IIA IIA-CIA-Part1 Quiz 105 Topic 7 Questions 521-525

Question: 1

An internal quality assessment of the internal audit activity should provide the chief audit executive with.

ARecommendations for improvement.

BObjectives for internal audit engagements.

CConfirmation of action on past audit recommendations.

DAppraisals of internal audit staff performance.

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Question: 2

In the annual audit of the financial statements of a company with high inherent risk and a very strong control system, the external auditor may be able to allow detection risk to rise because.

AAudit risk has been reduced.

BControl risk has been assessed at a lower level.

CThe company's operations are very susceptible to misstatements.

DWhenever inherent risk is high, control risk is disregarded.

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Question: 3

An organization receives the most value from an internal audit activity's enterprise-wide risk assessment when the auditor:

AFocuses primarily on enterprise-level risks.

BConsiders activities at all levels of the organization.

CReviews special projects and new initiatives.

DValidates supporting financial and operational data.

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Question: 4

An organization's external auditor has prepared a list of risks and issues and has recommended to senior management that the internal audit activity focus on these items. Senior management has forwarded the list to the chief audit executive (CAE). The CAE should:

AIncorporate the external auditor's requirements into the internal audit plan.

BIgnore the external auditor's requirements because they are outside of the internal audit activity's planned scope of work.

CConsider the issues raised by the external auditor for possible inclusion in the planned scope of work.

DReport the risks and issues to the audit committee for possible future attention.

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Question: 5

The audit committee has asked the chief audit executive (CAE) to assist in the selection of a new external audit firm. Which of the following is an appropriate action by the CAE?

AThe CAE and two managers from the audit staff review the bids and select one firm to meet with the audit committee for the committee's approval.

BThe CAE develops a formal set of criteria for the audit committee to use in selecting the external auditor.

CThe CAE, chief financial officer, and controller review the bids, interview two firms, and recommend one of the two firms to the audit committee for its approval.

DThe CAE declines to participate in the process because providing this assistance would result in compromising the internal audit activity's objectivity.

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IIA IIA-CIA-Part1 Quiz:105 Topic:7 Questions:521-525