Free PECB ISO-IEC-42001-Lead-Auditor Practice Exam with Questions & Answers | Set: 5

What type of audit risk is described in the last paragraph of Scenario 4?

Scenario 4: Finalogic leads the application of artificial intelligence in the financial services sector, which is used to improve risk assessment, fraud detection, and

customer service. The company has implemented an artificial intelligence management system AIMS based on ISO/IEC 42001 to ensure operational quality, ethical Al

use, regulatory compliance, and transparency, allowing for consistent oversight and structured governance.

This month, Finalogic is undergoing an audit to obtain certification against ISO/IEC 42001, a critical step in demonstrating its commitment to responsible Al. To

evaluate Finalogic's conformity to the audit criteria, the audit team adopted a comprehensive, evidence-based approach. The gathered evidence ranged from analyses

of unquantifiable information to analyses of samples related to determining the audit criteria-including internal reports generated by Finalogic's own Al system-which

assert successful integration and compliance with the standard.

Additionally, presentations by the company’s Al team during the audit highlighted the system’s success in customer service enhancements and fraud detection,

emphasizing improved efficiency, decision making accuracy, and user trust. An evaluation report prepared by an independent third party firm specializing in Al systems

also provided an objective review of Finalogic's AIMS. It assessed the system's effectiveness, bias, and compliance through a thorough examination.

During the audit, the audit team applied the same level of effort and utilized the same techniques across all audit areas, regardless of their risk level. This strategy

ensured a consistent and thorough evaluation of the AIMS, uncovering any latent weaknesses or inefficiencies that might otherwise go unnoticed.

Despite Finalogic's advanced AIMS and adherence to ISO/IEC 42001 for ethical Al practices, there remains a risk of Al algorithms inadvertently perpetuating bias or

making inaccurate predictions due to unforeseen flaws in training data or algorithmic models. This could lead to unfair loan rejections or approvals, potentially causing

financial losses or damaging the company’s reputation for fairness and accuracy in its financial services. By acknowledging these risks. Finalogic remains committed

to refining its Al governance, implementing bias mitigation strategies, and enhancing transparency to uphold its reputation as a leader in Al driven financial services.

How does ISO 19011 recommend auditors select audit criteria?

Scenario 7 (continued):

Scenario 7: ICure, headquartered in Bratislava, is a medical institution known for its use of the latest technologies in medical practices. It has introduced groundbreaking Al-driven diagnostics and treatment planning tools that have fundamentally transformed patient care.

ICure has integrated a robust artificial intelligence management system AIMS to manage its Al systems effectively. This holistic management framework ensures that ICure's Al applications are not only developed but also deployed and maintained to adhere to the

highest industry standards, thereby enhancing efficiency and reliability.

ICure has initiated a comprehensive auditing process to validate its AIMS's effectiveness in alignment with ISO/IEC 42001. The stage 1 audit involved an on-site evaluation by the audit team. The team evaluated the site-specific conditions, interacted with ICure's personnel,

observed the deployed technologies, and reviewed the operations that support the AIMS. Following these observations, the findings were documented and communicated to ICure. setting the stage for subsequent actions.

Unforeseen delays and resource allocation issues introduced a significant gap between the completion of stage 1 and the onset of stage 2 audits. This interval, while unplanned, provided an opportunity for reflection and preparation for upcoming challenges.

After four months, the audit team initiated the stage 2 audit. They evaluated AIMS's compliance with ISO/IEC 42001 requirements, paying special attention to the complexity of processes and their documentation. It was during this phase that a critical observation was made:

ICure had not fully considered the complexity of its processes and their interactions when determining the extent of documented information. Essential processes related to Al model training, validation, and deployment were not documented accurately, hindering effective control and management of these critical activities. This issue was recorded as a minor nonconformity, signaling a need for enhanced control and management of these vital activities.

Simultaneously, the auditor evaluated the appropriateness and effectiveness of the "AIMS Insight Strategy," a procedure developed by

ICure to determine the AIMS internal and external challenges. This examination identified specific areas for improvement, particularly in

the way stakeholder input was integrated into the system. It highlighted how this could significantly enhance the contribution of relevant

parties in strengthening the system's resilience and effectiveness.

The audit team determined the audit findings by taking into consideration the requirements of ICure, the previous audit records and

conclusions, the accuracy, sufficiency, and appropriateness of evidence, the extent to which planned audit activities are realized and

planned results achieved, the sample size, and the categorization of the audit findings. The audit team decided to first record all the

requirements met; then they proceeded to record the nonconformities.

Based on the scenario above, answer the following question:

Question:

Did the audit team consider all the necessary aspects when determining audit findings?

In which step are the audit findings, including nonconformities, documented and reviewed?

Scenario 2 (continued):

Empsy HR Solutions is a human resources consulting company that provides innovative HR solutions to diverse industries. Recognizing the significant impact of artificial intelligence Al in HR processes, including its ability to automate repetitive tasks, analyze vast amounts of data for insights, improve recruitment and talent management strategies, and personalize employee experiences, the company has initiated the implementation of an artificial intelligence management system AIMS based on ISO/IEC 42001.

Initially, the top management established an Al policy that was aligned with the company's objectives. The Al policy provided a framework for defining Al objectives, a commitment to meeting relevant requirements, and a dedication to continually improve the AIMS. However, it

did not refer to other organizational policies, although some were relevant to the AIMS. Afterward, the top management documented the policy, communicated it internally, and made it accessible to interested parties.

The top management designated specific individuals to ensure that the AIMS meets the standard's requirements. Additionally, they ensured that these individuals were responsible for overseeing the AIMS, reporting its performance to the top management, and facilitating continual improvement. Moreover, in its awareness sessions, the company focused exclusively on ensuring that all personnel

were informed about the Al policy, emphasizing their role in ensuring the effectiveness of the AIMS and the benefits of enhanced Al performance.

The company also planned, implemented, and monitored processes to meet AIMS requirements. Additionally, it set clear criteria and implemented controls based on them, ensuring effective operation, alignment with organizational objectives, and continual improvement. Empsy HR Solutions decided to implement strict measures to control changes to documented information within the AIMS. To ensure the integrity and accuracy of documentation, the company adopted version control practices. Each document update was tracked using a versioning system, with clear records of what was modified, who made the changes, and when the updates occurred. Access to make changes was restricted to authorized personnel, and any proposed modifications required approval from the designated management team before being implemented.

Moreover, considering past experiences where the company encountered unforeseen risks, Empsy HR Solutions established a comprehensive Al risk assessment process. This process involved identifying, analyzing, and evaluating Al risks to determine if it is necessary to implement additional controls than those specified in Annex A. The company also referred to Annex B for guidance on implementing controls and, ultimately, produced a Statement of Applicability So A. The SoA contained the necessary controls, including all the controls of Annex A and justifications for their inclusion or exclusion.

Lastly. Empsy HR Solutions decided to establish an internal audit program to ensure the AIMS conforms to both the company's requirements and ISO/IEC 42001. It defined the audit objectives, criteria, and scope for each audit, selected auditors, and ensured objectivity and impartiality during the audit process. The results of the first audit were documented and reported only to the top

management of the company.

Question:

Does the company's implementation of version control practices for documented information align with the requirements of ISO/IEC 42001?

Based on Scenario 1, which AI principle did NeuraGen fail to apply?

Scenario: NeuraGen, founded by a team of AI experts and data scientists, has gained attention for its advanced use of artificial intelligence. It specializes in developing personalized learning platforms powered by AI algorithms. MindMeld, its innovative product, is an educational platform that uses machine learning and stands out by learning from both labeled and unlabeled data during its training process. This approach allows MindMeld to use a wide range of educational content and personalize learning experiences with exceptional accuracy. Furthermore, MindMeld employs an advanced AI system capable of handling a wide variety of tasks, consistently delivering a satisfactory level of performance. This approach improves the effectiveness of educational materials and adapts to different learners' needs.

NeuraGen skillfully handles data management and AI system development, particularly for MindMeld. Initially, NeuraGen sources data from a diverse array of origins, examining patterns, relationships, trends, and anomalies. This data is then refined and formatted for compatibility with MindMeld, ensuring that any irrelevant or extraneous information is systematically eliminated. Following this, values are adjusted to a unified scale to facilitate mathematical comparability. A crucial step in this process is the rigorous removal of all personally identifiable information (PII) to protect individual privacy. Finally, the data is subjected to quality checks to assess its completeness, identify any potential bias, and evaluate other factors that could impact the platform's efficacy and reliability.

NeuraGen has implemented an advanced artificial intelligence management system (AIMS) based on ISO/IEC 42001 to support its efforts in AI-driven education. This system provides a framework for managing the life cycle of AI projects, ensuring that development and deployment are guided by ethical standards and best practices.

NeuraGen's top management is key to running the AIMS effectively. Applying an international standard that specifically provides guidance for the highest level of company leadership on governing the effective use of AI, they embed ethical principles such as fairness, transparency, and accountability directly into their strategic operations and decision-making processes.

While the company excels in ensuring fairness, transparency, reliability, safety, and privacy in its AI applications, actively preventing bias, fostering a clear understanding of AI decisions, guaranteeing system dependability, and protecting user data, it struggles to clearly define who is responsible for the development, deployment, and outcomes of its AI systems. Consequently, it becomes difficult to determine responsibility when issues arise, which undermines trust and accountability, both critical for the integrity and success of AI initiatives.

During an audit, the auditor uncovers sensitive data regarding the AI system's algorithms and their decision-making processes. Which principle must the auditor adhere to when handling this information?

How frequently should surveillance audits be conducted?

Question:

ReePharm, a pharmaceutical company, has decided to incorporate its AI risk management into the information security management system (ISMS) to identify and address risks related to the procurement, manufacturing, and distribution of pharmaceutical products. Is this decision appropriate?

Question:

Which statement most accurately characterizes semantic computing?