Question 1

According to IIA guidance, which of the following statements best justifies a chief audit executive's request for external consultants to complement internal audit activity (IAA) resources?

Options :

A : The organization-s audit universe is extensive and diverse.

B : There has been an increase in unanticipated requests for advisory work.

C : Previous work provided by the external service provider has been of great quality and value.

D : A recent benchmarking study found that using external service providers is a common practice of similarly-sized IAAs in other organizations.

Answer: B

Question 2

Which type of bond sells at a discount from face value, then increases in value annually until it reaches maturity and provides the owner with the total payoff?

Options :

A : High-yield bonds.

B : Commodity-backed bonds.

C : Zero coupon bonds.

D : Junk bonds.

Answer: C

Question 3

Which of the following situations would justify the removal of a finding from the final audit report?

Options :

A : Management disagrees with the report findings and conclusions in their responses.

B : Management has already satisfactorily completed the recommended corrective action.

C : Management has provided additional information that contradicts the findings.

D : Management believes that the finding is insignificant and unfairly included in the report.

Answer: C

Question 4

Which of the following statements are true regarding the use of heat maps as risk assessment tools?1. They focus primarily on known risks, limiting the ability to identify new risks.2. They rely heavily on objective assessments and related risk tolerances.3. They are too complex to provide an easily understandable view of key risks.4. They are helpful but limited in value in a rapidly changing environment.

Options :

A : 1 and 2 only

B : 1 and 4 only

C : 2 and 3 only

D : 3 and 4 only

Answer: B

Question 5

Which of the following combinations of conditions is most likely a red flag for fraud?

Options :

A : The practice of surprise audits and the implementation of an employee support program.

B : Hiring an employee with a prior fraud conviction and yearly management review.

C : Occasional accounting department overrides and discontinuation of the anonymous fraud hotline due to infrequent use.

D : A veteran employee in upper management experiencing financial difficulties and recently implemented enhanced controls.

Answer: C

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