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A new chief audit executive wants to develop a formal internal control framework for her organization. She uses globally accepted frameworks as a guide. Which of the following would she likely find critical in creating the new framework for her organization?
Which of the following offers the feast evidence that the internal audit activity has achieved organizational independence?
An engagement supervisor notes that an internal auditor usually documents and submits draft audit reports for review without giving the process owners the opportunity to state their position on the issues raised. How should the engagement supervisor respond?
Which of the following situations is most likely to threaten the independence of the internal audit activity?
Which of the following actions by an organization's board would potentially impair the internal audit activity's independence?
Which of the following actions does a competency assessment tool help the chief audit executive perform?
Which of the following is the internal audit activity expected to do with respect to the organization's governance processes?
Which of the following best demonstrates conformance with the Standards relating to continuing professional development of internal auditors?
Which of the following statements is true regarding risk management frameworks?
How can an Internal audit activity contribute to Its organization's risk assessment process?

Question 664 - IIA-CIA-Part1 discussion

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Which of the following situations is most likely to prompt the internal audit activity to disclose its nonconformance with the Standards?

A.

One of the organization's senior internal auditors owns a side business, though to date, no sales have been made to this business.

Answers
A.

One of the organization's senior internal auditors owns a side business, though to date, no sales have been made to this business.

B.

The annual internal audit plan includes performance audits of main business processes, but reviews of high-risk development projects were not considered.

Answers
B.

The annual internal audit plan includes performance audits of main business processes, but reviews of high-risk development projects were not considered.

C.

The internal audit activity committed to carrying out an audit of documentation on investment hedging, and a hedging expert was contracted to assist with the engagement.

Answers
C.

The internal audit activity committed to carrying out an audit of documentation on investment hedging, and a hedging expert was contracted to assist with the engagement.

D.

A periodic quality self-assessment of the internal audit activity identified a number of improvement areas with regard to key performance indicators.

Answers
D.

A periodic quality self-assessment of the internal audit activity identified a number of improvement areas with regard to key performance indicators.

Suggested answer: B

Explanation:

The internal audit activity must align its activities with the organization's risks. Not considering high-risk development projects in the audit plan could indicate nonconformance with the Standards, specifically regarding risk-based planning. The Standards require internal audit to consider all significant risks when developing the audit plan, and failing to do so may require disclosure of nonconformance.

Reference: The IIA's International Standards for the Professional Practice of Internal Auditing (Standards), specifically Standard 2010 - Planning, and Standard 1300 - Quality Assurance and Improvement Program.

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asked 03/11/2024
Nenad Celikovic
38 questions
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