IIA-ACCA IIA ACCA CIA Challenge Exam exact Exam Questions

ACCA CIA Challenge Exam

Last Update 14 hours ago Total Questions : 604

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Question # 1

When establishing a quality assurance and improvement program, the chief audit executive should ensure the program is designed to accomplish which of the following objectives?

1. Add value.

2. Improve operations.

3. Provide assurance that the internal audit activity conforms with the Standards.

4. Provide assurance that the internal audit activity conforms with the IIA Code of Ethics.

1 only

1 and 2 only

1 and 3 only

1, 2, 3, and 4

Question # 2

Which of the following must be in existence as a precondition to developing an effective system of internal controls?

A monitoring process.

A risk assessment process.

A strategic objective-setting process.

An information and communication process.

Question # 3

A large retail organization, which sells most of its products online, experiences a computer hacking incident. The chief IT officer immediately investigates the incident and concludes that the attempt was not successful. The chief audit executive (CAE) learns of the attack in a casual conversation with an IT auditor. Which of the following actions should the CAE take?

1. Meet with the chief IT officer to discuss the report and control improvements that will be implemented as a result of the security breach, if any.

2. Immediately inform the chair of the audit committee of the security breach, because thus far only the chief IT officer is aware of the incident.

3. Meet with the IT auditor to develop an appropriate audit program to review the organization ' s Internet-based sales process and key controls.

4. Include the incident in the next quarterly report to the audit committee.

1 and 2

1 and 3

2 and 4

3 and 4

Question # 4

Which of the following statements is true pertaining to interviewing a fraud suspect?

1. Information gathered can be subjective as well as objective to be useful.

2. The primary objective is to obtain a voluntary written confession.

3. The interviewer is likely to begin the interview with open-ended questions.

4. Video recordings always should be used to provide the highest quality evidence.

1 only

4 only

1 and 3

2 and 4

Question # 5

An internal auditor performed a review of IT outsourcing and found that the service provider was failing to meet the terms of the service level agreement. Which of the following approaches is most appropriate to address this concern?

The organization should review the skill requirements and ensure that the service provider is maintaining sufficient expertise and retaining skilled resources.

The organization should proactively monitor the performance of the service provider, escalate concerns, and use penalty clauses in the contract where necessary.

The organization should ensure that there is a clear management communication strategy and path for evaluating and reporting on all outsourced services concerns.

The organization should work with the service provider to review the current agreement and expectations relating to objectives, processes, and overall performance.

Question # 6

Which of the following items should the chief audit executive disclose to senior management regarding the results of the internal audit activity ' s quality assessments?

The internal audit activity ' s plan for resource allocation.

The amount of the organization ' s potential loss prevented by the risk-based auditing of the internal audit activity.

The number of audits from the annual internal audit plan that were completed last year.

The qualifications and independence of the assessment Team.

Question # 7

According to IIA guidance, which of the following procedures would be least effective in managing the risk of payroll fraud?

The employee’s name listed on organization’s payroll is compared to the personnel records.

Payroll time sheets are reviewed and approved by the timekeeper before processing.

Employee access to the payroll database is deactivated immediately upon termination.

Changes to payroll are validated by the personnel department before being processed.

Question # 8

According to IIA guidance, which of the following statements is true regarding the reporting of results from an external quality assessment of the internal audit activity?

The external assessment results are reported upon completion in confidence directly to the board, and senior management is advised only of the recommendations and improvement action plans.

The results of self-assessments with independent external validation are shared with the board upon completion, and monitoring of recommended improvements must be reported monthly.

The external assessment results are communicated upon completion to senior management and the board, but action plans for recommended improvements do not have to be reported.

The requirements for reporting quality assessment results are the same for external assessments and self-assessments with independent external validation.

Question # 9

Which of the following is not an outcome of control self-assessment?

Informal, soft controls are omitted, and greater focus is placed on hard controls.

The entire objectives-risks-controls infrastructure of an organization is subject to greater monitoring and continuous improvement.

Internal auditors become involved in and knowledgeable about the self-assessment process.

Nonaudit employees become experienced in assessing controls and associating control processes with managing risks.

Question # 10

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.

1 and 3 only

1 and 4 only

2 and 3 only

2 and 4 only

Question # 11

When developing the scope of an audit engagement, which of the following would the internal auditor typically not need to consider?

The need and availability of automated support.

The potential impact of key risks.

The expected outcomes and deliverables.

The operational and geographic boundaries.

Question # 12

The chief audit executive of a medium-sized financial institution is evaluating the staffing model of the internal audit activity (IAA). According to IIA guidance, which of the following are the most appropriate strategies to maximize the value of the current IAA resources?

• The annual audit plan should include audits that are consistent with the skills of the IAA.

• Audits of high-risk areas of the organization should be conducted by internal audit staff.

• External resources may be hired to provide subject-matter expertise but should be supervised.

• Auditors should develop their skills by being assigned to complex audits for learning opportunities.

1 and 2 only

1 and 4 only

2 and 3 only

3 and 4 only

Question # 13

An audit client responded to recommendations from a recent consulting engagement. The client indicated that several recommended process improvements would not be implemented. Which of the following actions should the internal audit activity take in response?

Escalate the unresolved issues to the board, because they could pose significant risk exposures to the organization.

Confirm the decision with management and document this decision in the audit file.

Document the issue in the audit file and follow up until the issues are resolved.

Initiate an assurance engagement on the unresolved issues.

Question # 14

An internal auditor is conducting a review of the procurement function and uncovers a potential conflict of interest between the chief operating officer and a significant supplier of IT software development services. Which of the following actions is most appropriate for the internal auditor to take?

Inform the audit supervisor.

Investigate the potential conflict of interest.

Inform the external auditors of the potential conflict of interest.

Disregard the potential conflict, because it is outside the scope of the audit assignment.