MULTIPLE-CHOICE QUESTIONS a. Integrity b. Objectivity c. Confidentiality d. Privacy. elect the best answer for each of the following uestions A primary purpoe stermal of the Standards is to: a. Promote coordination of internal and external The IM Sue professiona acfllowing The IIA's Standards require internal auditors to exercise due professional care while assurance engagements. Which of the following is not something an internal auditor is required s. audit efforts. b. Establish a basis for evaluating internal audit conducting c. Develop consistency in internal audit practices. d. Provide a codification of existing practices. sider in determining what constitutes the exercise of due care in an assurance engagement treasury operations? Which of the following are "mandatory guidance" in The IIA's IPPF L. Implementation Guides. II. The Code of Ethics. III. The Definition of Internal Auditing. IV. The Standards. a. I. II, and IV b. II and IV c. II, III, and IV a. The audit committee has requested assurance on the treasury function's compliance with a new policy on use of financial instruments. b. Treasury management has not instituted any risk c. The independent outside auditors have requested d. The treasury function just completed to see the engagement report and working papers I. II, III, and ry. tracking system. 6. In which of the following situations does the internal An internal auditor provides income tax services during the tax season. For which of the following auditor potentially lack objectivity? a. A payroll accounting employee assists an internal activities would the auditor most likely be considered in violation of The IIA's Code of Ethies? auditor in verifying the physical inventory of small a. Preparing, for a fee, a division manager's personal motors. tax returns retirement planning and tax issues. class at the local junior college. small CPA firm. b. An internal auditor discusses a significant issue with the vice president to whom the auditee reports prior to drafting the audit report. b. Appearing on a local radio show to discuss c. Receiving a stipend for teaching an evening tax d. Working on weekends for a friend who has a c. An internal auditor recommends standards of control and performance measures for a contract with a service organization for the processing of payroll and employee benefits. d. A former purchasing assistant performs a review An internal auditor is auditing a division in which the division's chief financial officer (CFO) is a close, of internal controls over purchasing four months after being transferred to the internal audit personal friend. The auditor learns that the friend is to be replaced after a series of critical contract negotiations with the Department of Defense. The auditor relays this information to the friend. eh principle of The IIA's Code of Ethics has MULTIPLE-CHOICE QUESTIONS Which of the following is/are Standards? L Statements. 11. Interpretations. III. Glossary a. I only b. I and II. c. 1 and I11, d. I, I1, and III. According to the Standards, which of the following b. Promote an ethical culture in the internal sudit s onents of the c. Obtain an annusl represetation from of internal eontrols to peevenn d. Assess whether the IT gvernance of Wegal acts organization's strategies and obijectives Professional Practice of Internal Audinin the sustains and sopponts the 11. Which of the following is a Core Principle for the a. Maintain confidentiality t the internal audit manager think about when considering appropriate due care while planning an assurance engagement? a. The opportunity to cross-train internal audit staf b. The cost of assurance in relationship to potential e. Develop consistency in internal audit peactices d. Is appropriately positioned and adequately benefits e. Job openings in the area that may be of interest to 12. According to the Standards, how is the independence of the internal audit function achived? internal auditors assigned to the engagement. d. The potential to deliver consulting services to the a. Stafling and supervision. b. Organizational status and objectivity c. Human relations and communications d. Quality assurance and internal review auditee. Which of the following types of IPPF guidance requires) public exposure? I. A new Implementation Guide. IL. A new standard. III. New Supplemental Guidance for auditing g. 13. To determine what needs to be done regarding follow-up on an assurance engagement the internal audit staff jast completed, one would consult . The Attribute Standards: Assurance Services cybersecurity IV. A new definition in the Standards Glossary a. III only b. II and Iv c. II, III, and IV d. I, II, II1, and IV b. The Performance Standards: Consulting Services Implementation Standards c. The Attribute Standards: Consulting Services Implementation Standards d. The Performance Standards: Assurance Services 10. Which of the following are required of the internal audit function per the Standards? a. Evaluate the effectiveness of the audit committee annually the organization's system of internal controls annually b. Issue an overall opinion on the adequacy of 2-41 TERNAL AUDIT PROPESSION AUTHORITATIVE GUIDANCE FOR THE IN THE INTERNATIONAL PROFESSIONAL PRACTICES FRAMEWORK MULTIPLE-CHOICE QUESTIONS 5 Which of the following would be a violation of The IIAs Code of Ethics? 14. In addition to the Standards, some internal 15. audit departments follow other standards in conducting their work, either because of regulatory requirements or by choice. When these other standards are inconsistent with IIA Standards, what should the aadit department do? a. Follow ILA Standards. b. Follow the other standards. c. Follow the standard that is least restrictive. a. An internal auditor was subpoenaed in a court case in which a joint venture partner claimed to have been defrauded by the auditor's company The auditor divulged confidential audit information to the court during testimony b. During an audit, an internal auditor learned that the company was about to introduce a new product that would revolutionize the industry Because of the probable success of the new product, the product manager suggested that the internal auditor buy additional stock in the company, which the auditor did. d. Follow the standand thatis most restrictive c. An internal auditor's husband inherited 25,000 shares of company stock when his grandfather died. They have held the stock for more than two years. d. An internal auditor works weekends doing tax returns for a friend who owns a small CPA firm. 2-42 INTERNAL AUDITING ASSURANC & ADVSORY SERVICES