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How should an internal auditor approach preparing a detailed risk assessment during engagement planning?
A newly promoted chief audit executive (CAE) is faced with a backlog of assurance engagement reports to review for approval. In an attempt to attach a priority for this review, the CAE scans the opinion statement on each report. According to IIA guidance, which of the following opinions would receive the lowest review priority? 1. Graded positive opinion. 2. Negative assurance opinion. 3. Limited assurance opinion. 4. Third-party opinion.
According to an internal audit observation, the organization's rules of record management require all contracts to be registered and stored in a specific electronic system. One subsidiary has thousands of client contracts on paper, which are kept in the office because there are not enough assistants to scan the contracts into the system. Which of the following component should be added to this observation?
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Internal audit staff lacks the expertise to perform a fraud investigation engagement stemming from a whistleblowing incident. Which of the following is the most appropriate option for the chief audit executive?
According to the MA guidance, which of the following does the engagement work program test in a review of an organizational process?
An internal auditor wanted to determine whether company vehicles were being used for personal purposes She extracted a report that listed company vehicle numbers business units to which the vehicles are allocated travel dates, travel duration and mileage She then filtered the data for weekend dates Which of the following additional information would the auditor need?
During follow-up. the internal auditor discovered that operational management did not implement effective actions to address a significant control breach If the issue is left unresolved it may result in regulatory sanctions and damage the organization's reputation What is the most appropriate next step for the chief audit executive to lake?
A code of business conduct should include which of the following to increase its deterrent effect? 1. Appropriate descriptions of penalties for misconduct. 2. A notification that code of conduct violations may lead to criminal prosecution. 3. A description of violations that injure the interests of the employer. 4. A list of employees covered by the code of conduct.

Question 265 - IIA-CIA-Part2 discussion

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An internal auditor is planning an engagement at a financial institution. Toe engagement objective is to identify whether loans were granted in accordance with the organization's policies. When of the following approaches would provide the auditor with the best information?

A.
Randomly select 30 cases of loans and verify whether they were repaid timely and in full
Answers
A.
Randomly select 30 cases of loans and verify whether they were repaid timely and in full
B.
Randomly select 30 cases of loans and validate them against applicable underwriting guidelines
Answers
B.
Randomly select 30 cases of loans and validate them against applicable underwriting guidelines
C.
Randomly select 30 employees to complete a survey regarding whether policies and standards are followed
Answers
C.
Randomly select 30 employees to complete a survey regarding whether policies and standards are followed
D.
Randomly select several months obtain ageing reports for these months and compare them with the poor year
Answers
D.
Randomly select several months obtain ageing reports for these months and compare them with the poor year
Suggested answer: B

Explanation:

To determine if loans were granted in accordance with the organization's policies, the most effective approach is to validate a sample of loans against the applicable underwriting guidelines. This method allows the auditor to directly assess compliance with the specific criteria set out in the organization's loan granting policies, providing clear evidence on whether the loans meet the required standards.

The Institute of Internal Auditors (IIA) Practice Guide: Auditing Credit Risk Management

IIA Standard 2210 - Engagement Objectives

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asked 18/09/2024
Nardos Tadele
30 questions
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