Full IIA-CIA-Part2 Practice Test and 510 unique questions with explanations waiting just for you!
Certified Internal Dumps IIA-CIA-Part2 Exam for Full Questions - Exam Study Guide
NEW QUESTION 255
What type of analysis is performed when an auditor tests for unusual variations in information by comparing the number of employees working at a factory site with the direct cost of production each month over a period of one year?
- A. Horizontal analysis.
- B. Trend analysis.
- C. Ratio analysis.
- D. Regression analysis.
Answer: D
Explanation:
Section: Volume C
NEW QUESTION 256
The following audit observation was included in the final audit report:
"Our review concluded that bank reconciliation statements for March and April did not show evidence of supervisory review. We recommend strict compliance with the controller's manual, which requires the department head to place their initials on the reconciliation statements to document their review." Which of the following attributes are missing from the above audit observation?
1. Criteria.
2. Condition.
3. Cause.
4. Effect.
- A. 1, 3, and 4 only
- B. 2 and 3 only
- C. 3 and 4 only
- D. 1 and 4 only
Answer: C
Explanation:
Section: Volume D
NEW QUESTION 257
What is the primary factor that determines the depth and breadth of audit follow-up?
- A. The auditor's assessment of personnel responsible for correcting audit findings.
- B. The auditor's assessment of risk associated with the audit findings.
- C. The engagement client's written response to the audit findings.
- D. The availability of audit personnel and financial resources.
Answer: B
NEW QUESTION 258
The use of standard operating procedure questionnaires in audit fieldwork can be beneficial because.
- A. These questionnaires can both identify discrepancies and educate clients.
- B. These questionnaires do not normally require prior clearance with management of the audited area.
- C. These questionnaires are more comprehensive than are other types of techniques for gathering data during fieldwork.
- D. Standard operating procedures are essential to the effectiveness and efficiency of operations.
Answer: A
Explanation:
Section: Volume B
NEW QUESTION 259
Which of the following does not represent a difficulty in using red flags as fraud indicators?
- A. Some red flags are difficult to quantify or to evaluate.
- B. Many common red flags are also associated with situations where no fraud exists.
- C. The red flags literature is not well enough established to have a positive impact on auditing.
- D. Red flag information is only gathered in extraordinary circumstances.
Answer: C
NEW QUESTION 260
A manager of one of a retailer's several retail outlets is stealing cash from cash sales, recording the sales as accounts receivable, and subsequently writing off the fictitious accounts receivable as bad debts. Which of the following comparisons would be most effective in signaling the possibility of such a fraud?
- A. Bad debt expense as a percentage of sales, compared to that of the other outlets.
- B. Percentage of past-due accounts receivable, compared to that of previous years.
- C. Bad debt expense as a percentage of sales, compared to that of previous years.
- D. Percentage of past-due accounts receivable, compared to that of the other outlets.
Answer: A
NEW QUESTION 261
Which of the following factors would the auditor in charge be least likely to consider when assigning tasks to audit team members for an engagement?
- A. The availability of the auditors in relation to the availability of key client staff.
- B. Whether the budgeted hours are sufficient to complete the audit within the current scope.
- C. The amount of experience the auditors have conducting audits in the specific area of the organization.
- D. Whether outside resources will be needed, and their availability.
Answer: B
NEW QUESTION 262
What type of analysis is performed when an auditor tests for unusual variations in information by comparing the number of employees working at a factory site with the direct cost of production each month over a period of one year?
- A. Horizontal analysis.
- B. Trend analysis.
- C. Ratio analysis.
- D. Regression analysis.
Answer: D
NEW QUESTION 263
During an audit of an ethics program, which of the following procedures are most appropriate to evaluate the effectiveness of the program?
- Testing whether corrective actions taken on involved parties breaching the ethics program are adequate. - Testing whether all employees are mandated through policy to comply with the ethics program. - Testing whether all employees are required to confirm in writing their compliance with the ethics program. - Testing through surveys employee's level of understanding and commitment to the ethics program.
- A. 1 and 4 only.
- B. 2 and 3 only.
- C. 1 and 2 only.
- D. 3 and 4 only.
Answer: A
NEW QUESTION 264
According to IIA guidance, which of the following statements is true regarding the authority of the chief audit executive (CAE) to release previous audit reports to outside parties?
- A. The CAE can release prior information provided it is as originally published and distributed within the organization.
- B. The CAE can release prior internal audit reports with the approval of the board and senior management.
- C. The CAE can employ judgment and release prior audit results as they deem appropriate and necessary.
- D. The CAE can only release prior information outside the organization when mandated by legal or statutory requirements.
Answer: C
NEW QUESTION 265
Which of the following conditions should a chief audit executive take into account when deciding if a follow-up audit engagement is necessary?
* The reported observations were significant and high risk.
* Internal audit resources and the time it will require for follow-up.
* Management may not have the resources to take action.
* Management has previously decided not to take any action.
- A. 1, 3, and 4 only
- B. 1, 2, and 3 only
- C. 2, 3, and 4 only
- D. 1, 2, and 4 only
Answer: D
Explanation:
Section: Volume D
NEW QUESTION 266
Which of the following factors would not be considered in determining appropriate follow-up procedures?
- A. The availability of funds in the audited department's budget to correct the reported condition.
- B. The potential consequences if the corrective action fails.
- C. The significance of the audit finding.
- D. The effort and cost needed to correct the reported condition.
Answer: A
NEW QUESTION 267
What would be used to determine the collectability of accounts receivable balances?
- A. Positive accounts receivable confirmations.
- B. An aged accounts receivable listing.
- C. The file of related shipping documents.
- D. Negative accounts receivable confirmations.
Answer: B
NEW QUESTION 268
After partially completing an internal control review of the accounts payable department, an auditor suspects that some type of fraud has occurred. To ascertain whether the fraud is present, the best sampling approach would be to use:
- A. Judgmental sampling to select a sample of vouchers processed by clerks who were identified by the department manager as acting suspiciously.
- B. Simple random sampling to select a sample of vouchers processed by the department during the past year.
- C. Discovery sampling to select a sample of vouchers processed by the department during the past year.
- D. Probability-proportional-to-size sampling to select a sample of vouchers processed by the department during the past year.
Answer: C
NEW QUESTION 269
Which of the following is not a primary purpose for conducting a walk-through during the initial stages of an assurance engagement?
- A. To help develop process maps.
- B. To determine segregation of duties.
- C. To test the adequacy of controls.
- D. To identify residual risks.
Answer: C
NEW QUESTION 270
In a sampling application, the group of items about which the auditor wants to estimate some characteristic is called the:
- A. Sampling unit.
- B. Attribute of interest.
- C. Population.
- D. Sample.
Answer: C
Explanation:
Section: Volume A
NEW QUESTION 271
An internal auditor has a recommendation to change operations which could potentially increase profits by
$50,000. The best way to sell this recommendation to management is to:
- A. Wait until the exit conference to discuss it in order to ensure all affected parties are present.
- B. Discuss it with operating supervisors who are directly affected by the change, and then with department management.
- C. Carefully work out the details of implementation before presenting it to department management.
- D. Bring it to the audit manager, who should bring it immediately to senior management's attention.
Answer: B
NEW QUESTION 272
To furnish useful and timely information and promote improvements in operations, internal auditors should provide:
- A. Information in written form before it is discussed with the engagement client.
- B. Operating management with reports that emphasize general concerns and risks.
- C. Senior management with reports that emphasize the operational details of defective conditions.
- D. Reports that meet the expectations of both operational and senior management.
Answer: D
NEW QUESTION 273
A chief audit executive (CAE) has decided to add an engagement to the current audit plan which will exceed available audit resources. Which of the following is the best course of action for the CAE to take?
- A. Present the plan change to senior management and request additional resources before going to the board of directors.
- B. Add this change to the plan and request senior management to indicate which other engagement should be deleted to keep the overall plan within resource constraints.
- C. Seek approval from senior management and the board of directors for the plan change and advise them of the issue of limited resources.
- D. Immediately seek additional resources from senior management and the board of directors to meet the needs of the organization.
Answer: C
Explanation:
Section: Volume C
NEW QUESTION 274
A chief audit executive agrees to conduct an engagement that will focus on customers' perceptions of the quality of the organization's products and services. Which of the following issues should be addressed first?
- A. Supplier deliveries.
- B. Customer complaints.
- C. Cost-effectiveness.
- D. Quality control.
Answer: B
NEW QUESTION 275
A retail sales company has discontinued a product that normally sold for $100. During the first month of a sale of the product, a 20 percent discount was given. Later that sale price was reduced by an additional 40 percent.
What was the overall discount from the original selling price?
- A. 48 percent.
- B. 52 percent.
- C. 30 percent.
- D. 60 percent.
Answer: B
Explanation:
Section: Volume B
NEW QUESTION 276
......
Authentic Best resources for IIA-CIA-Part2 Online Practice Exam: https://www.examtorrent.com/IIA-CIA-Part2-valid-vce-dumps.html
Get the superior quality IIA-CIA-Part2 Dumps Questions from ExamTorrent: https://drive.google.com/open?id=1SyEUmJxJ98KGAYkbov6ohRmE7xLtEcIQ
