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IIA-CIA-Part3-3P
CIA Exam Part Three: Business Knowledge for Internal Auditing Questions and Answers

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Viewing questions 21-30 out of questions

Questions # 21:

According to IIA guidance, which of the following is a primary component of a network security strategy?

Options:

Application input controls

Firewall controls.

Transmission encryption controls

Change management controls

Answer

Questions # 22:

An organization with global headquarters in the United States has subsidiaries in eight other nations. If the organization operates with an ethnocentric attitude, which of the following statements is true?

Options:

Standards used for evaluation and control are determined at local subsidiaries, not set by headquarters.

Orders, commands and advice are sent to the subsidiaries from headquarters.

People of local nationality are developed for the best positions within their own country

There is a significant amount of collaboration between headquarters and subsidiaries.

Answer

Questions # 23:

Senior management is trying to decide whether to use the direct write-off or allowance method for recording bad debt on accounts receivables.

Which of the following would be the best argument for using the direct write-off method?

Options:

It is useful when losses are considered insignificant.

It provides a better alignment with revenue.

It is the preferred method according to The IIA.

It states receivables at net realizable value on the balance sheet.

Answer

Explanation

[Reference: https://www.freshbooks.com/hub/accounting/direct-write-off-method, , ]

Questions # 24:

What would be the effect if an organization paid one of its liabilities twice during the year in error?

Options:

Assets liabilities and owners' equity would be understated

Assets net income and owners' equity would be unaffected

Assets and liabilities would be understated

Assets net income and owners' equity would be understated, but liabilities would be overstated

Answer

Questions # 25:

An organization uses the management-by-objectives method, whereby employee performance is based on defined goals Which of the following statements is true regarding this approach?

Options:

It is particularly helpful to management when the organization is facing rapid change

It is a more successful approach when adopted by mechanistic organizations

It is more successful when goal-setting is performed not only by management, but by an team members, including lower-level staff.

It is particularly successful in environments that are prone to having poor employer-employee relations

Answer

Questions # 26:

Which of the following is an example of internal auditors applying data mining techniques for exploratory purposes?

Options:

Internal auditors perform reconciliation procedures to support an external audit of financial reporting.

Internal auditors perform a systems-focused analysis to review relevant controls.

Internal auditors perform a risk assessment to identify potential audit subjects as input for the annual internal audit plan.

Internal auditors test IT general controls with regard to operating effectiveness versus design.

Answer

Explanation

[Reference: https://www.researchgate.net/publication/221174455_Data_Mining_Technique_in_the_Internal_Auditing_of_Enterprise_Groups, , ]

Questions # 27:

With regard to disaster recovery planning, which of the following would most likely involve stakeholders from several departments?

Options:

Determining the frequency with which backups will be performed.

Prioritizing the order in which business systems would be restored.

Assigning who in the IT department would be involved in the recovery procedures.

Assessing the resources needed to meet the data recovery objectives

Answer

Questions # 28:

Which of the following is a characteristic of using a hierarchical control structure?

Options:

Less use of policies and procedures

Less organizational commitment by employees

Less emphasis on extrinsic rewards

Less employees turnover

Answer

Questions # 29:

According to IIA guidance on IT. which of the following plans would pair the identification of critical business processes with recovery time objectives?