Question 1

Which of the following are the most appropriate measures for evaluating the change in an organization's liquidity position?

Options :

A : Times interest earned, return on assets, and inventory turnover.

B : Accounts receivable turnover, inventory turnover in days, and the current ratio.

C : Accounts receivable turnover, return on assets, and the current ratio.

D : Inventory turnover in days, the current ratio, and return on equity.

Answer: B

Question 2

Which audit approach should be employed to test the accuracy of information housed in a database on an un-networked computer?

Options :

A : Submit batches of test transactions through the current system and verify with expected results.

B : Use a test program to simulate the normal data entering process.

C : Select a sample of records from the database and ensure it matches supporting documentation.

D : Evaluate compliance with the organization-s change management process.

Answer: C

Question 3

Which of the following activities would come last in the development and implementation of a privacy and data protection program?

Options :

A : Selecting the privacy and data protection framework

B : Establishing an assessment and communication format

C : Defining the scope of implementation procedures

D : Defining the privacy and data protection risks

Answer: B

Question 4

An internal auditor wishes to test why there was a significant drop in accounts payable volume last month and creates several scenarios to help explain the anomaly. Which of the following best describes this data analysis technique?

Options :

A : Descriptive

B : Diagnostic

C : Predictive

D : Prescriptive

Answer: B

Question 5

An organization had three large centralized divisions: one that received customer orders for service work; one that scheduled the service work at customer locations; and one that answered customer calls about service problems. These three divisions were restructured into seven regional groups, each of which performed all three functions. One advantage of this restructuring would be:

Options :

A : Better internal controls.

B : Greater economies of scale.

C : Improved work flow.

D : Increased specialization.

Answer: C

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