Attested IIA-CIA-Part2 Dumps PDF Resource [2024]
Latest IIA-CIA-Part2 Actual Free Exam Questions Updated 465 Questions
NEW QUESTION # 203
According to IIA guidance, which of re following actions should the internal auditor take immediately after having considered fraud scenarios and identified and prioritized fraud risks?
- A. Research frauds that nave occurred t\ similar organizations
- B. Follow protocol for internal reporting and investigating fraud allegations
- C. Incorporate the fraud risk assessment into the engagement plan
- D. Determine which controls if any are in place to mitigate the fraud risks
Answer: D
NEW QUESTION # 204
Which of the following is true of engagement recommendations?
1. Specific suggestions for implementation must be included.
2. The internal auditor's observations and conclusions may serve as the basis.
3. Actions to correct existing conditions or improve operations may be included.
4. Approaches to correcting or enhancing performance may be suggested.
- A. III only
- B. I, III, and IV only
- C. II, III, and IV only
- D. I only
Answer: C
NEW QUESTION # 205
According to the IIA guidance, which of the following foes the engagement work test in a review in a review of an organization al process?
- A. Process controls
- B. Process scope
- C. Process risks
- D. Process objectives
Answer: A
Explanation:
According to the IIA guidance, when reviewing an organizational process, the engagement work test typically focuses on process controls. This involves evaluating the design and effectiveness of controls in place to mitigate identified risks and ensure the achievement of process objectives. Assessing process controls helps auditors determine if the controls are operating as intended and are sufficient to manage the associated risks.
Reference:
The Institute of Internal Auditors (IIA) Standards
Internal Audit Engagement Planning and Execution
NEW QUESTION # 206
According to the Standards, which of the following describes the condition attribute when applied to the observations and recommendations contained in the audit report?
- A. The standards, measures, or expectations used in making an evaluation or verification.
- B. The factual evidence that the internal auditor found in the course of the examination.
- C. The reason for the difference between the expected state and the actual state.
- D. The risk or exposure the organization encounters because the actual state is not consistent with the criteria.
Answer: B
Explanation:
Section: Volume C
NEW QUESTION # 207
An internal audit manager is planning a contract compliance audit Which of the following should be done prior to developing the audit work program?
- A. Assess the inherent risk of paying duplicate invoices
- B. Review the contract for evidence of authorization
- C. Select a sample of invoices for substantive testing
- D. Document underlying reasons for noncompliance
Answer: D
NEW QUESTION # 208
An audit of an organization's claims department determined that a large number of duplicate payments had been issued due to problems in the claims processing system. During the exit conference, the vice president of the claims department informed the auditors that attempts to recover the duplicate payments would be initiated immediately and that the claims processing system would be enhanced within six months to correct the problems. Based on this response, the chief audit executive should:
- A. Monitor the status of corrective action and schedule a follow-up engagement when appropriate.
- B. Discuss the findings with the audit committee and ask the committee to determine the appropriate follow-up action.
- C. Schedule a follow-up engagement within six months to assess the status of corrective action.
- D. Adjust the scope of the next regularly scheduled audit to assess controls within the claims processing system.
Answer: A
Explanation:
Section: Volume B
NEW QUESTION # 209
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?
- A. The CAE should recommend postponing the engagement until the internal audit team is able to develop sufficient knowledge of the new industry
- B. The CAE should ask management to hire an external expert who is familiar with the industry to perform an independent audit for management
- C. The CAE should accept the engagement and hire an external expert to assist the audit team with the audit of the subsidiary
- D. The CAE should accept the engagement and ensure that an explanation of the expertise limitations is included in the final audit report.
Answer: C
Explanation:
According to IIA guidance, if the internal audit team lacks the necessary skills and knowledge to perform an audit, the CAE should consider obtaining external expertise. Accepting the engagement and hiring an external expert allows the internal audit activity to leverage specialized knowledge while fulfilling the audit request.
This approach ensures that the audit is conducted effectively and meets the required standards, while also addressing any competency gaps within the internal audit team.
References:
* Institute of Internal Auditors (IIA) Standards: Attribute Standards 1210: Proficiency
* IIA Practice Guide: Obtaining External Assistance in the Conduct of Internal Auditing
NEW QUESTION # 210
In which of the following ways can the internal audit activity new engagement opportunities?
- A. By looking external factors such as product complaints.
- B. By defining activities by business processes.
- C. By looking at activities by businesses cost centers.
- D. By defining activities by the organization chart.
Answer: B
Explanation:
Defining activities by business processes is a structured approach that allows the internal audit activity to identify engagement opportunities effectively. This method ensures that all critical processes are reviewed systematically and that risks are identified and assessed in the context of how they affect the entire business process. This approach is comprehensive and aligns with best practices in internal auditing.
Reference:
The Institute of Internal Auditors (IIA) Standards
Internal Audit Planning and Engagement Standards
NEW QUESTION # 211
Cross-referencing individual payroll time cards to personnel department records and reports would allow an internal auditor to determine whether:
- A. Individuals are bona fide employees.
- B. Personnel department records agree with payroll accounting records.
- C. Individuals were paid only for time worked.
- D. Individuals were paid at the proper rates.
Answer: A
NEW QUESTION # 212
Which of the following actions by management would reduce an employee's opportunity to commit fraud?
- A. Establishing physical controls over company assets.
- B. Eliminating bonuses tied to sales or other performance goals.
- C. Identifying consequences, such as termination, for fraudulent activities.
- D. Defining ethical behavior expectations in the company handbook.
Answer: A
Explanation:
Section: Volume B
NEW QUESTION # 213
Which of the following manual audit approaches describes testing the validity of a document by following it backward to a previously prepared record?
- A. Reperformance
- B. Tracing
- C. Walkthrough
- D. Vouching
Answer: D
Explanation:
Vouching is the manual audit approach that involves testing the validity of a document by following it backward to a previously prepared record. This method helps auditors verify the authenticity and accuracy of transactions by tracing them back to their source documents, such as invoices, receipts, or purchase orders.
Vouching is commonly used to detect errors or fraud.
References:
* The Institute of Internal Auditors (IIA) Standards
* Auditing Techniques and Procedures
NEW QUESTION # 214
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.
- A. 1, 2, and 4
- B. 1 and 3 only
- C. 2 and 4 only
- D. 2, 3, and 4
Answer: C
Explanation:
When identifying audit resource requirements, the chief audit executive (CAE) should consider approaching an external service provider to conduct internal audits in areas where the organization lacks the necessary skills (2). This ensures that audits are conducted by individuals with the appropriate expertise. Additionally, communicating to senior management a summary report on the status and adequacy of audit resources (4) keeps them informed about the internal audit activity's capacity and any resource constraints. Considering employees from other operational areas as audit resources (1) could compromise objectivity and independence, while suggesting deferral of audits (3) is generally not advisable as it might leave significant risks unaddressed. References: IIA Standard 2030 - Resource Management, IIA Practice Advisory 2030-1
NEW QUESTION # 215
Which of the following best exemplifies having effective risk management and internal control processes?
- A. Risk information is communicated to customers and suppliers
- B. Business profitability is likely to be achieved
- C. All risks are identified and assessed
- D. Relevant risk indicators and mitigation plans are in place
Answer: D
Explanation:
Effective risk management and internal control processes are best exemplified by having relevant risk indicators and mitigation plans in place. This demonstrates that the organization not only identifies and assesses risks but also actively monitors and manages these risks through appropriate mitigation strategies.
The presence of risk indicators and mitigation plans indicates a proactive approach to risk management, ensuring that potential issues are addressed before they can impact the organization significantly.
References:
* The Institute of Internal Auditors (IIA) Standard 2100 - Nature of Work: "The internal audit activity must evaluate and contribute to the improvement of governance, risk management, and control processes using a systematic and disciplined approach."
* COSO Enterprise Risk Management Framework
NEW QUESTION # 216
Which of the following tasks is typically performed in the analysis phase of a benchmarking consulting engagement?
- A. Determining sample size.
- B. Identifying business capabilities.
- C. Determining benchmarked process attributes.
- D. Developing data collection tools.
Answer: C
NEW QUESTION # 217
For which of the following fraud engagement activities would it be most appropriate to involve a forensic auditor?
- A. Preparing evidentiary documentation.
- B. Independently evaluating conflicts of interests.
- C. Performing statistical analysis for data anomalies.
- D. Assessing contracts for relevant terms and conditions.
Answer: A
NEW QUESTION # 218
While conducting an audit of a third party's Web-based payment processor, an internal auditor discovers that a programming error allows customers to create multiple accounts for a single mailing address. Management agrees to correct the program and notify customers with multiple accounts that the accounts will be consolidated. Which of the following actions should the auditor take?
1. Schedule a follow-up review to verify that the program was corrected and the accounts were consolidated.
2. Evaluate the adequacy and effectiveness of the corrective action proposed by management.
3. Amend the scope of the subsequent audit to verify that the program was corrected and that accounts were consolidated.
4. Submit management's plan of action to the external auditors for additional review.
- A. 2 and 3
- B. 1 and 2
- C. 1 and 4
- D. 3 and 4
Answer: B
Explanation:
When an internal auditor discovers an issue such as a programming error allowing multiple accounts for a single address, the auditor should ensure that the corrective actions are both adequate and effective. This includes scheduling a follow-up review (1) to verify that the program has been corrected and that the accounts have been consolidated. Additionally, evaluating the adequacy and effectiveness of the corrective action proposed by management (2) is essential to ensure the issue has been resolved properly. Reference: = IIA Standard 2500 - Monitoring Progress and IIA Standard 2320 - Analysis and Evaluation.
NEW QUESTION # 219
An engagement work program o of greatest value to audit management when which of the following is true?
- A. The work program helps determined the required amount of audit resources
- B. The work program helps ensure tie achievement of the engagement objectives
- C. The work program assists the auditor n developing and managing audit tests
- D. The work program provides more detailed support for the audit report
Answer: A
NEW QUESTION # 220
The internal audit activity of an organization obtained approval to add a senior auditor to its staff. The chief audit executive, audit manager, and audit supervisor each will interview the candidates. According to the Standards, which of the following best explains the involvement of management in the interview process?
- A. Provides audit management with the opportunity to communicate expectations regarding ethical behavior standards.
- B. Allows audit management to explain the criteria that will be used to evaluate the senior auditor's performance.
- C. Enables audit management to outline its quality assurance and improvement program with the senior auditor.
- D. Assists audit management in planning by more effectively allocating the senior auditor to appropriate audits.
Answer: D
NEW QUESTION # 221
In response to an audit finding, senior management informed the auditor that the issue would be investigated and resolved when time permitted. According to the International Professional Practices Framework, this action was not acceptable because:
- A. Other departments should have been contacted to determine if they shared responsibility for corrective action.
- B. The appropriate level of management was not involved in the review and resolution of the issue.
- C. The board had not reviewed management's responses to the engagement observations and recommendations.
- D. Responses should include sufficient information to evaluate the adequacy and timeliness of corrective action.
Answer: D
Explanation:
Section: Volume D
NEW QUESTION # 222
Which of the following statements about internal audit's follow-up process is true?
- A. The nature, timing, and extent of follow-up for assurance engagements is standardized to ensure quality performance.
- B. The actions of external auditors and other external assurance providers is not encompassed by internal audit's follow-up process.
- C. The follow-up process must be complete and documented in the working papers in order to conclude the engagement.
- D. Internal auditors have responsibility for determining if management and the board have implemented the recommended action or otherwise accepted the risk.
Answer: D
NEW QUESTION # 223
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