IIA IIA-CFSA Quiz 6 Topic 2 Questions 26-30

Question: 1

Financial institutions regularly identify uncollectible and charge them off against the reserve for loan losses. Auditors should ensure that the institution has developed adequate criteria for

charge-offs and select a sample of charged-off loans whether they are handled properly.

Another useful test is:

ATo select a sample of loans that are significantly paid inorder to determine whether they meet the charge-off criteria and assess why they have not been charged off

BTo select a sample of loans that are significantly paid in order to determine whether they
meet the past criteria and assess why they have not been charged off

CTo select a sample of loans that are significantly paid in order to determine whether they
meet the charge-off criteria and assess why they have not been charged off

DTo select a sample of loans that are significantly paid in order to determine whether they
meet the charge-off criteria to meet the current requirements

Show Answer

Question: 2

Pension Benefit Guarantee Corporation (PBGC) insures ''Defined benefit plan'', so employees assume _____________ for any option they contribute.

ALow Investment Risk

BHigh Investment Risk

CNo Investment Risk

DStable Investment Risk

Show Answer

Question: 3

Demand deposit account allows customers to transfer money through the use of:

AChecks

BATMs and EFTs

CPoint of sale (POS) terminals

DAll of these

Show Answer

Question: 4

Not all misstatements will be material enough to affect the fair presentation of the financial statement. A material misstatement is one that the auditors determine would change or influence the option of a reasonable person relying on the financial statements for information. Ultimately, auditors must exercise judgment to assess materiality based on the qualitative nature of the misstatements and their quantitative extent. Materiality is also based on auditors' assessment of control risk levels in the organization. The following factors may influence the auditors' assessment of control risk EXCEPT:

AManagement's awareness or lack of awareness of applicable laws and regulations

BClient policy regarding such matters as acceptable operating practices and codes of conduct

CAssignment of responsibility and delegation of authority to deal with such matters as
organizational goals and objectives, operating functions, and regulatory requirements

DNone of these

Show Answer

Question: 5

''Insurers guarantee a minimum rate of interest dunning the time that the account is growing and periodic payment amounts of a specified amount for a stated period (either specific period 10 years indefinite period etc).'' This statement is related to:

AVariable annuities

BLife time annuities

CTerm period annuities

DFixed annuities

Show Answer

IIA IIA-CFSA Quiz:6 Topic:2 Questions:26-30