[Dec-2021] Verified IIA IIA-CRMA Bundle Real Exam Dumps PDF
IIA-CRMA Dumps PDF New [2021] Ultimate Study Guide
NEW QUESTION 86
A government agency maintains a system of internal control, according to the COSO model, and has made a change to its employee performance reviews and rewards program. This change relates to which of the following components of COSO's internal control framework?
- A. Control activities.
- B. Information and communication.
- C. Control environment.
- D. Monitoring activities.
Answer: C
NEW QUESTION 87
Sometimes, internal audit staff may partner with operating managers to rank risks. Which of the following outcomes may be the most beneficial aspects of this strategy?
1. Reappraising risks levels.
2. Providing accurate information to management.
3. Marketing the internal audit activity.
4. Planning safeguards for assets in high-risk areas.
- A. 1 and 3.
- B. 2 and 3.
- C. 1 and 2.
- D. 3 and 4.
Answer: A
NEW QUESTION 88
According to the Standards, which of the following is not a consideration when exercising due professional care for an assurance engagement?
- A. The extent of assurance services necessary to ensure that all risks are identified.
- B. The probability of significant errors, irregularities or instances of noncompliance.
- C. The cost of providing the assurance services in relation to potential benefits.
- D. The relative complexity, materiality, or significance of matters to which assurance procedures are applied.
Answer: A
NEW QUESTION 89
Upon joining the internal audit activity, each new auditor receives a copy of the audit handbook. Which of the following handbook policies has the greatest risk of compromising audit objectivity?
- A. Internal auditors should have direct and unrestricted access to personnel and information throughout the organization and the governing board.
- B. Internal auditors should obtain 80 hours of continuing professional education every two years, 20 of which should be audit-related, and the remainder may be operations-related.
- C. Internal auditors should undergo annual performance appraisals conducted by the chief audit executive, who reports administratively to the chief financial officer.
- D. Internal auditors should rotate to other areas of the organization for nonaudit assignments to gain an understanding of the organization's operations.
Answer: D
NEW QUESTION 90
Which of the following techniques would best assist an internal auditor in evaluating the efficiency of a wholesale grocery distributor`s process to fill and package orders for shipping?
- A. A program evaluation and review technique chart.
- B. Decision trees rating actual performance against requirements.
- C. A Bedford analysis of orders filled to average delivery times.
- D. Queuing theory to assess potential bottlenecks in the process.
Answer: D
NEW QUESTION 91
During an audit, the client questions the internal audit activity's authority to perform procedures over fraud allegations. According to HA guidance, which of the following would provide the most relevant support to respond to the client's concerns?
- A. Definition of Internal Auditing.
- B. MA Standards.
- C. The IIA's Code of Ethics.
- D. Internal audit charter.
Answer: D
NEW QUESTION 92
A candidate has applied for an entry level internal audit position. The candidate holds a CISA (Certified Information Systems Auditor) designation, and has six months of audit experience, but limited knowledge of accounting principles and techniques. According to the IIA guidance, which of the following is the most relevant reason for the chief audit executive to consider this candidate?
- A. The candidate's information systems knowledge and real-world experience in internal auditing.
- B. Other internal auditors possess sufficient knowledge of accounting principles and techniques.
- C. An entry level position does not require expertise in any particular area.
- D. Accounting skills can be learned over time with appropriate training.
Answer: A
NEW QUESTION 93
Which of the following describes a key characteristic related to effective organizational communication?
- A. Unique operating environments with varying complexity.
- B. A culture of integrity and transparency.
- C. Comprehensive supervisory and verification procedures.
- D. A well-designed system of internal controls.
Answer: D
NEW QUESTION 94
What is the primary benefit to the internal audit activity for undertaking an internal quality assessment?
- A. To identify key risks and areas of concern within the organization.
- B. To identify inefficiencies within the internal audit team.
- C. To help the internal audit activity complete its annual assurance plan.
- D. To help improve the overall quality of the internal audit activity's work.
Answer: D
NEW QUESTION 95
An organization invests its savings in a volatile stock with the potential for high gains rather than a mutual fund with a lower expected return and lower volatility. This best describes which of the following risk concepts?
- A. Risk capacity.
- B. Risk identification.
- C. Risk tolerance.
- D. Risk appetite.
Answer: C
NEW QUESTION 96
Which of the following actions would be characterized as a preventive control to safeguard inventory from the risk of theft?
1. Locking doors and physically securing inventory items.
2. Independently observing the receipt of materials.
3. Conducting monthly inventory counts.
4. Requiring the use of employee ID badges at all times.
- A. 1 and 3.
- B. 1 and 4.
- C. 2 and 4.
- D. 2 and 3.
Answer: B
NEW QUESTION 97
An internal auditor makes a series of observations when performing an analytical review of division operations. The auditor notes the following things: the current ratio is increasing and the quick ratio is decreasing, sales and current liabilities have remained constant, and the number of day sales in inventory is increasing. Which conclusion should the auditor draw from this data?
- A. The division produced fewer items this year than in prior years.
- B. The gross margin has decreased.
- C. The gross margin has increased.
- D. Cash or accounts receivable has decreased.
Answer: D
NEW QUESTION 98
In which of the following scenarios would a customer service hotline receive a high volume of complaints regarding payments not being applied to customers' accounts?
- A. Employees are submitting fraudulent expense reports.
- B. The customer service department is not forwarding complaints to the accounts receivable department.
- C. Invoices are not being mailed to customers.
- D. An employee is tampering with customer checks.
Answer: D
NEW QUESTION 99
Which of the following is an example of a directive control?
- A. Incentive compensation plans.
- B. Exception reports.
- C. Automated reconciliations.
- D. Segregation of duties.
Answer: A
NEW QUESTION 100
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 potential penalties that could occur if quarterly financial statements are misstated.
- B. Management may perceive that having quarterly financial information examined by the internal auditors enhances the information's value to internal decision making.
- C. Management may be concerned about its reputation in the financial markets.
- D. Management is following best-practice protocol, as stipulated by the Standards, which states that internal auditors must review quarterly financial statements.
Answer: D
NEW QUESTION 101
Which of the following would be the most important consideration by the internal audit activity when selecting employees to perform an internal quality assessment?
- A. Previous experience working with the internal audit activity.
- B. The nature of their regular duties and responsibilities.
- C. Their understanding of auditing standards.
- D. Their reporting line within the organization.
Answer: C
NEW QUESTION 102
After being terminated due to downsizing, an internal auditor finds a different job with an organization in the same industry. Which of the following actions would violate the IIA Code of Ethics?
- A. In preparing for an audit at the previous organization, the auditor had conducted a great deal of research on the Internet at home to identify best practices for the management of a treasury function. The auditor has retained much of the research and uses it to conduct an audit of the new employer's treasury function.
- B. To determine audit priorities in the new job, the auditor uses the audit risk approach that the auditor's previous employer used, without receiving permission to do so.
- C. At the new organization, the auditor is asked to develop forms to implement probability-proportional-to-size sampling. Although unsure of how to perform this type of sampling, the auditor proceeds without asking for assistance.
- D. In the first week at the new organization, the auditor discovers a high fraud risk surrounding the organization's database and suggests that the information technology department implement a new password system to prevent fraudulent actions before they occur.
Answer: C
NEW QUESTION 103
Which of the following would be considered a violation of The IIA's mandatory guidance on independence?
- A. The board seeks senior management's recommendation before approving the annual salary adjustment of the CAE.
- B. The CAE confirms to the board, at least once every five years, the organizational independence of the internal audit activity.
- C. The chief audit executive (CAE) reports functionally to the board and administratively to the chief financial officer.
- D. The CAE updates the internal audit charter and presents it to the board for approval periodically, not on a specific timeline.
Answer: A
NEW QUESTION 104
According to the Standards, for how long should internal auditors who have previously performed or had management responsibility for an operation wait to become involved in future internal audit activity with that same operation?
- A. Three months.
- B. Six months.
- C. One year.
- D. Two years.
Answer: C
NEW QUESTION 105
Which of the following is not an objective of internal control?
- A. Accuracy.
- B. Validation.
- C. Efficiency.
- D. Compliance.
Answer: B
NEW QUESTION 106
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