Question 1

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 are

a. It was corrected immediately.

Options :

A : 1 and 3 only

B : 1 and 4 only

C : 2 and 3 only

D : 2 and 4 only

Answer: B

Question 2

An IT contractor applied for an internal audit position at a bank. The contractor worked for the bank's IT security manager two years ago. If the audit manager interviewed the contractor and wants to extend a job offer, which of the following actions should the chief audit executive pursue?

Options :

A : Allow the audit manager to hire the contractor and state that the individual is free to perform IT audits, including security.

B : Not allow the audit manager to hire the contractor, as it would be a conflict of interest.

C : Allow the audit manager to hire the contractor, but state that the individual is not allowed to work on IT security audits for one year.

D : Not allow the audit manager to hire the contractor and ask the individual to apply again in one year.

Answer: A

Question 3

The internal audit activity completed an initial risk analysis of the organization's data storage center and found several areas of concern. Which of the following is the most appropriate next step?

Options :

A : Risk response.

B : Risk identification.

C : Identification of context.

D : Risk assessment.

Answer: D

Question 4

A software that translates hypertext markup language (HTML) documents and allows a user to view a remote web page is called:

Options :

A : A transmission control protocol/Internet protocol (TCP/IP).

B : An operating system.

C : A web browser.

D : A web server.

Answer: C

Question 5

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?

Options :

A : The corporate risk register.

B : The strategic plan.

C : Internal and external audit reports.

D : The board-s meeting records.

Answer: B