NEW QUESTION 122
A computer system automatically locks a user’s account after three unsuccessful attempts to log on.
Which type of control does this scenario represent?

NEW QUESTION 123
An auditor in charge was reviewing the workpapers submitted by a newly hired internal auditor. She noted that the new auditor’s analytical work did not include any rating or quantification of the risk assessment results, and she returned the workpapers for correction. Which section of the workpapers will the new auditor need to modify?

NEW QUESTION 124
Given the highly technical and legal nature of privacy issues, which of the following statements best describes the internal audit activity’s responsibility with regard to assessing an organization’s privacy framework?

NEW QUESTION 125
According to The IIA’s Code of Ethics, which of the following statements is true?

NEW QUESTION 126
Which of the following statements best explains why internal auditors map processes?
1. To obtain audit evidence to support auditor’s observations.
2. To determine scope and objectives of the audit.
3. To facilitate the identification of ownership and responsibility for key risks.
4. To identify potential efficiency improvements.

NEW QUESTION 127
An organization is facing a financial downturn and needs to impose major budget reductions to all departments. According to MA guidance, which of the following actions is most appropriate for the board to take to evaluate the potential impact on the internal audit activity?

NEW QUESTION 128
Why is a code of ethics for the internal audit profession necessary?

NEW QUESTION 129
Which of the following is a common type of payroll fraud?

NEW QUESTION 130
Which of the following statements describes impairment to the internal auditor’s objectivity?

NEW QUESTION 131
An internal audit charter, approved by the board, restricts the internal audit activity to providing assurance only on the reliability of financial information and the effectiveness of internal accounting controls. Which of the following statements is true regarding the extent to which the external auditor may rely on the internal audit activity’s work?

NEW QUESTION 132
A chief audit executive (CAE) learns that the brother-in-law of a senior auditor who audits the procurement process was hired as the head of the procurement department six months prior. Which of the following is the most appropriate action for the CAE to take?

NEW QUESTION 133
Why are preventative controls generally preferred to detective controls?

NEW QUESTION 134
An internal auditor is conducting an engagement in the accounts payable department, which includes expressing an opinion at the micro level. According to IIA guidance, which of the following statements is true regarding micro-level opinions?
1. They are most effective when using a combination of current and prior engagement findings to draw conclusions.
2. They typically are based on defined procedures such as those found in an accounts payable reconciliation process.
3. They are discrete and not normally shared with senior management or the board.
4. They can rely on evidence taken from the work of other assurance activities across the organization.

NEW QUESTION 135
An internal audit team is performing an audit of workplace accident claims.
Which of the following actions by the audit team best demonstrates due professional care?

NEW QUESTION 136
A manufacturing line supervisor joins the internal audit activity for a two-year rotational job assignment and is assigned to an accounts receivable audit. With regard to this assignment, which of the following should be the primary concern of the audit manager?

NEW QUESTION 137
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?

NEW QUESTION 138
While auditing an organization’s credit approval process, an internal auditor learns that the organization has made a large loan to another auditor’s relative. Which course of action should the auditor take?

NEW QUESTION 139
Which of the following enhances the independence of the internal audit activity?

NEW QUESTION 140
An internal auditor uses a predefined macro provided in a popular spreadsheet application to verify the present value of the organization’s investments. Which of the following is the most appropriate course of action regarding the auditor’s use of this functionality?

NEW QUESTION 141
A manufacturing organization discovers that the waste water released has failed to meet permitted limits.
Which control function will be least effective in correcting the issue?

NEW QUESTION 142
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?

NEW QUESTION 143
What is the primary benefit to the internal audit activity for undertaking an internal quality assessment?

NEW QUESTION 144
During an audit, the client questions the internal audit activity’s authority to perform procedures over fraud allegations. According to HA guidance, which of the following would provide the most relevant support to respond to the client’s concerns?

NEW QUESTION 145
Which of the following is a detective control strategy against fraud?