Recommendations should be included in the audit report in order to:

A.

Provide management with options for addressing audit findings.

B.

Ensure that audit findings are resolved in the manner suggested by the auditor.

C.

Minimize the amount of time required to correct audit findings.

D.

Ensure that audit findings are addressed by management

Which of the following is not relevant when developing recommendations for inclusion in audit
reports?

A.

Feasibility.

B.

Cost of implementation.

C.

Underlying causes.

D.

 Timing of follow-up.

As a result of a recent discovery of false information on employment applications, an internal
auditor has reviewed hiring procedures. Which of the following represents a weakness in the
control system?
I. Applicants are not required to have their signed applications legally authenticated.
II. Applicants' educational information is not validated with the educational institution before
employment is offered.
III. Information related to applicants' long-term work history is not validated before employment is
offered.

A.

III only

B.

I and II only

C.

II and III only

D.

I, II, and III

Which of the following must an auditor establish in order to demonstrate that fraud has occurred?

A.

Monetary damage to the victim.

B.

The suspect's intent.

C.

Existence of an internal control deficiency.

D.

Evidence of collusion.

Which of the following would be the least important reason for a company to merge with another
company?

A.

To diversify risk.

B.

As a response to new government policy.

C.

To reduce labor costs.

D.

To increase stock prices.

Which of the following potential performance measures should an auditor recommend excluding
from a performance scorecard?

A.

Number of employees.

B.

Market share.

C.

 Number of customer complaints.

D.

 Training dollars per employee

Which of the following is the best approach for obtaining feedback from engagement clients
regarding the quality of internal audit work?

A.

Ask questions during the exit interviews and send copies of the documented responses to the
clients.

B.

Call engagement clients after the exit interviews and send copies of the documented responses
to the clients.

C.

Distribute questionnaires to selected engagement clients shortly before preparing the internal
audit annual activity report.

D.

Provide questionnaires to engagement clients at the beginning of each engagement and
request that the clients complete and return them after the engagements

After completing a fraud investigation but before publishing a formal written report, the chief audit
executive should submit a draft of the final report to the organization's:

A.

Legal counsel.

B.

External auditor.

C.

Audit committee chairperson.

D.

Chief executive officer.

Senior management of an organization has requested that the internal audit activity provide
ongoing internal control training for all managerial personnel. This is best addressed by:

A.

A formal consulting engagement.

B.

An informal consulting engagement.

C.

A performance assurance engagement.

D.

An operational assurance engagement.

A key to effective benchmarking in a consulting engagement is identifying the issues that can be:|

A.

Reviewed by all internal audit staff members.

B.

Shared with all internal audit customers.

C.

Measured and controlled by the engagement client.

D.

Discussed with the board or audit committee