IIA-CIA-Part1 Practice Test

When reviewing management reports to the board of directors,the internal audit activityshould:

A.

Evaluate the process used to prepare the management reports.

B.

 Maintain supporting documentation for the management reports.
 

C.

Tie all financial numbers in the reports to the general ledger.

D.

Compare to prior-period reports for consistency.

Internal auditors can benefit from a strong relationship with the external auditors because external auditors can:

A.

Provide internal auditors with an independent and knowledgeable viewpoint.

B.

Concur with the internal auditors' reports and thus improve the quality of assurance
provided to management.

C.

Increase the effectiveness of internal control sampling techniques.

D.

Assist the internal auditor by providing information obtained from similar audits with other clients.

Which of the following is true with respect to the risk assessment process?

A.

The ethical climate should not be included since this factor cannot be measured quantitatively.

B.

More than one risk factor may have to be used to ensure that the risk assessment is comprehensive.

C.

Each risk factor should be given equal weighting in order to reduce the opportunity for bias.

D.

The risk assessment process should be conducted at least every three years.

When reviewing operational risk for a department whose manager adopts a laissez-faire
style of leadership,it is most important for the internal auditor to verify that:

A.

Employee decisions follow department and company guidelines.

B.

The manager considers employees' input when designing new procedures.

C.

Employees are empowered to deal with unusual or emergency situations.

D.

Management has adopted an open-door policy to assist with communication.

Which of the following statements regarding organizational governance is not correct?

A.

An effective internal audit function is one of the four cornerstones of good governance.

B.

Those performing governance activities are accountable to the customer.

C.

Accountability is one of the key elements of organizational governance.

D.

Governance principles and the need for an internal audit function are applicable to
governmental and not-for-profit activities.