Question 1

Which of the following statements is not true about risk registers and risk profiles?

Options :

A : b) Risk registers change and risk profiles do not change over a time period.

B : c) Risk registers show current risks and residual risks.

C : d) Risk ownership is derived from risk profiles.

D : a) Risk profiles provide a mechanism for prioritizing risk treatment efforts.

Answer: A

Question 2

According to the IIA Standards, reported audit findings emerge by a process of comparing “what should be” with “what is.” In determining “what should be” during an audit of a company's treasury function, which of the following would be the least desirable criteria against which to judge current operations?

Options :

A : B.Company policies and procedures delegating authority and assigning responsibilities.

B : C.Finance textbook illustrations of generally accepted good treasury function practices.

C : D.Codification of best practices of the treasury function in relevant industries.

D : A.The operations of the treasury function as documented during the last audit.

Answer: D

Question 3

An internal auditor most likely will have a conflict of interest by providing an assurance service with regard to a

Options :

A : Purchasing activity if a major supplier is owned by the internal auditor’s sister-in-law.

B : Data processing center for which the internal auditor had performed the service three times previously.

C : Financial activity in which the internal auditor had been a key employee 5 years previously.

D : Computer system for which the internal auditor had been the internal audit activity’s representative on the design team.

Answer: A

Question 4

The effectiveness of an internal auditing engagement is related to the results and the action taken on those results. Which of the following activities contributes to engagement effectiveness?

Options :

A : B.Adhering to a time budget.

B : A.Conducting an exit meeting with engagement clients.

C : C.Preparing weekly time reports.

D : D.Having budget revisions approved by the project supervisor.

Answer: B

Question 5

A charter is being drafted for a newly formed internal audit activity. Which of the following best describes an appropriate organizational position to be incorporated into the charter?

Options :

A : The chief audit executive is a staff officer reporting to the chief financial officer.

B : The chief audit executive reports to the chief executive officer but has access to the board.

C : The chief audit executive is a member of the board.

D : The chief audit executive reports to an administrative vice president.

Answer: B