IIA-CIA-Part2 Exam Dumps (V18.03) for Internal Audit Engagement Exam Preparation: Start Reading IIA-CIA-Part2 Free Dumps (Part 1, Q1-Q40) First

1. The chief audit executive (CAE) should determine whether the internal audit activity has confirmed the status of all of management's corrective actions Doing so would help the CAE assess which of the following?

2. An organization buys crude oil on the open market and refines it into a high-quality gasoline. The price of crude oil is extremely volatile.

Which of the following is the most appropriate risk management technique to protect the organization against these price fluctuations?

3. An organization has a health and safety division that conducts audits to meet regulatory requirements. The chief health and safety officer reports directly to the CEO.

Which of the following describes an appropriate role for the chief audit executive (CAE) with regard to the organization's health and safety program?

4. An internal auditor is preparing for an auditor of newly implemented software that is used by 3,000 employees in South America and Europe.

What would be the best way for the auditor to gather relevant feedback?

5. 'Internal policy prohibits employees from entering into contacts with financial obligations without proper approval.

A project manager signed a change to an important service agreement without obtaining the proper approval As a result the organization is receiving $5,000 per month less for its services.’’

Which of the following should be added to the observation?

6. During an assurance engagement, an internal auditor noted that the time staff spent accessing customer information in large Excel spreadsheets could be reduced significantly through the use of macros. The auditor would like to train staff on how to use the macros.

Which of the following is the most appropriate course of action for the internal auditor to take?

7. An organization's board would like to establish a formal risk management function and has asked the chief audit executive (CAE) to be involved in the process.

According to IIA guidance, which of the following roles should the CAE not undertake?

8. An internal auditor completed a review of expenses related to the launch of a new project. The auditor sampled 45 transactions approved by a senior project manager and identified 30 with questionable vendor documentation.

Which of the following is the most appropriate conclusion for the auditor to include in the audit report?

9. Which of the following attribute sampling methods would be most appropriate to use to measure the total misstatement posted to an accounts payable ledger?

10. The chief audit executive (CAE) determined that the internal audit activity lacks the resources needed to complete the internal audit plan.

Which of the following would be the most appropriate action tor the CAE to take?

11. As part of internal audit's assistance with an annual external audit, the internal auditors are required to do a preliminary analytical review of an bank account balances. This involves verifying the current year end balances as web as comparing the current year end balances with previous year end balances to highlight significant changes.

Which of the following is the most reliable source for verification of the current year end bank balances?

12. A toy manufacturer receives certain components from an overseas supplier and uses them to assemble final products Recently quality reviews have identified numerous issues regarding the components' compliance with mandatory quality standards.

Which type of engagement would be most appropriate to assess the root causes of the quality issues?

13. An internal auditor is assigned to validate calculations on the organization's building application As pad of the test the internal auditor is required to use an automated audit tool to simulate transactions for testing.

Which of the following would most appropriately be used for this purpose?

14. Which of the following statements concerning workpapers is the most accurate?

15. A chief audit executive (CAE) is determining which engagements to include on the annual audit plan. She would like to consider the organization's attitude toward risk and the degree of difficulty in achieving objectives.

Which of the following resources should the CAE consult?

16. Management has taken immediate action to address an observation received during an audit of the organization's manufacturing process.

Which of the following is true regarding the validity of the observation closure?

17. Which of the following should be the focus of the effect section of the preliminary observations document?

18. The internal audit manager has been delegated the task of preparing the annual internal audit plan for the forthcoming fiscal year All engagements should be appropriately categorized and presented to the chief audit executive for review.

Which of the following would most likely be classified as a consulting engagement?

19. During the fieldwork phase of an assurance engagement, the internal auditor decides that she wants to adjust the audit work program.

Which of the following is the most appropriate next step for the auditor to take?

20. An organization's finance manager plans to implement a state-of-the-art management system to better manage the organization's receivables. The finance manager consulted the chief audit executive (CAE) and asked for her assistance in determining whether the organization is able to accommodate this system.

How would the CAE proceed to determine the objectives of this engagement?

21. The final internal audit report should be distributed to which of the following individuals?

22. During a fraud interview, it was discovered that unquestioned authority enabled a vice president to steal funds from the organization.

Which of the following best describes this condition?

23. According to IIA guidance, which of the following reflects a characteristic of sufficient and reliable information?

24. Which of the following statements generally true regarding audit engagement planning?

25. Which of the following should be described in the recognition element of a typical internal audit repot?

26. An internal auditor conducted interviews with several employees, documented the interviews analyzed the summaries, and drew a number of conclusions.

What sort of audit evidence has the internal auditor primarily obtained?

27. Which of the following is one of the five attributes that internal auditors include when documenting a deficiency?

28. Which of the following statements about assurance maps is correct?

29. According to an internal audit observation, the organization’s rules of record management require all contracts to be registered and stored in a specific electronic system. One subsidiary has thousands of client contracts on paper, which are kept in the office because there are not enough assistants to scan the contracts into the system.

Which of the following component should be added to this observation?

30. When forming an opinion on the adequacy of management's systems of internal control, which of the following findings would provide the most reliable assurance to the chief audit executive?

• During an audit of the hiring process in a law firm, it was discovered that potential employees' credentials were not always confirmed sufficiently. This process remained unchanged at the following audit.

• During an audit of the accounts payable department, auditors calculated that two percent of accounts were paid past due. This condition persisted at a follow up audit.

• During an audit of the vehicle fleet of a rental agency, it was determined that at any given time, eight percent of the vehicles were not operational. During the next audit, this figure had increased.

• During an audit of the cash handling process in a casino, internal audit discovered control deficiencies in the transfer process between the slot machines and the cash counting area. It was corrected immediately.

31. When me internal audit activity does not have sufficient time to complete its usual root cause analysis which c4 the following is most appropriate?

32. An internal auditor was reviewing the procurement department's tender documentation for completeness He documented all discrepancies but the procurement manager disagreed with his findings Upon further review, the internal auditor noted that all discrepancies had been corrected in the tender database.

Which of the following courses of action would have prevented this situation?

33. What is the primary objective of an engagement supervisor's review of key activities performed during the engagement?

34. A corporate merger decision prompts the cruel audit executive (CAE) to propose interim changes lo the existing annual audit plan to account for emerging risks.

When of the following is the most appropriate action for the CAE to take regarding the changes made to the audit plan?

35. An internal auditor is conducting a financial audit.

Which of the following audit procedures is most appropriate when existing internal controls are weak?

36. Which of the following is the most important determinant of the objectives and scope of assurance engagements?

37. An internal auditor is conducting a preliminary survey of the investments area, and sends an internal control questionnaire to the management of the function. (An extract of the survey is provided below).

1. Are there any restrictions for any company's investments?

2. Are there any written policies and procedures that document the flow of investment processing?

3. Are investment purchases recorded in the general ledger on the date traded?

4. Is the documentation easily accessible to an persons who need in to perform their job?

Which of the following is a drawback of testing methods like this?

38. An internal auditor is asked to review a recently completed renovation to a retail outlet.

Which of the following would provide the most reliable evidence that the completed work conformed to the plan?

39. Which of the following would not be a typical activity for the chief audit executive to perform following an audit engagement?

40. According to HA guidance, the chief audit executive is directly responsible for which of the following?