IIA IIA-CIA-Part1 Quiz 53 Topic 7 Questions 261-265

Question: 1

While conducting fieldwork, an internal auditor decides to utilize standard operating procedure (SOP) questionnaires to gather information about a human resources department. Which of the following is an advantage of this method?

ASOP questionnaires verify that a department is efficient and effective.

BSOP questionnaires generally do not need to be cleared by management of the audited department.

CSOP questionnaires are useful in identifying discrepancies and educating clients.

DSOP questionnaires are the most comprehensive technique for data gathering in fieldwork.

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Question: 2

An internal auditor wants to use ratio analysis to examine efficiencies in an organization's accounting department. Which of the following statements identifies a weakness of ratio analysis that should be considered by the auditor?

AIt requires a substantial investment of money.

BIt is only helpful for making comparisons across industries.

CComputer software is required in order to draw conclusions from the data.

DIt utilizes financial information that may not have been checked for validity and reliability.

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Question: 3

A manufacturing organization's multi-step sales and shipping process starts when the organization's headquarters receives the sales order. Headquarters then shares that data with the individual manufacturing facility that compiles the shipment. Finally, the individual manufacturing facility sends the shipments to the customer. Which method should the internal auditor use to document this process in a flowchart?

ATrace the entire process, from the receipt of the sales order at headquarters to when the goods are shipped to the customer.

BRequest a copy of each individual manufacturing facility's flowcharts, speak with facility managers to confirm that they have been updated and then use the information in a flowchart.

CTrace the entire process in reverse, beginning with the shipped goods and ending with the receipt of the sales order at headquarters.

DObtain information on how management sets sales prices, find documentation about how the organization approves the change of sales prices, and prepare an overview flowchart that links the sales price details.

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Question: 4

Internal control processes in an organization require that all investments exceeding $20, 000 receive authorization from both the president and treasurer. After conducting a sample of these transactions, an auditor determined that 10 of the 500 investments in the sample had not included both required authorizations. The sample has a five percent acceptable error rate. Based on this sample, which of the following actions should the auditor take?

AConfirm all of the investments with the organization's internal finance department.

BContact the organization's investment broker and confirm all investments.

CComplete a comprehensive review of the organization's investment activity and compare variations over prior years.

DDetermine that no further testing of investment authorizations is required.

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Question: 5

During an interview with a data-entry clerk in the human resources department, an internal auditor recognizes a potentially significant weakness with a database system used to track employee performance ratings. Which of the following actions should the auditor take after discovering the weakness?

ASchedule a series of follow-up interviews with the data-entry clerk.

BAvoid either directly or indirectly confronting the data-entry clerk about the system weakness.

CQuestion the data-entry clerk indirectly to help obtain more factual information about the weakness.

DImmediately document the weakness and write a report to the data-entry clerk's superior.
Topic 5, Volume E

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IIA IIA-CIA-Part1 Quiz:53 Topic:7 Questions:261-265