Question 1

According to IIA guidance, which of the following is true when the internal audit activity is asked to investigate potential ethics violations in a foreign subsidiary?

Options :

A :

Communication of any internal ethics violations to external parties may occur with appropriate safeguards.

B : Cultural impacts are less critical where the organization practices uniform polices around the globe.

C : Cross-cultural differences should always be handled by the staff of the same cultural background.

D : Local law enforcement should be involved as they are more familiar with the applicable local laws.

Answer: A

Question 2

New environmental regulations require the board to certify that the organization's reported pollutant emissions data is accurate. The chief audit executive (CAE) is planning an audit to provide assurance over the organization's compliance with the environmental regulations. Which of the following groups or individuals is most important for the CAE to consult to determine the scope of the audit?

Options :

A : The audit committee of the board.

B : The environmental, health, and safety manager.

C : The organization-s external environmental lawyers.

D : The organization-s insurance department.

Answer: B

Question 3

An internal auditor used a risk and control matrix to prepare a work program for testing a software release.

During the engagement planning stage, he tested the design of

the release procedure as a key control and concluded that the control was not designed well. During the

performance stage, he tested the operation of this control and

concluded that it was implemented as designed. Which of the following statements is true regarding this

scenario?

Options :

A : The test of the control design should have occurred at the performance stage.

B : The test of the operating effectiveness of the control was not necessary.

C : A risk and control matrix is not appropriate for this type of engagement.

D : The test of the operating effectiveness of the control should have occurred at the planning stage.

Answer: B

Question 4

Which of the following best illustrates the primary focus of a risk-based approach to control self-assessment?

Options :

A : To evaluate controls regarding the computer security of an oil refinery.

B : To examine the processes involved in exploring, developing, and operating a gold mine.

C : To assess the likelihood and impact of events associated with operating a finished goods warehouse.

D : To link a financial institution-s business objectives to a work unit responsible for the associated risk.

Answer: D

Question 5

An internal auditor is conducting an initial risk assessment of an audit area and wants to assess management's compliance with privacy laws for safeguarding customer information stored on the organization's servers. Which course of action is appropriate for this phase of the engagement?

Options :

A : Solicit the services of a specialist information systems auditor

B : Obtain the most current approved copies of the organization-s privacy policy

C : Consult with legal counsel about new privacy laws to establish appropriate criteria

D : Consider the detection risk of noncompliance with the laws

Answer: B

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