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IIA Certification in Risk Management Assurance Sample Questions:

1. An auditor in charge was reviewing the workpapers submitted by a newly hired internal auditor. She noted that the new auditor's analytical work did not include any rating or quantification of the risk assessment results, and she returned the workpapers for correction. Which section of the workpapers will the new auditor need to modify?

A) Condition section.
B) Effect section.
C) Cause section.
D) Criteria section.

2. Management of a publicly-held organization requires the internal audit activity to be involved with quarterly financial statements, which are made public and used internally. Which of the following explanations of management's decision is least plausible?

A) Management may be concerned about its reputation in the financial markets.
B) Management is following best-practice protocol, as stipulated by the Standards, which states that internal auditors must review quarterly financial statements.
C) Management may perceive that having quarterly financial information examined by the internal auditors enhances the information's value to internal decision making.
D) Management may be concerned about potential penalties that could occur if quarterly financial statements are misstated.

3. Which of the following is the most common method of fraud detection?

A) Unannounced audits or reviews of programs or departments.
B) Analytical reviews of high-risk areas.
C) Tips received from employees or citizens.
D) Detective controls built into the daily processes.

4. Which of the following activities should the chief audit executive perform to ensure compliance with an organization's code of conduct?

A) Review and adjudicate all violations of the code of conduct.
B) Lead the committee responsible for the oversight of the code.
C) Act as an adviser to the committee responsible for reviewing violations of the code.
D) Implement a system of procedures to inform all employees of the code.

5. An auditor identifies three errors in the sample of 25 entries selected for review (a 12 percent error rate).
Based on this result, the auditor assumes that approximately 59 of the total population of 492 entries are incorrect. To reach this assumption, the auditor has used a technique known as which of the following?

A) Variability tolerance.
B) Ratio estimation.
C) Stratification.
D) Acceptance sampling.

Solutions: