IIA IIA-CIA-Part2 Quiz 184 Topic 7 Questions 916-920

Question: 1

During a review of purchasing operations, an internal auditor finds that current procedures differ markedly from stated organizational procedures. However, the internal auditor concludes that the procedures currently used represent an increase in efficiency and a decrease in processing time, without a discernible decrease in control. The internal auditor should

AReport the lack of adherence to documented procedures as an operational risk exposure.

BDevelop a flowchart of the new procedures and include it in the report to management.

CReport the change and suggest that the change in procedures be documented.

DSuspend the completion of the engagement until the client documents the new procedures.

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Question: 2

Nhich of the following situations is most likely to be the subject of a written interim report to the engagement client?

ASeventy percent of the planned audit work has been completed with no significant adverse observations.

BThe auditors have decided to substitute survey procedures for some of the planned detailed review of certain records.

CThe engagement program has been expanded because of indications of possible fraud.

DOpen burning at a subsidiary plant poses a prospective violation of pollution regulations.

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Question: 3

During the exit conference, the manager of the engagement client objected to a valid observation about a major control deficiency because the manager felt the observation was based upon a "biased sample and immaterial risk." What step should the internal auditor take?

ALet some neutral group coordinate the follow-up effort after the final engagement communication is issued.

BInclude the engagement client's comments in the report but recommend corrective action.

CReview the condition during the next annual engagement to determine whether the deficiency is major or minor.

DResearch a compromise by modifying the wording of the conclusion.

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Question: 4

The internal auditor should most likely conclude that these facts indicate a(n)

ABreakdown in an operating system that the internal auditor should direct management to correct immediately.

BImportant problem that discussion with operating management should easily resolve.

CIndication that the materials standards used in production planning should be scheduled for review.

DImportant problem that should be included in an engagement communication.

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Question: 5

If the internal auditor decided that the situation warranted management's immediate attention and the entire engagement would not be completed for several weeks, communication with management will probably take the form of a(n)

IIA IIA-CIA-Part2 Quiz:184 Topic:7 Questions:916-920