IIA IIA-CIA-Part1 Quiz 55 Topic 10 Questions 271-275

Question: 1

While performing an internal audit engagement, an auditor reviews a flowchart of the organization's purchasing function. Which of the following internal control weaknesses would the auditor be able to identify in the chart?

AThat purchasing policies have not been updated.

BThat supplier invoices are processed and paid before the goods are received.

CThat the organization is not taking advantage of quantity discounts available from its suppliers.

DThat authorization for payment of goods received has not been granted at the appropriate level.

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Question: 2

In order to be organizationally independent, the chief audit executive should report administratively to the [List A] and functionally to the [List B].

[List A]

[List B]

AAudit committee
Board of directors

BChief executive officer
Board of directors

CChief executive officer
Chief financial officer

DAudit committee
Chief financial officer

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Question: 3

In an audit engagement, a group of internal auditors used an integrated test facility to test payroll processing. The auditors identified the key controls and processing steps in the computer software, and then developed test dat

a. Over the course of 24 months, they submitted test transactions on a regular basis but did not find any differences between payroll processing and integrated test facility results. Based on the data, what can the auditors conclude?

APayments to employees during the 24-month period were all correct.

BThe computer application and its control procedures correctly processed payroll over the 24-month period.

CEmployees are properly submitting their hours to payroll.

DThe computer software is flawed.

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Question: 4

Which of the following factors would cause an internal auditor to judge an account balance error to be material?

AThe error involves an unusual transaction for the organization.

BThe error pertains to an unverified transaction that is routine.

CThe error concerns a data input function.

DThe error involves a large percentage of net income.

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Question: 5

Which of the following procedures would be most effective in detecting fraud in electronically-submitted claims to insurance companies?

ACreating a monitoring program that detects unusual claims to be investigated by the claims department.

BUsing generalized audit software to match the claimant identification number with a master list of valid policyholders.

CTesting the accuracy of processing by using integrated test facilities.

DCreating batch controls over all claims arriving from a particular organization and process those claims separately.

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IIA IIA-CIA-Part1 Quiz:55 Topic:10 Questions:271-275