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2024 Realistic Verified Free IIA IIA-CIA-Part1 Exam Questions
IIA-CIA-Part1 Certification Exam is an essential step for individuals who want to start a career in internal auditing. Essentials of Internal Auditing certification demonstrates to employers that the individual has the necessary knowledge and skills to perform internal auditing tasks effectively. Essentials of Internal Auditing certification also provides a competitive advantage to individuals who want to advance their career in the field of internal auditing.
NEW QUESTION # 85
The chief commodity trader for a large energy company learns from a friend that a competitor will likely fail its upcoming regulatory audit and will be forced to temporarily decrease production. If the information is true, the trader has short-term opportunities to make trades that will financially benefit the trader's company and will lead to a substantial increase in the trader's performance bonus. However, if the information is not true, making the trades will significantly increase the company's risk of being caught in a long position. From an ethical perspective, which of the following would be the most appropriate course of action for the trader to take?
- A. Have another trader on staff make the trade in order to avoid a conflict of interest.
- B. Defer the decision to management and risk the loss of the trading opportunity.
- C. Disclose the information to the risk oversight committee but proceed with the trade to capitalize on the opportunity.
- D. Make the trade because the company and the trader will both benefit.
Answer: B
Explanation:
Section: Volume B
Explanation/Reference:
NEW QUESTION # 86
Some of a company's payroll transactions were batch posted to the payroll file but were not uploaded correctly to the general ledger file on the mainframe. The best control to detect
this type of error would bE.
- A. Validation of hash totals.
- B. Reconciliation of paychecks to the bank account.
- C. Appropriate segregation of duties for batch approval.
- D. Edit controls on the payroll file.
Answer: A
NEW QUESTION # 87
Which of the following would decrease or be reduced if an organization establishes and implements excessive internal controls?
- A. Staff productivity.
- B. Activities that add no value.
- C. Production cycle time.
- D. Complexity of operations.
Answer: A
NEW QUESTION # 88
Which of the following is an example of a preventive control activity for risk related to pollution caused by waste disposal?
- A. Seeking legal consultation from a firm with experience in environmental law.
- B. Offering an education program delivered by environmental experts.
- C. Taking periodic samples of the area at risk and logging the results.
- D. Maintaining strict security around environmental department files.
Answer: B
NEW QUESTION # 89
Which of the following fraud schemes is often an off-book fraud*?
- A. Corruption
- B. Disbursement fraud
- C. Payroll fraud
- D. Information misrepresentation
Answer: A
NEW QUESTION # 90
Which of the following best demonstrates conformance with IIA standards related to continuing professional development?
- A. Retaining supervisory reviews conducted on the basis of the development plan
- B. Seeking guidance regarding internal audit best practices from The IIA
- C. Giving consideration to certain areas of specialization as part of development planning
- D. Retaining evidence of training in the form of continuing education credits
Answer: B
NEW QUESTION # 91
During an audit of a major contract, an internal auditor finds that actual hours and dollars billed are consistently at or near budgeted amounts. This condition is a red flag for which of the following procurement fraud schemes?
- A. Defective pricing.
- B. Cost mischarging.
- C. Bid rotation.
- D. Fictitious vendor.
Answer: B
Explanation:
Section: Volume C
NEW QUESTION # 92
Which of the following scenarios best illustrates the Fraud Triangle component known as "perceived opportunity"?
- A. Duties are not properly segregated.
- B. Substantial bonuses are awarded if financial targets are met.
- C. Employees may perceive favoritism and feel overlooked and resentful.
- D. Bonuses may not be paid this year.
Answer: A
NEW QUESTION # 93
An internal auditor at a multinational organization is reviewing the effectiveness of the organization's risk management framework. In this scenario, which of the following statements is true?
- A. To achieve an effective internal control environment, the organization's risk management plan must be documented and communicated to all levels throughout each region.
- B. Regardless of their location, employees at all levels share responsibility for designing effective controls to mitigate risks.
- C. The auditor should consider local cultures and customs in various regions when assessing control effectiveness.
- D. Setting clear objectives is a precondition to effectively identifying, assessing, and responding to the organization's risks.
Answer: B
NEW QUESTION # 94
When an internal auditor applies due professional care to perform an assurance engagement, which of the following must she consider?
1. Findings of the last audit engagement performed.
2. Probability of significant errors, irregularities, or noncompliance.
3. Extent of work needed to achieve engagement objectives.
4. Cost of the engagement versus the potential benefits.
- A. 2 and 3 only
- B. 2, 3, and 4 only
- C. 1, 2, 3, and 4
- D. 1 and 4 only
Answer: B
NEW QUESTION # 95
The audit committee has asked the chief audit executive (CAE) to assist in the selection of a new external audit firm.
Which of the following is an appropriate action by the CAE?
- A. The CAE and two managers from the audit staff review the bids and select one firm to meet with the audit committee for the committee's approval.
- B. The CAE declines to participate in the process because providing this assistance would result in compromising the internal audit activity's objectivity.
- C. The CAE, chief financial officer, and controller review the bids, interview two firms, and recommend one of the two firms to the audit committee for its approval.
- D. The CAE develops a formal set of criteria for the audit committee to use in selecting the external auditor.
Answer: D
NEW QUESTION # 96
Which of the following controls would most likely prevent the input of an unreasonable number of labor hours into a costing system?
- A. Programmed limit tests of input fields.
- B. Reconciliation of input control totals.
- C. Consistency checks of data in input fields.
- D. Recalculation tests during processing.
Answer: A
NEW QUESTION # 97
According to IIA guidance, which of the following actions best demonstrates due professional care by an internal auditor when she discovers a number of fraud-related red flags during an audit engagement?
- A. Suspend the engagement and undertake a formal fraud investigation.
- B. Perform further testing to verify the existence of fraud.
- C. Conclude the engagement and inform management that fraud has occurred
- D. Notify the board of the possible fraud immediately
Answer: B
NEW QUESTION # 98
According to IIA guidance, which of the following would be included in an internal audit charter to help establish the authority of the internal audit activity?
- A. Document the chief audit executive's (CAE's) reporting line
- B. Outline expectations for communicating the results of all aspects of the internal audit activity.
- C. Document agreement between the CAE and the individual to whom the CAE reports
- D. Declare the internal audit activity's accountability for safeguarding assets and confidentiality.
Answer: A
NEW QUESTION # 99
While attending a conference, an internal auditor won an all-expense paid trip sponsored by a vendor of the internal auditor's organization. Which of the following actions are most appropriate for the auditor to take?
- A. Give the prize to a friend or family member and review the organization's ethics policy.
- B. Consult with an immediate supervisor and notify the organization's audit committee.
- C. Give the prize to a friend or family member and notitfy the organization's audit committee.
- D. Consult with an immediate supervisor and review the organization's ethics policy.
Answer: D
NEW QUESTION # 100
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IIA-CIA-Part1 exam consists of 125 multiple-choice questions that are designed to test candidates' knowledge of internal auditing principles and practices. IIA-CIA-Part1 exam is timed and candidates have four hours to complete it. IIA-CIA-Part1 exam is computer-based and is available at Pearson VUE testing centers worldwide.
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