IIA-CRMA by IIA Valid Free Exam Practice Test

Question 1

Which of the following would provide the best guidance to a chief audit executive who is setting internal audit staff requirements?

A. A review of audit staff education and training records. B. The results of the audit staff's most recent performance reviews. C. Results from discussions of audit needs with executive management and the audit committee. D. Information about the audit staff size and composition of comparable organizations.

Correct Answer: C

Question 2

Which of the following is not a standard technique that the chief audit executive (CAE) would use to provide evidence of supervisory review of working papers?

A. The CAE utilizes an external third party to make an objective recommendation after each working paper review. B. The CAE prepares a memorandum discussing the results of the working paper review. C. The CAE initials and dates every working paper after it has been reviewed. D. The CAE completes an engagement working paper checklist.

Correct Answer: A

Question 3

Which of the following is a second line of defense in effective risk management and control?

A. Compliance department. B. Credit department. C. Internal audit department. D. Purchasing department.

Correct Answer: A

Question 4

Which of the following audit procedures would provide the most relevant information to identify discrepancies between budgeted versus actual raw material consumption in a production facility?

A. Document verification. B. Analytical review. C. Inquiry. D. Observation.

Correct Answer: B

Question 5

According to IIA guidance, which of the following individuals would best be considered independent for the purpose of participating in an external assessment of the quality assurance and improvement program for an internal audit activity (IAA)?

A. A former employee knowledgeable of the IAA who resigned three years earlier from the organization. B. An employee in the parent organization who has not had any previous contact with the IAA. C. A competent employee of an independent external organization that provides co-sourcing services to the IAA. D. An employee in an affiliated organization who has never worked directly with the IAA.

Correct Answer: A

Question 6

In which of the following scenarios would the chief audit executive (CAE) be required to decline the assignment?

A. There is no expertise within the internal audit team for detecting and investigating fraud. B. The CAE would need to procure external services to deliver the internal audit assurance program. C. There is no available expertise on the internal audit team to perform a consulting engagement. D. There is no expertise within the internal audit team for auditing an IT engagement.

Correct Answer: A

Question 7

The director of purchasing, a certified internal auditor (CIA), signs a contract to procure a large order from a supplier whose products provide the best price, quality, and performance. A few days after signing the contract, the supplier presents the CIA with $1, 000 as a gift. Which statement regarding acceptance of the money is correct?

A. Because the contract was signed before the money was offered, accepting the money would not violate the IIA Code of Ethics. B. Accepting the money would violate the IIA Code of Ethics. C. Because the CIA is not acting as an internal auditor, accepting the money would be governed only by the organization's code of conduct. D. Accepting the money would be prohibited only if it were non-customary.

Correct Answer: B

Question 8

Management has asked the chief audit executive (CAE) to provide assurance on the organization's automated control system related to financial data. The current audit staff does not have the expertise needed to conduct this type of engagement. Which of the following would be the best response by the CAE?

A. Accept the assignment and use an external provider with the necessary knowledge and skills to perform the engagement. B. Accept the assignment if the engagement is included in the current audit plan, but inform senior management that the current audit staff does not have the knowledge and skills required. C. Accept the assignment and use control self-assessment to complete the project. D. Do not accept the assignment because the internal audit activity lacks the competency to perform the engagement with due professional care.

Correct Answer: A

Question 9

During an internal audit, the internal auditor compares the employee turnover rate in the area being audited with the employee turnover rate in the organization as a whole.
This is an example of which of the following analytical auditing procedures?

A. Regression analysis. B. Trend analysis. C. Benchmarking. D. Reasonableness test.

Correct Answer: C

Question 10

Suspecting fraud, the chief financial officer (CFO) asked the internal audit activity to investigate a significant increase in travel related expenditures. Work was performed by a qualified internal auditor. Following the completion of the engagement, the chief audit executive (CAE) reported to the CFO that no violations were found and no fraud had occurred.
According to the Standards, which of the following principles did the CAE violate?

A. Due professional care. B. Individual objectivity. C. Organizational independence. D. Proficiency.

Correct Answer: A

IIA Certification in Risk Management Assurance (CRMA) - IIA-CRMA Exam Practice Test