IIA IIA-CIA-Part2 Quiz 149 Topic 7 Questions 741-745

Question: 1

Which of the following documents provides the most persuasive information concerning the existence and valuation of a receivable?

AA credit approval document supported by the customer's audited financial statements.

BA copy of a sales invoice to the customer in the engagement client's records.

CA positive confirmation received directly from the customer.

DA customer's purchase order in the engagement client's records related to the credit sale.

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Question: 2

A bank internal auditor wanted to verify the accuracy of the general ledger balance of a depository account. One engagement procedure used in this process was to mail positive confirmations to statistically sampled depositors. However, the number of replies received was not adequate to form a valid conclusion about the account's accuracy. What action should the internal auditor take to accomplish this objective?

AAssume that the no replies represent tacit agreements by the depositor, document the results, and perform no further work on this engagement procedure.

BExpand the original confirmation sample to include additional depositors.

CVerify accuracy of the depositors' addresses. Retail confirmation requests a second time with a notation indicating that it is a second request.

DMail negative confirmation requests to all non-replies and document results of testing. If necessary, telephone depositors to inquire about any disagreement with balances confirmed.

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Question: 3

Which of the following statements describes an internal control questionnaire?

AIt provides detailed information regarding the substance of the control system.

BIt takes less of the engagement client's time to complete than other control evaluation devices.

CIt requires that the internal auditor be in attendance to properly administer it.

DIt provides indirect information that might need corroboration.

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Question: 4

During interviews with the inventory management personnel, an internal auditor learned that salespersons often order inventory for stock without receiving the approval of the vice president of sales. Also, detail testing showed that there are no written approvals on purchase orders for replacement parts. The results of detail testing are a good example of

AIndirect information.

BCircumstantial information.

CCorroborative information.

DSubjective information.

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Question: 5

Which of the following engagement objectives will be accomplished by tracing a sample of accounts receivable debit entries to customer invoices and related shipping documents?

ASales are properly recorded.

BSales are billed at the correct prices.

CAccounts receivable represent valid sales.

DCustomer credit is approved.

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IIA IIA-CIA-Part2 Quiz:149 Topic:7 Questions:741-745