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Question 244 - IIA-CIA-Part2 discussion

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According to IIA guidance, which of the following is the most appropriate action to be taken by the chief executive (CAE) if management refuses to accept audit recommendations and implement corrective actions, Even after escalation to senior management?

A.
The CAE should continue to meet with management to obtain their agreement for corrective action
Answers
A.
The CAE should continue to meet with management to obtain their agreement for corrective action
B.
The CAE should note in the final report that management has decided to accept the risk.
Answers
B.
The CAE should note in the final report that management has decided to accept the risk.
C.
The CAE should ask that additional testing be undertaken to strengthen his case as to the need for corrective action.
Answers
C.
The CAE should ask that additional testing be undertaken to strengthen his case as to the need for corrective action.
D.
The CAE should advise senior management of his intention to escalate the matter to the board.
Answers
D.
The CAE should advise senior management of his intention to escalate the matter to the board.
Suggested answer: D

Explanation:

According to IIA guidance, if management refuses to accept audit recommendations and implement corrective actions, the chief audit executive (CAE) has a responsibility to ensure that the audit committee or the board is aware of the unresolved risks. The CAE should escalate the matter to senior management first. If senior management still does not take action, the CAE should then inform the board. This escalation process ensures that the board is fully informed about significant risks that management has decided to accept and can take appropriate action if necessary.

Reference:

The Institute of Internal Auditors (IIA) - Standards for the Professional Practice of Internal Auditing, Standard 2600 - Communicating the Acceptance of Risks

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asked 18/09/2024
Chaston Williams
33 questions
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