IIA IIA-CIA-Part1 Quiz 36 Topic 6 Questions 176-180

Question: 1

An accounts receivable clerk receives cash payments, posts the payments to customer accounts, and prepares the daily cash deposit.

The clerk has been stealing some cash and manipulating the customer payments to hide the theft.

This fraud could be detected with which of the following controls?

AMonthly bank reconciliations are performed by the clerk on a timely basis.

BTotal cash deposits for the month are reconciled to the cash receipts journal.

CNames, amounts, and dates on remittance advices are reconciled with the names, amounts, and dates recorded in the cash receipts journal.

DTotal cash deposits are compared with the bank reconciliation.

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Question: 2

Which of the following conditions is the most likely indicator of fraud?

ACommissions are paid based on verified increases to sales.

BDepartmental reports are consistently issued in an untimely manner.

CA manager regularly assumes subordinates' duties.

DLower earnings occur during the industry's down cycle.

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Question: 3

Which of the following would not be a red flag for fraud?

ASeveral recent, large expenditures to a new vendor have not been documented.

BA manager has bragged about multiple extravagant vacations taken within the last year, which are excessive relative to the manager's salary.

CA weak control environment has been accepted by management to encourage creativity.

DNew employees occasionally fail to meet established project deadlines due to staffing shortages.

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Question: 4

Which of the following is the most significant disadvantage of using checklists to evaluate internal controls?

AThey serve as a reminder of what controls should exist in a process.

BThey require yes/no responses to specific questions, not open-ended responses.

CThey do not capture all controls that may exist.

DThey are useful in assessing risk.

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Question: 5

According to IIA guidance, which of the following objectives of an assurance engagement for the organization's risk management process is valid?

AAll risks have been identified and mitigated.

BRisks have been accurately analyzed and evaluated.

CAll controls are both adequate and efficient.

DThe board is appropriately addressing intolerable risks.

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IIA IIA-CIA-Part1 Quiz:36 Topic:6 Questions:176-180