Jan-2024 FREE IIA IIA-CRMA-ADV PRACTICE QUESTIONS AND ANSWERS UPDATES
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NEW QUESTION # 110
While reviewing first quarter sales transactions, an internal auditor discovered that 10 invoices for a new customer had not been posted into the accounts receivable subsidiary ledger. Those 10 invoices were listed in an error report automatically generated by the sales processing system. The system had rejected the invoices because the customer's account number was not found in the customer master file. In this scenario, which of the following controls was lacking?
- A. Detective control.
- B. Directive control.
- C. Preventive control.
- D. Corrective control.
Answer: D
NEW QUESTION # 111
According to IIA guidance, which of the following objectives of an assurance engagement for the organization's risk management process is valid?
- A. All controls are both adequate and efficient.
- B. All risks have been identified and mitigated.
- C. The board is appropriately addressing intolerable risks.
- D. Risks have been accurately analyzed and evaluated.
Answer: D
NEW QUESTION # 112
Faced with a complex, highly technical construction audit engagement, the chief audit executive (CAE) considered complementing the current internal audit resources by engaging the services of a civil engineer.
Which of the following should the CAE consider in determining whether the engineer possesses the necessary skills to perform the engagement?
1. Professional certification, license, or other recognition of the engineer's competence in the relevant discipline.
2. Experience of the engineer in the type of work being considered.
3. Compensation or other incentives that the engineer may receive.
4. The extent of other ongoing services that the engineer may be performing for the organization.
- A. 3 and 4 only
- B. 2 and 3 only
- C. 1 and 4 only
- D. 1, 2, and 4 only
Answer: D
NEW QUESTION # 113
The manager for an organization's accounts payable department resigned her post in that capacity. Three months later, she was recruited to the internal audit activity and has been working with the audit team for the last eight months. Which of the following assignments would the newly hired internal auditor be able to execute without any impairments to independence or objectivity?
- A. A review of the employees' sports club finances, which are overseen by the chief audit executive.
- B. A consulting engagement related to a new accounts payable optimization initiative.
- C. An assurance review for a sales program on which she previously provided consultation.
- D. An operations audit of the accounts payable department.
Answer: A
NEW QUESTION # 114
While preparing for an audit of senior management expenses, the chief audit executive (CAE) learns that management is unable to locate a number of original expense claims to support the related disbursements. She decides to defer the engagement until they can be located. Which of the following principles likely guided the CAE's decision?
- A. Independence.
- B. Objectivity.
- C. Due professional care.
- D. Proficiency.
Answer: C
NEW QUESTION # 115
Which of the following is an example of a transaction-level control?
- A. Reconciliations of primary accounts.
- B. Tone at the top.
- C. Inventory counts.
- D. Human resource policies.
Answer: A
NEW QUESTION # 116
Which of the following statements accurately describes an internal auditor's responsibility with regard to due professional care?
- A. An internal auditor's opinion should be based on factual evidence.
- B. An internal auditor's opinion should be limited to the effectiveness of internal controls.
- C. An internal auditor's opinion should be based on experience and free of all bias.
- D. An internal auditor should express an opinion only when consensus with top management has been achieved.
Answer: A
NEW QUESTION # 117
According to IIA guidance, which of the following statements about working papers is false?
- A. They provide support for communication to third parties.
- B. They contribute to development of the internal audit staff.
- C. They assist in the implementation of recommendations.
- D. They demonstrate compliance with auditing standards.
Answer: C
NEW QUESTION # 118
According to the IIA guidance, who is responsible for periodically assessing the internal audit activity?
- A. Senior management.
- B. The external auditors.
- C. The chief audit executive.
- D. The board.
Answer: C
NEW QUESTION # 119
An organization is beginning to implement an enterprise risk management program. One of the first steps is to develop a common risk language. Which of the following statements about a common risk language is true?
- A. Stakeholders will have more assurance that the risks are assessed consistently.
- B. Decision makers will understand that the likelihood of missing or ineffective controls will be reduced.
- C. Internal auditors will be able to reduce their sample sizes because controls will be more consistent.
- D. Management will be able to reduce inherent risk because they will have a better understanding of risk.
Answer: A
NEW QUESTION # 120
Which of the following control activities is the most effective to ensure users' levels of access are appropriate for their current roles?
- A. Department managers are required to perform periodic user access reviews of relevant systems and applications.
- B. System administrator rights are assigned to one user in each department who can update user access of terminated or transferred employees immediately.
- C. Standardized user access profiles are developed and the appropriate access profiles are automatically assigned to new or transferred employees.
- D. The human resources department generates a monthly list of terminated and transferred employees and requests IT to update the user access as required.
Answer: A
NEW QUESTION # 121
Which the following activities should be performed by the internal audit activity to facilitate an effective relationship with the audit committee?
1. Periodically report about the accounting standards followed by the organization.
2. Provide assurance to the audit committee that its charter, activities, and processes are appropriate.
3. Ensure that the role and activities of the internal audit activity are clearly understood and responsive to the needs of the audit committee.
4. Maintain open and effective communications with the audit committee.
- A. 2, 3, and 4 only
- B. 3 and 4 only
- C. 1, 3, and 4 only
- D. 1 and 2 only
Answer: A
NEW QUESTION # 122
An accounts receivable clerk receives cash payments, posts the payments to customer accounts, and prepares the daily cash deposit.
The clerk has been stealing some cash and manipulating the customer payments to hide the theft.
This fraud could be detected with which of the following controls?
- A. Monthly bank reconciliations are performed by the clerk on a timely basis.
- B. Total cash deposits are compared with the bank reconciliation.
- C. Total cash deposits for the month are reconciled to the cash receipts journal.
- D. Names, amounts, and dates on remittance advices are reconciled with the names, amounts, and dates recorded in the cash receipts journal.
Answer: D
NEW QUESTION # 123
During an audit, the client questions the internal audit activity's authority to perform procedures over fraud allegations. According to HA guidance, which of the following would provide the most relevant support to respond to the client's concerns?
- A. Internal audit charter.
- B. The IIA's Code of Ethics.
- C. MA Standards.
- D. Definition of Internal Auditing.
Answer: A
NEW QUESTION # 124
A chief audit executive (CAE) of an international charity reports functionally to the audit committee of the board of directors and administratively to the charity's chief financial officer (CFO).
Which of the following would impair the internal audit function's independence?
- A. The CFO determines the scope of internal audit work in the accounting department.
- B. The CFO provides feedback on the CAE's audit reports.
- C. The CFO administers the annual evaluation process for the internal auditors.
- D. The CFO manages the accounting of the budget for the internal audit function.
Answer: A
NEW QUESTION # 125
Which of the following are components of the ISO 31000 risk management process?
1. Setting the context.
2. Risk treatment.
3. Risk avoidance.
4. Communication.
- A. 3 and 4.
- B. 1,2, and 4.
- C. 1 and 2 only.
- D. 2 and 3.
Answer: C
NEW QUESTION # 126
An IT contractor applied for an internal audit position at a bank. The contractor worked for the bank's IT security manager two years ago. If the audit manager interviewed the contractor and wants to extend a job offer, which of the following actions should the chief audit executive pursue?
- A. Not allow the audit manager to hire the contractor, as it would be a conflict of interest.
- B. Not allow the audit manager to hire the contractor and ask the individual to apply again in one year.
- C. Allow the audit manager to hire the contractor and state that the individual is free to perform IT audits, including security.
- D. Allow the audit manager to hire the contractor, but state that the individual is not allowed to work on IT security audits for one year.
Answer: C
NEW QUESTION # 127
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