Free IIA IIA-ACCA Practice Exam with Questions & Answers | Set: 10

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Questions 136

The chief audit executive (CAE) is planning to conduct an internal assessment of the internal audit activity (IAA). Part of this assessment will include benchmarking. According to IIA guidance, which of the following qualitative metrics would be appropriate for the CAE to use?

1. Average client customer satisfaction score for a given year.

2. Client survey comments on how to improve the IAA.

3. Auditor interviews once an audit has been completed.

4. Percentage of audits completed within 90 days.

Options:

1 and 2.

1 and 3.

2 and 3.

3 and 4.

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Questions 137

An internal auditor wants to sample data to test an audit theory in a cost-effective way. Which of the following sampling strategies should she use?

Options:

Statistical sampling only

Nonstatistical sampling only

A combination of both statistical and nonstatistical sampling.

Neither approach to testing the audit theory would be cost effective.

Questions 138

According to IIA guidance, the results of a formal quality assessment should be reported to which of the following groups?

Options:

The audit committee and senior management.

The audit committee and the external auditors.

Senior management and management of the audited area.

Senior management and the external auditors.

Questions 139

Sometimes, internal audit staff may partner with operating managers to rank risks. Which of the following outcomes may be the most beneficial aspects of this strategy?

1. Reappraising risks levels.

2. Providing accurate information to management.

3. Marketing the internal audit activity.

4. Planning safeguards for assets in high-risk areas.

Options:

1 and 2.

1 and 3.

2 and 3.

3 and 4.

Questions 140

According to IIA guidance, which of the following should be included in the internal audit charter?

Options:

The minimum resources and competencies needed for the internal audit activity.

Identification of the organizational units where engagements are to be performed.

Organizational relationships and reporting lines.

Assigned responsibilities for designing and implementing controls.

Questions 141

The chief audit executive (CAE) of a small internal audit activity (IAA) performs all high-risk engagements on the annual audit plan to make use of his knowledge and experience and to maximize the efficient use of audit resources. Which of the following statements is most relevant regarding this practice?

Options:

The CAE's work may be reviewed by any other experienced staff member within the IAA.

The CAE's work should be reviewed by an individual with the appropriate background and knowledge.

The CAE may self-review his work, provided he discloses this practice in the final report.

The CAE should avoid performing engagements to ensure he is able to review all audit work objectively.

Questions 142

Which of the following statements is true with regard to conducting an effective quality assurance and improvement program?

Options:

The IIA's Quality Assessment Manual for the Internal Audit Activity must be used as the basis for periodic assessments.

Members of the internal audit activity are not permitted to perform quality assessments, as they would not be independent.

Periodic internal assessments provide the most current and independent recommendations for improvement.

The conclusions of periodic internal assessments are intended to assist in achieving conformity to the Standards.

Questions 143

An organization is facing a financial downturn and needs to impose major budget reductions to all departments. According to MA guidance, which of the following actions is most appropriate for the board to take to evaluate the potential impact on the internal audit activity?

Options:

Ask management to determine which internal audit engagements are lower risk and could be considered for removal from the annual audit plan.

Ask appropriate stakeholders for their opinion on the potential impacts of reducing the scope of the internal audit plan.

Ask the chief audit executive to determine whether budgetary limitations impede the ability of the internal audit activity to execute its responsibilities.

Ask The human resources department to determine how the annual compensation and salary of the audit staff could be adjusted to achieve savings.

Questions 144

Which of the following is an example of collusion?

Options:

An employee includes a faked receipt in his expense claim, and the claim is signed by the employee's manager.

A vendor inflates the price of an item and remits a portion of the excess to the purchasing manager.

A vendor sends a duplicate invoice with a new invoice number, and the accounts payable system fails to detect the duplication.

An employee works with the IT manager to develop a program for identifying duplicate invoice payments.

Questions 145

Click the Exhibit.

IIA-ACCA Question 145

Internal auditors are asked to keep track of how many hours per day they spend planning the audit, conducting the engagement, and writing the audit report. The data for two days has been collected as follows:

Day 1

Day 2

Planning the audit

2 hours

3 hours

Conducting the engagement

1 hour

Writing the audit report

2 hours

4 hours

Which of the following graphs depicts the data accurately?

Options:

Graph A only

Graph B only

Both A and B.

Neither A nor B.

Questions 146

Which of the following would be the most appropriate first step for the board to take when developing an effective system of governance?

Options:

Determine the organization's overall risk appetite.

Establish a governance committee.

Delegate authority to members of senior management.

Identify key stakeholders and their expectations.

Questions 147

Which of the following describes a key characteristic related to effective organizational communication?

Options:

Comprehensive supervisory and verification procedures.

A well-designed system of internal controls.

A culture of integrity and transparency.

Unique operating environments with varying complexity.

Questions 148

With regard To IT governance, which of the following is the most effective and appropriate role for the internal audit activity?

Options:

Independently evaluate the skills and experience of potential chief information officer candidates to assess the best fit based on the organization's risk appetite.

Evaluate the organization's governance standards and assess IT-related activities to identify gaps and develop policies, ensuring alignment with the organization's risk appetite.

Assist management in interpreting complex IT-related privacy and security risk exposures and evaluating potential mitigation strategies.

Assess whether governance activities are aligned with the organization's risk appetite and take into consideration emerging risks.

Questions 149

An internal audit team is performing an audit of workplace accident claims.

Which of the following actions by the audit team best demonstrates due professional care?

Options:

Having an occupational health officer on the engagement team.

Determining that the claims have been classified properly.

Placing reliance on medical reports from the injured worker's doctor.

Reviewing claims to ensure all accidents actually occurred in the workplace.

Questions 150

A new director was hired to lead the internal audit activity at a small start-up company. Which of the following assignments would impair the director's independence?

Options:

Preparing the financial statements for the company's defined contribution plan.

Performing a pre-implementation review of the company's payroll application.

Providing the COBIT framework as a possible IT management tool.

Reviewing the company's policy for foreign currency translation adjustments for compliance with accounting standards.