All About Vivid IIA-CIA-Part1 Questions Pool

NEW QUESTION 1
Which of the following is a requirement for an assurance engagement that may not be for a consulting engagement?

• A. The internal audit activity has to ensure team members' objectivity is not impaired.
• B. Auditors cannot participate in an assurance engagement of a function for which they previously performed a consulting engagement.
• C. The scope and objective of the engagement is agreed upon based on the engagement client's needs.
• D. The internal audit activity must ensure management actions have been implemented effectively or risk accepted.

Answer: B

NEW QUESTION 2
When auditing the award of a major contract, which of the following should an internal auditor suspect as a red flag for a bidding fraud scheme?
* 1. Subsequent change orders increase requirements for low-bid items.
* 2. Material contract requirements are different on the actual contract than on the request for bids.
* 3. A high percentage of employees are charged to indirect accounts.
* 4. Losing bidders are hired as subcontractors.

• A. 1 only
• B. 2 only
• C. 1 and 3.
• D. 2 and 4.

Answer: D

NEW QUESTION 3
An internal auditor who is carrying out an engagement to review controls related to corporate tax reporting must possess which of the following competencies?
* 1. Proficiency in analyzing key IT risks and controls.
* 2. The ability to recognize significant deviations from good business practices.
* 3. Knowledge of key indicators of fraud in tax reporting.
* 4. The ability to recognize the existence of problems related to tax accounting.

• A. 1 and 4 only.
• B. 3 and 4 only.
• C. 2, 3, and 4 only.
• D. 1,2, 3, and 4.

Answer: B

NEW QUESTION 4
Which of the following control activities is the most effective to ensure users' levels of access are appropriate for their current roles?

• A. The human resources department generates a monthly list of terminated and transferred employees and requests IT to update the user access as required.
• B. Standardized user access profiles are developed and the appropriate access profiles are automatically assigned to new or transferred employees.
• C. System administrator rights are assigned to one user in each department who can update user access of terminated or transferred employees immediately.
• D. Department managers are required to perform periodic user access reviews of relevant systems and applications.

Answer: D

NEW QUESTION 5
Which of the following is considered a violation of The IIA's Code of Ethics?

• A. An auditor conveys public information about an organization's financial condition.
• B. An auditor reports a manager's illegal activity to senior management, rather than reporting the incident to the appropriate external authority.
• C. An auditor receives allegations of fraud from a whistleblower and immediately reports the allegations to senior management.
• D. An auditor reports material deficiencies, despite the fact that management is already aware of the defects.

Answer: C

NEW QUESTION 6
According to IIA guidance, which of the following statements is true regarding periodic internal assessments of the internal audit activity?

• A. Internal assessments are conducted to benchmark the internal audit activity's performance againstindustry best practices.
• B. Internal assessments must be performed at least once every five years by a qualified assessor.
• C. An internal auditor may perform a peer review of a colleague's workpapers, as long as the auditor wasn't involved in the audit under review.
• D. Follow-up to ensure appropriate improvements are implemented is a recommended, but not mandatory, element of internal assessments.

Answer: C

NEW QUESTION 7
According to IIA guidance, which of the following external groups is most likely to represent a liability risk, based on activities associated with the organization's corporate social responsibility program?

• A. Consumers.
• B. Activists.
• C. Suppliers.
• D. Investors.

Answer: B

NEW QUESTION 8
Which of the following is most likely to function as a directive control?

• A. Security dogs.
• B. Alert employees.
• C. Insurance claims.
• D. Cycle counts.

Answer: B

NEW QUESTION 9
An organization decides to take no action on one of its financial risks because the cost of implementing the control outweighs the value of the asset being protected. Which of the following best describes this risk strategy?

• A. Risk avoidance.
• B. Risk-benefit analysis.
• C. Risk sharing.
• D. Risk acceptance.

Answer: D

NEW QUESTION 10
In which of the following scenarios would the chief audit executive (CAE) be required to decline the assignment?

• A. The CAE would need to procure external services to deliver the internal audit assurance program.
• B. There is no expertise within the internal audit team for detecting and investigating fraud.
• C. There is no expertise within the internal audit team for auditing an IT engagement.
• D. There is no available expertise on the internal audit team to perform a consulting engagement.

Answer: B

NEW QUESTION 11
Which of the following combinations of conditions is most likely a red flag for fraud?

• A. The practice of surprise audits and the implementation of an employee support program.
• B. Hiring an employee with a prior fraud conviction and yearly management review.
• C. Occasional accounting department overrides and discontinuation of the anonymous fraud hotline due to infrequent use.
• D. A veteran employee in upper management experiencing financial difficulties and recently implemented enhanced controls.

Answer: C

NEW QUESTION 12
An auditor identifies three errors in the sample of 25 entries selected for review (a 12 percent error rate). Based on this result, the auditor assumes that approximately 59 of the total population of 492 entries are incorrect. To reach this assumption, the auditor has used a technique known as which of the following?

• A. Variability tolerance.
• B. Ratio estimation.
• C. Stratification.
• D. Acceptance sampling.

Answer: B

NEW QUESTION 13
A multinational organization has asked the internal audit activity to assist in setting up the organization's risk management system. The chief audit executive (CAE) agrees to take on the engagement as a consultant. Which of the following tasks is appropriate for the CAE to undertake?

• A. Coordinate and facilitate risk workshops for management to attend.
• B. Establish the degree of risk appetite for management to accept.
• C. Set risk indicators and mitigation plans for management to implement.
• D. Determine the number of significant risks for management to report to the board.

Answer: D

NEW QUESTION 14
While preparing for an audit of senior management expenses, the chief audit executive (CAE) learns that management is unable to locate a number of original expense claims to support the related disbursements. She decides to defer the engagement until they can be located. Which of the following principles likely guided the CAE's decision?

• A. Objectivity.
• B. Proficiency.
• C. Independence.
• D. Due professional care.

Answer: D

NEW QUESTION 15
Which of the following best demonstrates the authority of the internal audit activity?

• A. Suggesting alternatives to decision makers.
• B. Improving the integrity of information.
• C. Determining the scope of internal audit services.
• D. Achieving engagement objectives.

Answer: C

NEW QUESTION 16
Which of the following is an example of a management control technique?

• A. A budget.
• B. A risk assessment.
• C. The board of directors.
• D. The control environment.

Answer: A

NEW QUESTION 17
Which of the following controls could an internal auditor reasonably conclude is effective by observing the physical controls of a large server room?

• A. Adequate signs are in place to assist in locating safety equipment.
• B. Servers are secured individually to their racks by locks.
• C. Foam fire extinguishers are operable to protect against electrical fires.
• D. Swipe card access is required to gain access to the server room.

Answer: A

NEW QUESTION 18
Which of the following types of social responsibilities is voluntary and guided purely by the organization's desire to make social contributions?

• A. The bottom of the pyramid responsibility.
• B. Innovative responsibility.
• C. Ethical responsibility.
• D. Discretionary responsibility.

Answer: C

NEW QUESTION 19
Internal auditors must exercise due professional care by considering which of the following?
* 1. Cost of assurance in relation to potential benefits.
* 2. Adequacy and effectiveness of governance, risk management, and control processes.
* 3. Management's competency level in the area being evaluated.
* 4. Probability of significant errors, fraud, or noncompliance.

• A. 1 and 2 only
• B. 1, 2, and 3 only
• C. 1, 2, and 4 only
• D. 2, 3, and 4 only

Answer: C

NEW QUESTION 20
......