IIA IIA-CIA-Part2 Quiz 169 Topic 3 Questions 841-845

Question: 1

The chief audit executive should ensure follow-up of prior engagement observations and recommendations

ATo determine if corrective action was taken and is achieving the desired results.

BUnless management rejected the recommendation in its initial response.

CUnless the engagement work schedule does not allow time for follow-up.

DUnless management has accepted the recommendation.

Show Answer

Question: 2

An internal auditing engagement communication disclosed a substantial annual loss to the organization because the purchasing department had no procedures manual. In light of this observation, which of the following actions should the internal audit activity take?

ATake no further action, because the internal audit activity's duty is completed with the publication of the final report.

BWrite the procedures manual because the purchasing department clearly needs the help, and the internal audit activity can provide it.

CMake recommendations regarding the procedures manual, then perform a follow-up engagement to assure that corrective action is taken or that senior management or the board takes the responsibility for not taking action.

DRequire that the purchasing department develop or otherwise obtain a suitable procedures manual, then check to make sure that they do so. The purchasing department's responsibility is to ensure that such a manual is in use.

Show Answer

Question: 3

When actions have not been taken by management on reported engagement observations, conclusions, and recommendations, the internal auditor should

ADetermine whether management or the board has assumed the risk for not taking corrective action.

BDevelop and implement a plan of corrective action.

CWithhold communications about other related engagement observations, conclusions, and recommendations until corrective action is taken.

DConclude that the engagement observations, conclusions, and recommendations are insignificant and no corrective action is necessary.

Show Answer

Question: 4

An audit of an organization's claims department determined that a large number of duplicate payments had been issued due to problems in the claims processing system. During the exit conference, the vice president of the claims department informed the auditors that attempts to recover the duplicate payments would be initiated immediately and that the claims processing system would be enhanced within six months to correct the problems. Based on this response, the chief audit executive should

AAdjust the scope of the next regularly scheduled audit of the claims department to assess controls within the claims processing system.

BMonitor the status of corrective action and schedule a follow-up engagement when appropriate.

CSchedule a follow-up engagement within six months to assess the status of corrective action.

DDiscuss the findings with the audit committee and ask the committee to determine the appropriate follow-up action.

Show Answer

Question: 5

When conducting audit follow-up of a finding related to cash management routines, which of the following does not need to be considered?

AInherent risk has been eliminated as a result of resolution of the condition.

BThe steps being taken are resolving the condition disclosed by the finding.

CControls have been implemented to deter or detect a recurrence of the finding.

DBenefits have accrued to the entity as a result of resolving the condition.

Show Answer

IIA IIA-CIA-Part2 Quiz:169 Topic:3 Questions:841-845