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Question No. 1
Upon joining the internal audit activity, each new auditor
receives a copy of the audit handbook.Which of the following
handbook policies has the greatest risk of compromising audit
objectivity?
A. Internal auditors should obtain 80 hours of continuing
professional education every twoyears, 20 of which should be
audit-related, and the remainder may be operations-related.B.
Internal auditors should rotate to other areas of the organization
for nonaudit assignmentsto gain an understanding of the
organization's operations.C. Internal auditors should have direct
and unrestricted access to personnel and informationthroughout the
organization and the governing board.D. Internal auditors should
undergo annual performance appraisals conducted by the chiefaudit
executive, who reports administratively to the chief financial
officer.
Answer: B
Question No. 2
According to IIA guidance, which of the following roles would be
appropriate for an internal auditorregarding fraud risk?
1. Identification.
2. Mitigation.
3. Remediation.
4. Reduction.
A. 1 only. |B. 1 and 4 only.C. 1, 3, and 4 only.D. 1,2, 3, and
4.
Answer: B
Question No. 3
During an audit engagement, the internal auditor discussed a
risk mitigation recommendation withthe manager of the area under
review. The manager disagreed with the risk assessment
andrecommendation. The two failed to come up with an alternative
solution, and the auditor decided toproceed with including the
original recommendation in the engagement report. Which of
thefollowing is especially important in dealing with this type of
situation?
A. Soft skills in communication, negotiation, and
collaboration.B. Technical skills in the area under review.C.
Professional qualifications and certification in internal
auditing.D. Confidentiality and independence.
Answer: A
Question No. 4
According to the International Professional Practices Framework,
which of the following are
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allowable activities for an internal auditor?
1. Advocating the establishment of a risk management
function.
2. Identifying and evaluating significant risk exposures during
audit engagements.
3. Developing a risk response for the organization if there is
no chief risk officer.
4. Benchmarking risk management activities with other
organizations.
5. Documenting risk mitigation strategies and techniques.
A. 4 and 5 only.B. 1.2, and 3 only.C. 1.2. 4. and 5 only.D. 2.
3. 4. and 5 only.
Answer: C
Question No. 5
Which of the following is an example of a risk management
avoidance response?
A. Exiting a marketplace.B. Recalling a product.C. Obtaining
product insurance.D. Outsourcing production.
Answer: A
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