Question 1

An internal auditor determined that the extrapolated error from a sample of transactions is greater than the tolerable error. To meet due professional care obligations, the auditor should do which of the following?

Options :

A : Select and test additional samples to identify other errors

B : Use the extrapolated error as the audited value from the testing.

C : Assess the risk that further errors may exist in the data set.

D : Base the final audit opinion on the extrapolated error.

Answer: A

Question 2

Which of the following is not an appropriate role for internal auditors after a disaster occurs?

Options :

A : Monitor the effectiveness of the recovery and control of operations.

B : Correct deficiencies of the entity-s business continuity plan.

C : Recommend future improvements to the entity-s business continuity plan

D : Assist in the identification of lessons learned from the disaster and the recovery operations.

Answer: B

Question 3

Which statement most accurately describes how criteria are established for use by internal auditors in determining whether goals and objectives have been accomplished?

Options :

A : Management is responsible for establishing the criteria.

B : Internal auditors should use professional standards or government regulations to establish the criteria.

C : The industry in which a company operates establishes criteria for each member company through benchmarks and best practices for that industry.

D : Appropriate accounting or auditing standards, including international standards, should be used as the criteria.

Answer: A

Question 4

Which of the following statements best describes internal auditors’ role in fraud detection?

Options :

A : Internal auditors’ roles are similar to those performed by loss prevention managers or fraud investigators.

B : Internal auditors’ demonstration of adequate professional skepticism during an audit engagement is of paramount importance.

C : Internal auditors should consider fraud risks in every assignment and demonstrate due care by detecting fraud instances.

D : Internal auditors should possess a fraud-related body of knowledge, enabling them to carry out preventative and detective measures.

Answer: B

Question 5

Inadequate risk assessment would have the strongest negative impact in which of the following phases of an audit engagement?

Options :

A : Determining the scope.

B : Reviewing internal controls.

C : Testing

D : Evaluating findings.

Answer: A