IIA IIA-CIA-Part1 Quiz 83 Topic 9 Questions 411-415

Question: 1

During the planning phase of an audit of suspected overbilling on contracts for security services, an internal auditor should perform all of the following except:

AInterview an official of the security services company to determine the cause of recent increases in billings for services.

BInterview the manager who requested the audit engagement.

CObtain a copy of the contract between the two organizations.

DPrepare an engagement program.

Show Answer

Question: 2

In preparing for an audit of the footwear division of a major retail organization, an internal auditor gathered the following information about the organization's stores:

q2_IIA-CIA-Part1

In addition to labor costs, the other costs associated with each store are leasing and maintenance expenses. Which of the following is a valid conclusion?

ASales per store are directly related to the size of the store.

BEmployees are less productive in larger stores.

CGross margin is directly related to the size of the store.

DCost of goods sold is directly related to the size of the store.

Show Answer

Question: 3

Which of the following internal control weaknesses would an internal auditor most likely detect while reviewing a flowchart that depicts the purchasing function of an organization?

APurchasing policies have not been updated.

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

CPayments for goods received have not been authorized at the appropriate level.

DPayments to suppliers are made before goods are received.

Show Answer

Question: 4

An internal auditor pays to participate in the company's annual golf tournament, which is held outside of normal business hours.

The auditor wins the putting contest and is awarded an all-expense-paid weekend vacation.

According to the IIA Code of Ethics regarding objectivity, the auditor's best course of action would be to:

ARefuse the prize because the amount is significant.

BAccept the prize because the event was held outside of normal business hours.

CRefuse the prize because it represents an impairment to objectivity.

DAccept the prize because the auditor received no special treatment.

Show Answer

Question: 5

An internal auditor audited a department store's cash function. Which of the following actions would indicate a lack of due professional care by the auditor?

ABased on a well-designed system of internal controls over the cash function, the audit report assured senior management that no irregularities existed.

BA flowchart of the entire cash function was developed but only samples of transactions were tested.

CThe audit report included a well-supported recommendation for a reduction in staff even though such a reduction might adversely impact morale.

DThe auditor informed appropriate authorities within the organization about suspected wrongdoing but did not inform external authorities.

Show Answer

IIA IIA-CIA-Part1 Quiz:83 Topic:9 Questions:411-415