Question 1

Which of the following best describes why an internal audit activity would consider sending written preliminary observations to the audit client?

Options :

A : Written observations allow for more interpretation.

B : Written observations help the internal auditors express the significance.

C : Written and verbal observations are equally effective.

D : Written observations limit premature agreement

Answer: C

Question 2

Which of the following is an example of a directive control?

Options :

A : Segregation of duties

B : Exception reports

C : Training programs,

D : Supervisory review.

Answer: C

Question 3

Organizations that adopt just-in-time purchasing systems often experience which of the following?

Options :

A : A slight increase in carrying costs.

B : A greater need for inspection of goods as the goods arrive

C : A greater need for linkage with a vendors computerized order entry system.

D : An Increase in the number of suitable suppliers

Answer: C

Question 4

The internal audit activity is responsible for which of the following actions related to an organization’s internal controls9

Options :

A : Mitigating risks affecting achievement of organizational objectives.

B : Enabling opportunities affecting achievement of organizational objectives.

C : Analyzing and advising regarding costs versus benefits of control activities.

D : Attesting to fairness of financial statements

Answer: C

Question 5

An internal auditor has discovered that duplicate payments were made to one vendor Management has recouped the duplicate payments as a corrective action Which of the following describes managements action in this case?

Options :

A : A condition-based action plan

B : A cause-based action plan.

C : A root cause-based action plan.

D : An effect-based action plan.

Answer: D