Question 1

To effectively communicate the acceptance of risk in an organization a chief audit executive must first consider which of the following?

Options :

A : The organization-s view on risk tolerance

B : The organization-s principal risk events.

C : The organization-s risk response strategies

D : The organization-s major control activities

Answer: A

Question 2

A chief audit executive's report to the board showed a significant trend of recent aud4s going over planned budgeted hours. Which of the following factors could cause this trend?

Options :

A : Poor engagement supervision

B : ineffective board reporting

C : Untimely observation follows up and closure

D : Limited staff resources

Answer: A

Question 3

An internal auditor is planning a consuming engagement and the objective is to identify opportunities to improve the efficiency of the organization’s procurement process. The auditor is preparing to conduct a preliminary survey of the area. Which of the following approaches would be most useful to obtain relevant information to support the engagement objective?

Options :

A :

Complete a transaction walkthrough fiat focuses on the design and operation of financial reporting controls

B :

Conduct interviews with senior management to obtain their input and insights regarding operational controls.

C :

Perform a comprehensive review of the organization s existing policies and standard operating procedures.

D :

Review the procurement process map w*h employees who carry out key activities to obtain their input and insights.

Answer: D

Question 4

Which of the following is a primary reason for an internal auditor to use a risk and control questionnaire when auditing financial processes?

Options :

A : To gam an understanding of the control environment

B : To collect as much financial data as possible before engagement fieldwork begins.

C : To test the effectiveness of financial controls in an efficient and relatively inexpensive way

D : To facilitate the quantification of financial data obtained

Answer: A

Question 5

Which of the following best describes external benchmarking using trend analysis for a subsidiary of an international company?

Options :

A :

Comparing the current ratio of the subsidiary with the current ratio of another company for the same period

B :

Comparing common-size financial statements of the subsidiary with the averages of the industry for the last two periods

C : Comparing the sales of the subsidiary with the sales of another subsidiary for the last two periods.

D : Comparing the sales of the subsidiary with the budgeted figures for the last two periods

Answer: B

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