[Oct-2021] Updated CIA Challenge IIA-ACCA Exam Questions BUNDLE PACK
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NEW QUESTION 150
Which of the following descriptions of the internal control system are indicators that risks are managed effectively?
1. Existing controls promote compliance with applicable laws and regulations.
2. The control environment is designed to address all identified risks to the organization.
3. Key controls for significant risks to the organization remain consistent over time.
4. Monitoring systems are in place to alert management to unexpected events.
- A. 1 and 3.
- B. 2 and 4.
- C. 2 and 3.
- D. 1 and 4.
Answer: D
NEW QUESTION 151
Which of the following behaviors could represent a significant ethical risk if exhibited by an organization's board?
1. Intervening during an audit involving ethical wrongdoing.
2. Discussing periodic reports of ethical breaches.
3. Authorizing an investigation of an unsafe product.
4. Negotiating a settlement of an employee claim for personal damages.
- A. 1 and 2
- B. 3 and 4
- C. 2 and 3
- D. 1 and 4
Answer: D
NEW QUESTION 152
Which of the following statements is true about The IIA Global Internal Audit Competency Framework?
- A. The core competencies outlined in the framework are not expected of a person undertaking an entry-level position as an internal auditor.
- B. The framework is designed to be used primarily by chief audit executives that are developing indicators to measure the performance of the internal audit activity for which they are responsible.
- C. The framework lists the core competencies internal auditors should possess before attempting to attain The IIA's Certified Internal Auditor certification.
- D. The framework describes competencies needed for individual internal auditors, but not those necessary at the chief audit executive level.
Answer: B
NEW QUESTION 153
Which of the following is an effective approach for internal auditors to take to improve collaboration with audit clients during an engagement?
1. Obtain control concerns from the client before the audit begins so the internal auditor can tailor the scope accordingly.
2. Discuss the engagement plan with the client so the client can understand the reasoning behind the approach.
3. Review test criteria and procedures where the client expresses concerns about the type of tests to be conducted.
4. Provide all observations at the end of the audit to ensure the client is in agreement with the facts before publishing the report.
- A. 1 and 2 only
- B. 3 and 4 only
- C. 2 and 3 only
- D. 1 and 4 only
Answer: A
NEW QUESTION 154
According to MA guidance on IT. which of the following would be considered a primary control for a spreadsheet to help ensure accurate financial reporting?
- A. The spreadsheet is stored on a network server that is backed up daily.
- B. Check-in and check-out software is used to control versions.
- C. The purpose and use of the spreadsheet are documented.
- D. Formulas and static data are locked or protected.
Answer: D
NEW QUESTION 155
Management would like to self-assess the overall effectiveness of the controls in place for its 200-person manufacturing department. Which of the following client-facilitated approaches is likely to be the most efficient way to accomplish this objective?
- A. Surveys.
- B. Interviews.
- C. Workshops.
- D. Observation.
Answer: A
NEW QUESTION 156
A large investment organization hired a chief risk officer (CRO) to be responsible for the organization's risk management processes. Which of the following people should prioritize risks to be used for the audit plan?
- A. The CRO, because he is responsible for coordinating and project managing risk activities based on his specialized skills and knowledge.
- B. The chief audit executive, although he is not accountable for risk management in the organization.
- C. The CEO, because he has ultimate responsibility for ensuring that risks are managed within the agreed tolerance limits set by the board.
- D. Operational management, because they are responsible for the day-to-day management of the operational risks.
Answer: B
NEW QUESTION 157
An internal auditor performed a review of IT outsourcing and found that the service provider was failing to meet the terms of the service level agreement. Which of the following approaches is most appropriate to address this concern?
- A. The organization should proactively monitor the performance of the service provider, escalate concerns, and use penalty clauses in the contract where necessary.
- B. The organization should review the skill requirements and ensure that the service provider is maintaining sufficient expertise and retaining skilled resources.
- C. The organization should work with the service provider to review the current agreement and expectations relating to objectives, processes, and overall performance.
- D. The organization should ensure that there is a clear management communication strategy and path for evaluating and reporting on all outsourced services concerns.
Answer: A
NEW QUESTION 158
A credit card company detects potential errors in credit card numbers by checking whether all entered numbers contain the correct amount of digits. This is an example of which of the following IT controls?
- A. Balancing control activities.
- B. Data integrity tests.
- C. Check digits.
- D. Logic test.
Answer: D
NEW QUESTION 159
Which of the following describes the most appropriate set of tests for auditing a workstation's logical access controls?
- A. Review the list of people who attempted to access the workstation and failed, as well as error messages.
- B. Review the passwords of those who attempted unsuccessfully to access the workstation and the log of their activity.
- C. Review the list of people with access badges to the room containing the workstation and a log of those who accessed the room.
- D. Review the password length, frequency of change, and list of users for the workstation's login process.
Answer: C
NEW QUESTION 160
According to IIA guidance, which of the following must internal auditors consider to conform with the requirements for due professional care during a consulting engagement?
1. The cost of the engagement, as it pertains to audit time and expenses in relation to the potential benefits.
2. The needs and expectation of clients, including the nature, timing, and communication of engagement results.
3. The application of technology-based audit and other data analysis techniques, where appropriate.
4. The relative complexity and extent of work needed to achieve the engagement's objectives.
- A. 1, 2, and 3
- B. 1, 2, and 4
- C. 1, 3, and 4
- D. 2, 3, and 4
Answer: B
NEW QUESTION 161
While conducting an audit of a third party's Web-based payment processor, an internal auditor discovers that a programming error allows customers to create multiple accounts for a single mailing address. Management agrees to correct the program and notify customers with multiple accounts that the accounts will be consolidated. Which of the following actions should the auditor take?
1. Schedule a follow-up review to verify that the program was corrected and the accounts were consolidated.
2. Evaluate the adequacy and effectiveness of the corrective action proposed by management.
3. Amend the scope of the subsequent audit to verify that the program was corrected and that accounts were consolidated.
4. Submit management's plan of action to the external auditors for additional review.
- A. 1 and 4
- B. 3 and 4
- C. 2 and 3
- D. 1 and 2
Answer: D
NEW QUESTION 162
The first step in determining product price is:
- A. Evaluating prices set by the competitors.
- B. Determining the cost of the product.
- C. Developing pricing objectives.
- D. Selecting a pricing method.
Answer: C
NEW QUESTION 163
While performing an accounts payable engagement, a senior auditor wants to conduct several tests of controls for travel expenses. Which of the following actions are most appropriate for the senior auditor to undertake?
1. Ensure all tests use a random sampling technique.
2. Consider a judgmental approach for the sample size.
3. Assess testing errors through root cause analysis.
4. Ensure that the entire data set is tested.
- A. 1 and 2.
- B. 2 and 3.
- C. 1 and 3.
- D. 2 and 4.
Answer: B
NEW QUESTION 164
Which of the following is a key component of an organization's cybersecunty governance?
- A. Management identifying and classifying the types of critical data in the organization's system
- B. Administrators monitoring the use, assignment and configuration of privileges on the network.
- C. Senior management of the organization setting the cybersecurity policy
- D. The IT department establishing^ implementing, and actively managing security configurations.
Answer: C
NEW QUESTION 165
According to the Standards, which of the following is based on the assertion that the quality of an organization's risk management process should improve with time?
- A. Key principles.
- B. Assurance.
- C. Process element.
- D. Maturity model.
Answer: D
NEW QUESTION 166
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?
- A. The auditor should review the programming of the macro before its use to ensure that it is appropriate for the required calculations.
- B. The auditor should tabulate the results in the spreadsheet to ensure the macro has generated the correct results for all calculations.
- C. The auditor should accept the calculations generated by the function, as any further work or documentation would be inefficient.
- D. The auditor should perform a manual recalculation of several results to validate and document the results.
Answer: D
NEW QUESTION 167
Which of the following is a disadvantage of selecting a commercial software package rather than developing an application internally?
- A. Employee resistance to change.
- B. Inadequate technical support.
- C. Lack of flexibility.
- D. Incompatibility with client/server technology.
Answer: C
NEW QUESTION 168
Which of the following recommendations made by the internal audit activity (IAA) is most likely to help prevent fraud?
- A. A vacation policy compliance review found that employees frequently leave on vacation before their leave applications are signed by their manager. The IAA recommends that the manager attend to the leave applications in a more timely fashion.
- B. A review of customer service-level agreements found that orders to several customers are frequently delivered late. The IAA recommends that the organization extend the expected delivery time advertised on its website.
- C. A review of internal service-level agreement compliance in financial services found that requests for information frequently are fulfilled up to two weeks late. The IAA recommends that the financial services unit be eliminated for its ineffectiveness.
- D. A review of password policy compliance found that employees frequently use the same password more than once during a year. The IAA recommends that the access control software reject any password used more than once during a 12-month period.
Answer: D
NEW QUESTION 169
Which of the following best describes an objective for an audit of an environmental management system?
- A. To determine conformance with requirements and agreements.
- B. To assess whether an annual control review is necessary.
- C. To evaluate executive management oversight.
- D. To promote environmental awareness.
Answer: A
NEW QUESTION 170
The audit committee of a global corporation has mandated a change in the organization's business ethics policy. Which of the following approaches describes the best way to accomplish the policy's diffusion worldwide?
- A. Deploy the policy in the corporate headquarters' language, so everyone gets an unfiltered version simultaneously.
- B. Introduce the policy region by region, using any lessons learned to change the subsequent version of the policy for the next area.
- C. Consult with legal and operational management in each affected country to ensure the final version can be implemented globally, following audit committee approval.
- D. Send the board-approved version of the policy to each country's senior leadership, and empower them to tailor the policy to the local language and culture.
Answer: C
NEW QUESTION 171
Which of the following is an example of an application control?
- A. Automated password change requirements
- B. User testing of system changes
- C. Formatted data fields
- D. System data backup process
Answer: C
NEW QUESTION 172
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