Question 1

An organization references a customer order with an approved customer file and credit limit before accepting an order. Which type of control does this process exemplify?

Options :

A : Quality control monitoring.

B : Direct functional management.

C : Information processing.

D : Performance indicators.

Answer: C

Question 2

Which of the following principles of The IIA's Code of Ethics implies that internal auditors should refrain from performing assurance services when there is an impairment to audit independence that has not been declared?

Options :

A : Confidentiality.

B : Objectivity.

C : Integrity.

D : Competency..

Answer: B

Question 3

Which of the following would have the least impact (either positive or negative) on an assessment of a department's control environment?

Options :

A : The department managed long-term investments, including investment in derivatives and other financial instruments, to maximize return.

B : The department manager sets a tone of honesty and integrity in all business dealings and this tone is emulated by department personnel.

C : Many department functions were duplicated or verified by other department employees as part of the department-s normal procedures.

D : Audit tests designed to verify compliance with control procedures detected a general failure to follow standard procedures for transaction authorization.

Answer: A

Question 4

At what point in time can an organization conclude that the established organizational governance framework was correctly implemented?

Options :

A : When the internal auditor conducts observations and fieldwork.

B : When management completes the risk assessment.

C : When the internal auditor evaluation shows its soundness.

D : When the organization’s goals and objectives are met.

Answer: D

Question 5

An internal auditor is reviewing tender documents for a maintenance contract. She notices that the bidder who won a recent tender has been winning tenders for the past decade despite many other qualified and well-established maintenance companies participating in the tender bids. The price offers from this bidder are consistently slightly lower than other bidders' prices, and this bidder always submits their bid just before the deadline. How should the auditor respond to these findings?

Options :

A : Seize the laptops of employees related to the tender to secure a chain of custody

B : Carry out a forensic examination of tender documents and submitted offers to identify signs of falsification.

C : Conduct a guilt-admission interview with the procurement specialist who has most likely leaked prices of other bidders.

D : Consult the organizational fraud response plan and notify her supervisor of the potential red flags.

Answer: D

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