IIA IIA-CIA-Part1 Quiz 69 Topic 4 Questions 341-345

Question: 1

Which type of documentary evidence gathered by an organization's internal auditors has the highest level of reliability?

AInventory test counts.

BBank statements.

CRemittance advices.

DWritten policy statements.

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Question: 2

An internal auditor is testing, on a sample basis, whether invoices paid between January 1 and December 31 are supported by appropriately approved purchase orders. Over 25, 000 invoices were paid during the fiscal year, which runs from the first of April to the end of March. The auditor sets the acceptable risk of assessing control risk too low at 5% and the tolerable deviation rate at 5%. The internal auditor consults the previous audit and sets the expected population deviation rate at 1%. Sample size (77) is selected from a table and rounded up to 80. No sample deviations were found. The upper deviation limit was 3.7%.

Which of the following statements represents a valid conclusion regarding this information?

AI am 95% confident that the true, but unknown, population deviation rate is less than or equal to 3.7%. Results indicated that the sample size was too small, as no sample deviations were found.

BI am 95% confident that the actual population deviation rate is 3.7%. Since this is less than the tolerable deviation rate, quantitative attribute testing results indicate that the control is effective.

CI am 95% confident that the true, but unknown, population deviation rate is less than or equal to 3.7%. The quantitative attribute testing results indicate that the control is effective.

DI am 95% confident that the true, but unknown, population deviation rate is less than or equal to 3.7%. The quantitative attribute testing results indicate that the control is not effective.

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Question: 3

Which of the following is not considered one of the most common red flags for perpetrators of fraud?

AExcessive control issues.

BRepeat performance issues.

CUnusually close association with customers.

DExperiencing financial difficulty.

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Question: 4

Which of the following is a component of the internal audit value proposition endorsed by IIA guidance?

AInsight.

BIndependence.

CIntegrity.

DCompetency.

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Question: 5

The chief audit executive needs to revise the internal audit activity's (IAA) charter. The revision must address the element of authority.

Which of the following statements meets this requirement?

AThe IAA shall identify and assess all potential risks to the operations of the organization.

BThe IAA shall be granted access to all records relevant to the performance of its duties.

CFollowing its assessment, the IAA shall recommend risk control processes and resource management strategies.

DThe IAA shall deliver an initial report of its findings to the organization's board within 120 days of the beginning of the engagement.

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IIA IIA-CIA-Part1 Quiz:69 Topic:4 Questions:341-345