IIA-CIA-Part1 Exam Practice Test Instant Access

Question 1

The internal audit activity is responsible for conducting fraud investigations. A potential fraud instance was identified during an audit engagement. The chief audit executive appoints a lead investigator. Which of the following would most likely be the next step?

AAsk internal auditors to gather all relevant information and evidence.

BIdentify and interview witnesses first and potential suspects later.

CConduct a fraud risk assessment to identify the most vulnerable areas.

DDetermine the competencies needed and assess whether team members have a conflict of Interest.

Answer : D

Question 2

Which of the following actions should the audit committee take to promote organizational independence for the internal audit activity?

ADelegate final approval of the risk-based internal audit plan to the chief audit executive (CAE).

BApprove the annual budget and resource plan for the internal audit activity.

CAssist the CAE with hiring objective and competent internal audit staff.

DEncourage the CAE to communicate and coordinate with the external auditor.

Answer : B

Question 3

According to IIA guidance, which of the following statements regarding the internal audit charter is true?

AThe nature of consulting services typically is not included in the charter.

BThe chief audit executive must formally review the charter at least once a year

CThe nature of assurances provided to parties outside of the organization typically is not included in the charter.

DThe charter typically defines the internal audit activity's position within the organization.

Answer : D

Question 4

When beginning an engagement to assess the effectiveness of the organization's newly revamped risk management processes, which of the following should internal auditors review first?

AKey risk disclosures in the annual report.

BExisting risk assessment and identification processes.

COrganizational strategy and business plans.

DRisk mitigation plans and risk responses.

Answer : C

Question 5

Senior management has requested that the internal audit activity review and amend policies where necessary when auditing the purchasing department. To which of the following would the chief audit executive most likely give primary consideration when responding to this request?

AAuditor competency.

BInternal audit independence.

CAuditor objectivity.

DEngagement scope.

Answer : B

Question 6

An organization's operations management is aware of existing internal control deficiencies but they lack the competency to execute internal control measures. Which of the following actions if taken by the internal audit activity is appropriate to assist operating management in achieving continuous improvement on internal controls?

AFoster the importance of the control environment

BProvide training on controls and on self-monitoring processes

CRecommend installing an enterprisewide risk management system.

DConduct more assurance assignments on high risk areas

Answer : B

Question 7

A large commercial bank was fined by regulators for fraudulent practices when employees, over a period of time, opened thousands of new accounts for existing clients without the clients' consent. It was later found that employees were given unrealistic new account targets and were aggressively monitored by management on a daily basis.

Which of the following controls would have most likely reduced the likelihood of the fraudulent practice from occurring?

AAn evaluation of the current performance and compensation program.

BThe performance of background investigations on all existing employees.

CThe availability of fraud training to all employees.

DThe availability of an employee whistleblower hotline

Answer : A

IIA Certified Internal Auditor IIA-CIA-Part1 Exam Practice Test