Question 1

During an accounts payable audit engagement, the internal auditor identified a risk that vendor invoices may be paid multiple times. Which of the following would be appropriate preventive controls to mitigate this risk?

Options :

A : System controls to identify identical invoice amounts from the same vendor that prohibit payment after the initial invoice.

B : System controls to identify identical invoice numbers and dates from the same vendor prior to payment.

C : Manual controls requiring the reconciliation of paid vendor invoices to monthly invoice statements provided by the vendor.

Answer: B

Question 2

Which of the following lists the audit activities in the order in which they would generally be completed during a preliminary survey?I. Write detailed audit procedures.II. Identify client objectives, goals, and standards.III. Identify risks and controls intended to prevent associated losses.IV. Determine relevant engagement objectives.

Options :

A : II, IV, I, III.

B : II, I, IV, III.

C : II, III, IV, I.

D : III, IV, II, I.

Answer: C

Question 3

Which of the following is not a type of control?

Options :

A : Detective.

B : Reactive.

C : Preventive.

D : Directive.

Answer: B

Question 4

Which of the following is a purpose of an embedded audit module?

Options :

A : It enables continuous monitoring of transaction processing.

B : It identifies program code that may have been inserted for unauthorized purposes.

C : It verifies the correctness of account balances on a master file.

Answer: A

Question 5

The following information has been derived from a company’s financial statements: Current assets $640,000 Total assets 990,000 Long-term liabilities 130,000 Current ratio 3.2 The company’s debt to equity ratio is

Options :

A : 0.13

B : 0.33

C : 0.37

D : 0.50

Answer: D

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