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Question 321 - IIA-CIA-Part2 discussion

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According to IIA guidance which of the following statements is true regarding the annual audit plan?

A.
The annual audit plan should only be adjusted in response to problems with resourcing, scope, and data availability.
Answers
A.
The annual audit plan should only be adjusted in response to problems with resourcing, scope, and data availability.
B.
The chief audit executive (CAE) may incorporate risk information, including risk appetite levels from management for the audit plan at her discretion.
Answers
B.
The chief audit executive (CAE) may incorporate risk information, including risk appetite levels from management for the audit plan at her discretion.
C.
In an immature risk management environment it is preferable for the CAE to rely solely on her judgment regarding risk identification and assessment to develop the audit plan.
Answers
C.
In an immature risk management environment it is preferable for the CAE to rely solely on her judgment regarding risk identification and assessment to develop the audit plan.
D.
The CAE may make adjustments to the annual audit plan as needed without senior management or board approval.
Answers
D.
The CAE may make adjustments to the annual audit plan as needed without senior management or board approval.
Suggested answer: B

Explanation:

According to the Institute of Internal Auditors (IIA) guidance, the chief audit executive (CAE) should develop a risk-based audit plan that takes into account the organization's risk management framework, including its risk appetite levels. This aligns with Standard 2010 -- Planning, which states that the CAE must establish a risk-based plan to determine the priorities of the internal audit activity, consistent with the organization's goals. Risk appetite levels from management are a critical component of understanding the organization's risk profile and should be incorporated into the audit plan. Thus, the CAE may incorporate risk information, including risk appetite levels from management, at her discretion.

Reference: IIA's International Standards for the Professional Practice of Internal Auditing, Standard 2010 -- Planning.

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asked 18/09/2024
Sam Patel
34 questions
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