IIA IIA-ACCA Test Engine Practice Test Questions, Exam Dumps
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IIA IIA-ACCA Exam Syllabus Topics:
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NEW QUESTION 162
Which of the following activities most significantly increases the risk that a bank will make poor-quality loans to its customers?
- A. Borrowers may not sign all required mortgage loan documentation.
- B. Loan officers may override the lending criteria established by senior management.
- C. Fees paid by the borrower at the time of the loan may not be deposited in a timely manner.
- D. The bank's loan documentation may not meet the government's disclosure requirements.
Answer: B
NEW QUESTION 163
Which of the following techniques would be least effective in resolving the conflict created by an internal audit client's perception of the audit report as a personal attack on his management performance?
- A. The auditor should explore alternative solutions to address the audit problem, so the audit client has options.
- B. The auditor should focus on the audit client as a person and understand him, rather than just concentrating on the problem.
- C. The auditor should take a flexible position on the recommendations and focus on resolving the issue by addressing the interests of the people concerned.
- D. The auditor should make recommendations based on objective criteria, rather than based on a subjective assessment.
Answer: B
NEW QUESTION 164
Which of the following roles would be least appropriate for the internal audit activity to undertake with regard to an organization's corporate social responsibility (CSR) program?
- A. Identify and prioritize the CSR issues that are important to the organization.
- B. Serve as an advisor on internal controls related to CSR.
- C. Evaluate the effectiveness of the organization's CSR efforts.
- D. Consult on project design and implementation of the CSR program.
Answer: A
NEW QUESTION 165
A draft internal audit report that cites deficient conditions generally should be reviewed with which of the following groups?
1. The client manager and her superior.
2. Anyone who may object to the report's validity.
3. Anyone required to take action.
4. The same individuals who receive the final report.
- A. 1 and 2 only
- B. 1, 2, and 4
- C. 1 only
- D. 1, 2, and 3
Answer: D
NEW QUESTION 166
Which of the following is true regarding the use of a formal risk management framework?
1. It facilitates a methodical approach to risk mitigation.
2. It defines and standardizes the terminology used in risk communication.
3. It establishes the risk tolerance levels to be accommodated in the strategy.
4. It facilitates the alignment of risk mitigation strategies with management priorities.
- A. 2. 3, and 4.
- B. 1.3, and 4.
- C. 1,2, and 4.
- D. 1.2, and 3.
Answer: C
NEW QUESTION 167
Which of the following statements is true regarding the capital budgeting procedure known as discounted payback period?
- A. It begins at time zero for the project.
- B. It ignores the time value of money
- C. It calculates the time a project takes to break even.
- D. It calculates the overall value of a project
Answer: C
NEW QUESTION 168
In mergers and acquisitions, which of the following is an example of a horizontal combination?
- A. A petroleum processing company acquires an agro-processing firm.
- B. A baker taking over a competitor.
- C. A movie producer acquires movie theaters.
- D. Dairy manufacturing company taking over a large dairy farm.
Answer: B
NEW QUESTION 169
It is close to the fiscal year end for a government agency, and the chief audit executive (CAE) has the following items to submit to either the board or the chief executive officer (CEO) for approval. According to IIA guidance, which of the following items should be submitted only to the CEO?
- A. A request for an increase of the CAE's salary for the next fiscal year.
- B. The evaluation and compensation of the internal audit team.
- C. The internal audit budget and resource plan for the coming fiscal year.
- D. The internal audit risk assessment and audit plan for the next fiscal year.
Answer: B
NEW QUESTION 170
According to IIA guidance, which of the following would be a primary reason for an internal auditor to test the organization's IT contingency plan?
- A. To identify and address potential security weaknesses within the system.
- B. To ensure that tests contribute to improvement of the program.
- C. To ensure that deficiencies identified by the audit are promptly addressed.
- D. To ensure that adequate controls exist to prevent any significant business interruptions.
Answer: B
NEW QUESTION 171
The chief audit executive of a medium-sized financial institution is evaluating the staffing model of the internal audit activity (IAA). According to IIA guidance, which of the following are the most appropriate strategies to maximize the value of the current IAA resources?
* The annual audit plan should include audits that are consistent with the skills of the IAA.
* Audits of high-risk areas of the organization should be conducted by internal audit staff.
* External resources may be hired to provide subject-matter expertise but should be supervised.
* Auditors should develop their skills by being assigned to complex audits for learning opportunities.
- A. 1 and 2 only
- B. 3 and 4 only
- C. 2 and 3 only
- D. 1 and 4 only
Answer: B
NEW QUESTION 172
According to IIA guidance, which of the following is an area in which the internal auditor should be proficient?
- A. Fundamentals of accounting, economics, and finance.
- B. Computerized information systems.
- C. Management principles.
- D. Internal audit standards, procedures, and techniques.
Answer: D
NEW QUESTION 173
Operational management in the IT department has introduced performance evaluation policies that are linked to employees achieving continuing education hours. This activity is designed to prevent which of the following conditions?
- A. Accountability/reward failure.
- B. Communication failure.
- C. Knowledge/skills gap
- D. Monitoring gap
Answer: C
NEW QUESTION 174
An organization had three large centralized divisions: one that received customer orders for service work; one that scheduled the service work at customer locations; and one that answered customer calls about service problems. These three divisions were restructured into seven regional groups, each of which performed all three functions. One advantage of this restructuring would be:
- A. Increased specialization.
- B. Improved work flow.
- C. Greater economies of scale.
- D. Better internal controls.
Answer: B
NEW QUESTION 175
Which of the following is a disadvantage of selecting a commercial software package rather than developing an application internally?
- A. Incompatibility with client/server technology.
- B. Lack of flexibility.
- C. Employee resistance to change.
- D. Inadequate technical support.
Answer: B
NEW QUESTION 176
When developing the scope of an audit engagement, which of the following would the internal auditor typically not need to consider?
- A. The potential impact of key risks.
- B. The need and availability of automated support.
- C. The expected outcomes and deliverables.
- D. The operational and geographic boundaries.
Answer: A
NEW QUESTION 177
For employees, the primary value of implementing job enrichment is which of the following?
- A. Increased knowledge through the performance of additional tasks.
- B. Support for personal growth and a meaningful work experience.
- C. An increased opportunity to manage better the work done by their subordinates.
- D. Validation of the achievement of their goals and objectives.
Answer: B
NEW QUESTION 178
Which of the following control methods is effective in reducing the risk of purchasing-scheme fraud?
1. Periodically reviewing the vendor list for unusual vendors and addresses.
2. Segregating duties for amount purchasing, receiving, shipping, and accounting.
3. Validating sequential integrity of purchase orders.
4. Verifying the validity of invoices with post office box addresses.
- A. 1, 2, 3, and 4
- B. 1 and 2 only
- C. 1, 2, and 4 only
- D. 3 and 4 only
Answer: D
NEW QUESTION 179
Which of the following best demonstrates an organization's ability to recover from a disaster?
- A. Regular testing of the disaster plan
- B. Cold site
- C. Hot site
- D. Redundant data center
Answer: A
NEW QUESTION 180
After the team member who specialized in fraud investigations left the internal audit team, the chief audit executive decided to outsource fraud investigations to a third party service provider on an as needed basis.
Which of the following is most likely to be a disadvantage of this outsourcing decision?
- A. Familiarity.
- B. Cost.
- C. Independence.
- D. Flexibility.
Answer: A
NEW QUESTION 181
Which of the following documents is most appropriate in promoting the objectivity of the internal audit activity?
- A. Usage of IT system policy.
- B. Acceptance of gifts policy.
- C. Risk management framework.
- D. Personal responsibility policy.
Answer: B
NEW QUESTION 182
Which of the following statements is true regarding cost-volume-profit analysis?
- A. Following breakeven, net operating income will increase by the excess of fixed costs less the variable costs per units sold
- B. Contribution margin is the amount remaining from sales revenue after fixed expenses have been deducted.
- C. Breakeven occurs when the contribution margin covers fixed costs
- D. Breakeven point is the amount of units sold to cover variable costs.
Answer: C
NEW QUESTION 183
After finalizing an assurance engagement concerning safety operations in the oil mining process, the audit team concluded that no key controls were compromised. However, some opportunities for improvement were noted. Which of the following would be the most appropriate way for the chief audit executive (CAE) to report these results?
- A. The CAE should send the final report to operational management only, as there is no need to communicate this information to higher levels.
- B. The CAE should send the final report to operational and senior management and the audit committee.
- C. The CAE should notify operational and senior management that the audit engagement was completed with no significant findings to report.
- D. The CAE should send the final report to operational management and notify senior management and the audit committee that no significant findings were identified.
Answer: D
NEW QUESTION 184
An organization decides to take no action on one of its financial risks because the cost of implementing the control outweighs the value of the asset being protected. Which of the following best describes this risk strategy?
- A. Risk avoidance.
- B. Risk acceptance.
- C. Risk sharing.
- D. Risk-benefit analysis.
Answer: B
NEW QUESTION 185
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