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Question 298 - IIA-CIA-Part2 discussion

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A chief audit executive (CAE) following up on action plans from previously completed audits identifies that management has determined that certain action plans are no longer necessary If the CAE disagrees with management's decision, which of the following is the most appropriate next step for the CAE to take?

A.
The CAE must discuss the matter with senior management
Answers
A.
The CAE must discuss the matter with senior management
B.
The CAE must discuss the matter with key shareholders
Answers
B.
The CAE must discuss the matter with key shareholders
C.
The CAE must discuss the matter with legal counsel
Answers
C.
The CAE must discuss the matter with legal counsel
D.
The CAE must discuss the matter with the board
Answers
D.
The CAE must discuss the matter with the board
Suggested answer: D

Explanation:

If the Chief Audit Executive (CAE) disagrees with management's decision to deem certain action plans no longer necessary, the CAE must discuss the matter with the board. The board has the ultimate responsibility for oversight of the internal audit function and for ensuring that management addresses audit recommendations appropriately. Escalating the issue to the board ensures that the CAE fulfills their duty to report significant issues and disagreements to those charged with governance.

The Institute of Internal Auditors (IIA) Standard 2600 -- Communicating the Acceptance of Risks: 'When the chief audit executive believes that senior management has accepted a level of residual risk that may be unacceptable to the organization, the chief audit executive must discuss the matter with senior management. If the decision regarding residual risk is not resolved, the chief audit executive must report the matter to the board for resolution.'

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asked 18/09/2024
Akram Abou Soultan
32 questions
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