Question 1

Which of the following actions are appropriate for the chief audit executive to perform when identifying audit

resource requirements?

1. Consider employees from other operational areas as audit resources, to provide additional audit coverage in

the organization.

2. Approach an external service provider to conduct internal audits on certain areas of the organization, due to

a lack of skills in the organization.

3. Suggest to the audit committee that an audit of technology be deferred until staff can be trained, due to

limited IT audit skills among the audit staff.

4. Communicate to senior management a summary report on the status and adequacy of audit resources.

Options :

A : 1 and 3 only

B : 2 and 4 only

C : 1, 2, and 4

D : 2, 3, and 4

Answer: B

Question 2

During a review of the treasury function an internal auditor identified a risk that all bank accounts may net to include in the daily reconciliation process. Which of the following responses would be most effective to mitigate this risk?

Options :

A :

The treasury supervisor establishes a threshold for amounts on bank statements to be reconciled against data in the system

B :

The treasury analyst performs a daily reconciliation of al bank statements obtained via email against data in the system

C :

The treasury analyst reviews a daily report automatically generated by the treasury system, which shows bank statements that have not been uploaded into the accounting system.

D :

The treasury supervisor seeks an annual confirmation from the bank regarding the bank statements processed within a year

Answer: C

Question 3

According to IIA guidance, which of the following would be considered necessary for a one-person audit function?

Options :

A : A formalized technical audit manual

B : A written administrative audit manual

C : A memorandum stating policies and procedures

D : A comprehensive policy and procedure manual

Answer: C

Question 4

During an internal audit engagement, which of the following is true regarding the decision to use statistical sampling or nonstatistical sampling?

Options :

A : The decision affects the test procedures performed.

B : The auditor-s response to errors detected will be influenced.

C : The competence of the evidence obtained is greater with statistical sampling.

D : Nonstatistical sampling may be more cost effective.

Answer: A

Question 5

Senior IT management requests the internal audit activity to perform an audit of a complex IT area. The chief audit executive (CAE) knows that the internal audit activity lacks the expertise to perform the engagement. Which of the following is the most appropriate action for the CAE to take?

Options :

A :

Decline the audit engagement, because the Standards prohibit internal auditors from performing engagements where they lack the necessary competencies.

B :

Accept the audit engagement and use the engagement as an opportunity to develop the audit team-s IT expertise while performing the audit work.

C :

Temporarily hire an experienced and knowledgeable IT analyst from the organization-s IT department to lead the audit.

D : Outsource the audit engagement to a reputable IT audit consulting firm.

Answer: D

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