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1. According to IIA guidance, which of the following statements best justifies a chief audit executive's request for external consultants to complement internal audit activity (IAA) resources?

2. According to the IIA guidance, which of the following foes the engagement work test in a review in a review of an organizational process?

3. Internal control questionnaires are used to achieve which of the following objectives?

4. While conducting a review of the logistics department the internal audit team identified a crucial control weakness. The chief audit executive (CAE) decided to prepare an audit memorandum for management of the logistics department followed by an informal meeting.

What is the most likely reason the CAE decided to prepare the audit memorandum?

5. An organization recently acquired a subsidiary in a new industry, and management asked the chief audit executive (CAE) to perform a comprehensive audit of the subsidiary prior to recommencing operations. The CAE is unsure her team has the necessary skills and knowledge to accept the engagement According to IIAguidance, which of the following responses by the CAE would be most appropriate?

6. Which of the following is the primary reason the chief audit executive should consider the organization's strategic plans when developing the annual audit plan?

7. According to IIA guidance, when of the Mowing statements is true regarding an engagement supervisor's use of review notes?

8. Which of the following is the most important concept to be included in a consulting engagement agreement?

9. After the team member who specialized in fraud investigations left the internal audit team, the chief audit executive decided to outsource fraud investigations to a third party service provider on an as needed basis.

Which of the following is most likely to be a disadvantage of this outsourcing decision?

10. Which of the following statement is consistent with IIA guidance the use of mentoring for internal auditors?

11. Which of the following situations would justify the removal of a finding from the final audit report?

12. Acceding to IIA guidance, when of the Mowing is an assurance service commonly performed by the internal audit activity?

13. Which of the following statements is true regarding the final assurance engagement report issued to management?

14. When constructing a staffing schedule for the internal audit activity (IAA), which of the following criteria are most important for the chief audit executive to consider for the effective use of audit resources?

1. The competency and qualifications of the audit staff for specific assignments.

2. The effectiveness of IAA staff performance measures.

3. The number of training hours received by staff auditors compared to the budget.

4. The geographical dispersion of audit staff across the organization.

15. An internal auditor wants to identity potential ghost employees in the organization's payroll system.

The auditor extracts the following data

- Human resources data with employees' names addresses employment conditions and identification codes

- Payroll data

- Logs from entrance systems

With this data, which of the following types of ghost employees will the auditor be able to identify?

16. Which of the following best illustrates the primary focus of a risk-based approach to control self-assessment?

17. An internal auditor recommended that an organization implement computerized controls in its sales system in order to prevent sales representatives from executing contracts in excess of their delegated authority levels A follow-up review found that the sales system had not been modified, but a process had been implemented to obtain written approval by the vice president of sales for all contracts in excess of S1 million.

The chief audit executive (CAE) would be justified in reporting this situation to the organization's board under which of the following circumstances'?

1. In the opinion of the CAE the level of residual risk assumed by senior management is too high

2. Testing of compliance with the new process finds that all new contracts in excess of $1 million have been approved by the vice president of sales

3. The cost of modifying the sales system to include a preventive control is less than

S100.000

18. Which of the following statements describes an engagement planning best practice?

19. An internal auditor uses a data query tool in the purchasing process to review the vendor master file for authorizations.

Which of the following describes the control objective likely being tested?

20. What is the best course of action for a chief audit executive if an internal auditor identifies in the early stage of an audit that some employees have inappropriate access to a key system?

21. According to the Standards, which of the following is least important in determining the adequacy of an annual audit plan?

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

23. An internal auditor suspects that employee turnover is unusually high at the organization's primary manufacturing plant.

To investigate this potential issue which of the following analytical approaches is the auditor likely to use?

24. If observed during fieldwork by an internal auditor, which of the following activities is least important to communicate formally to the chief audit executive?

25. An organization s inventory is stored m multiple warehouses. During an inventory audit which of the following activities would most benefit from the use of computerized audit tools?

26. Which of the following actions are appropriate for the chief audit executive to perform when identifying audit resource requirements?

1. Consider employees from other operational areas as audit resources, to provide additional audit coverage in the organization.

2. Approach an external service provider to conduct internal audits on certain areas of the organization, due to a lack of skills in the organization.

3. Suggest to the audit committee that an audit of technology be deferred until staff can be trained, due to limited IT audit skills among the audit staff.

4. Communicate to senior management a summary report on the status and adequacy of audit resources.

27. Which of the following factors would the auditor in charge be least likely to consider when assigning tasks to audit team members for an engagement?

28. During follow-up. the internal auditor discovered that operational management did not implement effective actions to address a significant control breach If the issue is left unresolved it may result in regulatory sanctions and damage the organization's reputation What is the most appropriate next step for the chief audit executive to lake?

29. Which of the following is an appropriate documentation of proper engagement supervision?

30. An internal auditor is testing the success of the IT support department in meeting the service levels guaranteed to small, medium and large customers. The customer's size classification is based on its annual expenditures with the organization and the nature and extent of services it receives.

Which of the following sampling techniques would be the most suitable to select customers for this test?

31. According to IIA guidance, which of the following are the most important objectives for helping to ensure the appropriate completion of an engagement?

1. Coordinate audit team members to ensure the efficient execution of all engagement procedures.

2. Confirm engagement workpapers properly support the observations, recommendations, and conclusions.

3. Provide structured learning opportunities for engagement auditors when possible.

4. Ensure engagement objectives are reviewed for satisfactory achievement and are documented properly.

32. As a result of server managements assumption of risk there is residual risk that exceeds me organisation's risk appetite.

Which of the following actions would be most appropriate for the chief audit executive to take?

33. According to IIA guidance which of the following statements is true regarding the annual audit plan?

34. According to IIA guidance, which of the following statements are true regarding the internal audit plan?

1. The audit plan is based on an assessment of risks to the organization.

2. The audit plan is designed to determine the effectiveness of the organization's risk management process.

3. The audit plan is developed by senior management of the organization.

4. The audit plan is aligned with the organization's goals.

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

36. The audit manager asked the internal auditor to perform additional testing because several irregularities were found in the financial information.

Which of the following would be the most appropriate analytical review for the auditor to perform?

37. An internal auditor is analyzing sates records and is concerned whether a transaction is recorded in the coned period. The accounting manager explains that the external auditor approved the records and produces an email from the external audit team leader.

How should tie internal auditor respond?

38. Which of the following would most likely cause an internal auditor to consider adding fraud work steps to the audit program?

39. A chief audit executive (CAE) reviews the supervision of an internal audit engagement.

Which of the following would most likely assure the CAE that the engagement had adequate supervision?

40. Which of the following actives is an internal auditor most likely to perform when establishing the objectives of an assurance engagement?