IIA IIA-CIA-Part2 Quiz 190 Topic 7 Questions 946-950

Question: 1

An internal auditor has uncovered illegal acts committed by a member of senior management. Such information

AShould be excluded from the internal auditor's engagement communication and discussed orally with the senior manager.

BMust be immediately reported to the appropriate government authorities.

CMay be disclosed in a separate communication and distributed to all senior management.

DMay be disclosed in a separate communication and distributed to the board.

Show Answer

Question: 2

Assume with regard to item B, the vice president asks the loan committee to review the loans on an after-the-fact basis. Assume further, upon this subsequent review, the loan committee approves the loans on the after-the-fact basis. Which of the following conclusions is true regarding the communication of the engagement observations?

I The sample deviation rate would drop to 0%.

II The item should still be reported in the audit report because it was not approved in a timely manner in accordance with organizational policies.

iii. The item should be reported as a nondeviation because subsequent action validated the vice president's approach.

AI only.

BII only

CIll only.

DI, II, and Ill.

Show Answer

Question: 3

Regarding the engagement observation concerning an advanced computing security system, what is the most appropriate course of action by the internal auditor?

AEstimate the amount of cost used to develop the advanced security system and inform the outsourcer that it will be a disallowed cost.

BExclude the observation from the engagement communication because the contract was vague and the level of security is clearly acceptable.

CEstimate the added cost, report it to management, and suggest that management meet with its lawyers and the outsourcer to resolve differences.

DCompare the cost with previous costs incurred by governmental operations and inform the outsourcer that the difference will be a disallowed cost.

Show Answer

Question: 4

Branch managers view the internal auditing function as a watchdog for senior management. What is the best way for internal auditing to change this view to one that is more cooperative?

AIncrease focus on control responsibilities.

BIncrease technical skills.

CIncrease confidentiality of investigative engagements to minimize fear.

DIncrease solicitation of engagement client concerns.

Show Answer

Question: 5

An internal auditor determines that actual procedures differ from prescribed control procedures. The internal auditor should

1. Require operating personnel to conform to prescribed procedures.

2.0Document the discrepancies and make any appropriate recommendations to management.

3. Expand all aspects of the engagement to determine other differences from prescribed procedures.

4. Modify the engagement work program as warranted by the differences noted.

A1 and 3.

B2and3.

C1 and 4.

D2 and 4.

Show Answer

IIA IIA-CIA-Part2 Quiz:190 Topic:7 Questions:946-950