Mar-2024 IIA IIA-CRMA-ADV Actual Questions and Braindumps
IIA-CRMA-ADV Dumps To Pass IIA Exam in 24 Hours - PracticeTorrent
NEW QUESTION # 71
Which of the following statements accurately describes the responsibility of the internal audit activity regarding IT governance?
1. The internal audit activity does not have any responsibility because IT governance is the responsibility of the board and senior management of the organization.
2. The internal audit activity must assess whether the IT governance of the organization supports the organization's strategies and objectives.
3. The internal audit activity may assess whether the IT governance of the organization supports the organization's strategies and objectives.
4. The internal audit activity may accept requests from management to perform advisory services regarding how the IT governance of the organization supports the organization's strategies and objectives.
- A. 3 and 4.
- B. 2 and 4.
- C. 4 only.
- D. 1 only.
Answer: D
NEW QUESTION # 72
Which of the following factors have the greatest influence on the independence of the internal audit activity?
- A. Quality assessments and cultural biases of the internal audit activity.
- B. Employee incentives and self review of the internal audit activity.
- C. Rotational assignments and familiarity of the internal audit activity.
- D. Organizational positioning and scope control of the internal audit activity.
Answer: D
NEW QUESTION # 73
Which of the following is true regarding the use of a formal risk management framework?
1. It facilitates a methodical approach to risk mitigation.
2. It defines and standardizes the terminology used in risk communication.
3. It establishes the risk tolerance levels to be accommodated in the strategy.
4. It facilitates the alignment of risk mitigation strategies with management priorities.
- A. 2. 3, and 4.
- B. 1.2, and 3.
- C. 1.3, and 4.
- D. 1,2, and 4.
Answer: D
NEW QUESTION # 74
Which of the following scenarios best illustrates a rationalization as the root cause of potential fraud?
- A. The organization is slowly phasing out three mature products that produce the highest commissions for the sales staff.
- B. Managers who have been with the organization for several decades become aware that newly hired, younger managers are being moved more quickly into senior positions.
- C. Security cameras that monitor cash handling at the register are not functioning.
- D. The controller at a nationwide manufacturing company recently opted to no longer require two-week mandatory vacations for accounting staff.
Answer: D
NEW QUESTION # 75
An internal audit activity (IAA) provided assurance services for an activity it was responsible for during the preceding year.
As a result, which IIA Code of Ethics principle is presumed to be impaired?
- A. Flexibility.
- B. Independence.
- C. Competence.
- D. Objectivity.
Answer: D
NEW QUESTION # 76
Which of the following must be in existence as a precondition to developing an effective system of internal controls?
- A. A risk assessment process.
- B. A strategic objective-setting process.
- C. An information and communication process.
- D. A monitoring process.
Answer: A
NEW QUESTION # 77
Which of the following is a valid statement about the use of visual observations during an audit engagement?
1. Visual observations can be used to detect ineffective controls, idle resources, and safety hazards.
2. Visual observations can be used during both preliminary survey and fieldwork stages of the audit engagement.
3. Visual observations can provide unsubstantiated facts to management if the internal auditor believes the information is useful.
4. Visual observations can assist an auditor in determining if a material observation should be communicated through informal means to the organization's senior management.
- A. 3 and 4 only
- B. 1 and 4 only
- C. 1 and 2 only
- D. 2 and 3 only
Answer: C
NEW QUESTION # 78
Click the Exhibit.
Internal auditors are asked to keep track of how many hours per day they spend planning the audit, conducting the engagement, and writing the audit report. The data for two days has been collected as follows:
Day 1
Day 2
Planning the audit
2 hours
3 hours
Conducting the engagement
1 hour
1 hour
Writing the audit report
2 hours
4 hours
Which of the following graphs depicts the data accurately?
- A. Neither A nor B.
- B. Both A and B.
- C. Graph A only
- D. Graph B only
Answer: B
NEW QUESTION # 79
As a matter of policy, the chief audit executive routinely rotates internal audit staff assignments and periodically interviews the staff to discuss the potential for conflicts of interest. These actions help fulfill which of the following internal audit mandates?
- A. Organizational independence.
- B. Individual proficiency.
- C. Professional objectivity.
- D. Due professional care.
Answer: C
NEW QUESTION # 80
A chief audit executive (CAE) is selecting an internal audit team to perform an audit engagement that requires a high level of knowledge in the areas of finance, investment portfolio management, and taxation. If neither the CAE nor the existing internal audit staff possess the required knowledge, which of the following actions should the CAE take?
- A. Hire consultants who possess the required knowledge to perform the engagement.
- B. Ask the audit committee to decide the course of action.
- C. Select the most experienced auditors in the department to perform the engagement.
- D. Postpone the audit until the CAE hires internal audit staff with the required knowledge.
Answer: A
NEW QUESTION # 81
According to The MA Global Internal Audit Competency Framework, which of the following areas of training would best assist the internal audit activity in improving its use of tools and techniques?
- A. Negotiation and conflict resolution.
- B. Ethics and fraud.
- C. Project management.
- D. Financial accounting.
Answer: C
NEW QUESTION # 82
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?
- A. Ask management to determine which internal audit engagements are lower risk and could be considered for removal from the annual audit plan.
- B. Ask The human resources department to determine how the annual compensation and salary of the audit staff could be adjusted to achieve savings.
- C. Ask the chief audit executive to determine whether budgetary limitations impede the ability of the internal audit activity to execute its responsibilities.
- D. Ask appropriate stakeholders for their opinion on the potential impacts of reducing the scope of the internal audit plan.
Answer: C
NEW QUESTION # 83
According to The IIA's Code of Ethics, which of the following actions violates the principle of confidentiality?
- A. Providing personal tax preparation services for a fee for several employees during the lunch hour.
- B. Accepting a consulting request in the IT department without possessing the requisite experience.
- C. Agreeing to reword an observation to avoid the client complaining directly to the auditor's supervisor.
- D. Providing a friend with the marketing strategic plan, which she will use to prepare her university thesis.
Answer: D
NEW QUESTION # 84
An internal auditor wants to sample data to test an audit theory in a cost-effective way. Which of the following sampling strategies should she use?
- A. Neither approach to testing the audit theory would be cost effective.
- B. Statistical sampling only
- C. Nonstatistical sampling only
- D. A combination of both statistical and nonstatistical sampling.
Answer: C
NEW QUESTION # 85
Management of a publicly-held organization requires the internal audit activity to be involved with quarterly financial statements, which are made public and used internally. Which of the following explanations of management's decision is least plausible?
- A. Management may be concerned about potential penalties that could occur if quarterly financial statements are misstated.
- B. Management may be concerned about its reputation in the financial markets.
- C. Management may perceive that having quarterly financial information examined by the internal auditors enhances the information's value to internal decision making.
- D. Management is following best-practice protocol, as stipulated by the Standards, which states that internal auditors must review quarterly financial statements.
Answer: D
NEW QUESTION # 86
The results of an internal audit activity's (IAA) quality assurance and improvement program are favorable and an external assessment was completed within the last five years. Which of the following statements may the IAA use to describe its work?
- A. "Conforms with the International Standards for the Professional Practice of Internal Auditing."
- B. "Compliant with all domestic and international legal statutes, and certified quality assured for ten years."
- C. "Completed with the advance certification of the External Assessors Association for Auditing Review."
- D. "Certified 100% accuracy, per the International Standards of External Assessment."
Answer: A
NEW QUESTION # 87
According to the Standards, which of the following is not a consideration when exercising due professional care for an assurance engagement?
- A. The relative complexity, materiality, or significance of matters to which assurance procedures are applied.
- B. The cost of providing the assurance services in relation to potential benefits.
- C. The extent of assurance services necessary to ensure that all risks are identified.
- D. The probability of significant errors, irregularities or instances of noncompliance.
Answer: C
NEW QUESTION # 88
According to The MA Code of Ethics, which of the following is one of the rules of conduct for objectivity?
- A. Internal auditors shall respect and contribute to legitimate and ethical objectives of the organization.
- B. Internal auditors shall continually improve their proficiency and effectiveness and quality of their services.
- C. Internal auditors shall not accept anything that may impair or be presumed to impair their professional judgment.
- D. Internal auditors shall be prudent in the use and protection of information acquired in the course of their duties.
Answer: C
NEW QUESTION # 89
An internal audit manager of a furniture manufacturing organization is planning an audit of the procurement process for kiln-dried wood. The procurement department maintains six procurement officers to manage 24 different suppliers used by the organization.
Which of the following controls would best mitigate the risk of employees receiving kickbacks from suppliers?
- A. A pre-award financial capacity analysis of suppliers.
- B. An automated computer report, organized by supplier, of any invoices for the same amount.
- C. Periodic inventories of kiln-dried wood at the organization's warehouse.
- D. The periodic rotation of procurement officers' assignments to supplier accounts.
Answer: D
NEW QUESTION # 90
An internal auditor for a large retail chain suspects that a store manager has been stealing money from cash sales by listing the sales as accounts receivable and then writing off the accounts as bad debts. Which of the following irregularities is the most likely cause of the auditor's suspicion?
- A. A much higher bad debt expense as a percentage of sales than that of other stores.
- B. A much higher bad debt expense as a percentage of sales than that of previous years.
- C. A much higher percentage of past-due accounts receivable than that of other stores.
- D. A much higher percentage of past-due accounts receivable than that of previous years.
Answer: A
NEW QUESTION # 91
An assurance mapping exercise helps an organization do which of the following?
1. Provide assurance to stakeholders that risks are managed and reported, and regulatory and legal obligations are met.
2. Fulfill best practices in the industry.
3. Identify and address any gaps in the risk management process.
4. Identify fraud.
- A. 2 and 3.
- B. 3 and 4.
- C. 1 and 4.
- D. 1 and 3.
Answer: D
NEW QUESTION # 92
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?
- A. The external auditor may use the work, as the board has approved the charter, thus taking responsibility for any deficiencies.
- B. The external auditor may make full use of the work, as the audit charter is very specific as to the work the internal audit activity may undertake.
- C. The external auditor must disregard the work, as the scope of the charter may introduce bias and result in a lack of due professional care.
- D. The external auditor may use the work with caution, due to the internal audit activity's scope and responsibility restrictions.
Answer: D
NEW QUESTION # 93
Which of the following best explains why integrity is a necessary personal quality for internal auditors at all levels?
- A. Internal auditor integrity enables the internal auditor to avoid being challenged by any party in the organization.
- B. Internal auditor integrity enables users of internal auditors' work to make important business decisions.
- C. Internal auditor integrity enables the internal audit activity to be able to demonstrate independence.
- D. Internal auditor integrity enables stakeholders to constantly question the work of the internal audit activity.
Answer: B
NEW QUESTION # 94
Evidence discovered during the course of an engagement suggests that multiple incidents of fraud have occurred. There do not appear to be sufficient controls in place to prevent reoccurrence. Which of the following is the internal auditor's most appropriate next step?
- A. Provide the evidence that was discovered to local law enforcement for possible prosecution of the suspected fraud.
- B. Discuss the situation with the engagement supervisor to determine whether fraud investigation experts are required to investigate the matter properly.
- C. Fully document in the workpapers the evidence that has been discovered and recommend appropriate controls to address the fraud.
- D. Immediately notify management of the area under review and the other internal auditors involved in the engagement.
Answer: D
NEW QUESTION # 95
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