the audit plan.

CSA allows process owners to identify, evaluate, and recommend improving control deficiencies.

CSA can improve the control environment.

CSA increases control consciousness.

Questions # 98:

Which of the following is a justifiable reason for omitting advance client notice when planning an audit engagement?

Options:

Advance notice may result in management making corrections to reduce the number of potential deficiencies.

Previous management action plans addressing prior internal audit recommendations remain incomplete.

The engagement includes audit assurance procedures such as sensitive or restricted asset verifications.

The audit engagement has already been communicated and approved through the annual audit plan.

Questions # 99:

According to IIA guidance, which of the following would not be a consideration for the internal audit activity (IAA) when determining the need to follow-up on recommendations?

Options:

Degree of effort and cost needed to correct the reported condition.

Complexity of the corrective action.

Impact that may result should the corrective action fail.

Amount of resources required to conduct the follow-up activities.

Questions # 100:

Which of the following has the greatest effect on the efficiency of an audit?

Options:

The complexity of deficiency findings.

The adequacy of preliminary survey information.

The organization and content of workpapers.

The method and amount of supporting detail used for the audit report.

Questions # 101:

The newly appointed chief audit executive (CAE) of a large multinational corporation, with seasoned internal audit departments located around the world, is reviewing responsibilities for engagement reports. According to IIA guidance, which of the following statements is true?

Options:

The CAE is required to review, approve, and sign every engagement report.

The CAE is required to review, approve, and sign all regulatory compliance engagement reports only

The CAE may delegate responsibility for reviewing, approving and signing engagement reports, but should review the reports after they are issued.

The internal audit charter must identify authorized signers of engagement reports.

Questions # 102:

Which of the following is an appropriate responsibility for the internal audit activity with regard to the organization's risk management program?

Options:

Identifying and managing risks in line with the entity's risk appetite.

Ensuring that a proper and effective risk management process exists.

Attaining an adequate understanding of the entity's key mitigation strategies.

Identifying and ensuring that appropriate controls exist to mitigate risks.

Questions # 103:

An internal auditor determines that certain information from the engagement results is not appropriate for disclosure to all report recipients because it is privileged. In this situation, which of the following actions would be most appropriate?

Options:

Disclose the information in a separate report.

Distribute the information in a confidential report to the board only

Distribute the reports through the use of blind copies.

Exclude the results from the report and verbally report the conditions to senior management and the board.

Questions # 104:

Which of the following statements is false regarding roles and responsibilities pertaining to risk management and control?

Options:

Senior management is charged with overseeing the establishment risk management and control processes.

The chief audit executive is responsible for overseeing the evaluation risk management and control processes.

Operating managers are responsible for assessing risks and controls in their departments.

Internal auditors provide assurance about risk management and control process effectiveness.

Questions # 105:

The internal audit activity (IAA) wants to measure its performance related to the quality of audit recommendations. Which of the following client survey questions would best help the IAA meet this objective?