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Question 712 - IIA-CIA-Part1 discussion

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The audit committee chair requested that the chief audit executive include in his annual report to the audit committee information related to how the internal audit activity meets its requirement for due professional care. Which of the following statements would be appropriate to include in the report?

A.

During engagements, the identified risks were appropriately addressed with necessary audit procedures to ensure that any risk that threatened the company's objectives was adequately mitigated, regardless of cost.

Answers
A.

During engagements, the identified risks were appropriately addressed with necessary audit procedures to ensure that any risk that threatened the company's objectives was adequately mitigated, regardless of cost.

B.

Due professional care was exercised during the conduct of each engagement so that all risks were identified and ranked, and assurance procedures were designed to address each risk accordingly.

Answers
B.

Due professional care was exercised during the conduct of each engagement so that all risks were identified and ranked, and assurance procedures were designed to address each risk accordingly.

C.

To meet its mission of enhancing and protecting organizational value and to demonstrate appropriate support for management, the internal audit activity planned to accept all proposed management consulting engagements.

Answers
C.

To meet its mission of enhancing and protecting organizational value and to demonstrate appropriate support for management, the internal audit activity planned to accept all proposed management consulting engagements.

D.

During engagements, internal auditors considered various data analysis techniques and relevant technology-based audit procedures, and used these techniques and procedures when applicable.

Answers
D.

During engagements, internal auditors considered various data analysis techniques and relevant technology-based audit procedures, and used these techniques and procedures when applicable.

Suggested answer: B

Explanation:

Due professional care is the care and skill expected of a reasonably prudent and competent internal auditor2.It requires internal auditors to follow the International Professional Practices Framework (IPPF) issued by the Institute of Internal Auditors (IIA), which includes the Code of Ethics and the Standards3.One of the aspects of due professional care is to perform risk-based audits, which means identifying and assessing the risks that may affect the organization's objectives, and designing and executing audit procedures that provide reasonable assurance on the effectiveness of risk management and internal control4. Therefore, option B is an appropriate statement to include in the report to demonstrate how the internal audit activity meets its requirement for due professional care.

1: Standard 1220 -- Due Professional Care2: Due professional care definition3: What is due professional care in internal audit?4: Standard 1220 -- Due Professional Care - The Institute of Internal Auditors or The IIA

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asked 03/11/2024
Mohamed Ismail
49 questions
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