QUESTION 15
As a matter of policy, the chief audit executive routinely rotates internal audit staff assignments and periodically interviews the staff to discuss the potential for conflicts of interest. These actions help fulfill which of the following internal audit mandates?

QUESTION 16
Which of the following statements about COBIT is not true?

QUESTION 17
After the team member who specialized in fraud investigations left the internal audit team, the chief audit executive decided to outsource fraud investigations to a third party service provider on an as needed basis.
Which of the following is most likely to be a disadvantage of this outsourcing decision?

QUESTION 18
The chief audit executive (CAE) of a small internal audit activity (IAA) plans to test conformance with the Standards through a quality assurance review. According to the Standards, which of the following are acceptable practice for this review?
1. Use an external service provider.
2. Conduct a self-assessment with independent validation.
3. Arrange for a review by qualified employees outside of the IAA.
4. Arrange for reciprocal peer review with another CAE.

QUESTION 19
Which of the following is an example of a detective control?

QUESTION 20
Which of the following statements is true with regard to information protection?

QUESTION 21
A chief audit executive (CAE) was asked to participate in the selection of an external auditor. Which of the following would not be a typical responsibility for the CAE?

QUESTION 22
A supervisor receives a complaint from an employee who is frustrated about having to learn a new software program. The supervisor responds that the new software will enable the employee to work more efficiently and with greater accuracy. This response is an example of:

QUESTION 23
Maintenance cost at a hospital was observed to increase as activity level increased. The following data was gathered:
Activity Level –
Maintenance Cost
Month
Patient Days
Incurred
January
5,600
$7,900
February
7,100
$8,500
March
5,000
$7,400
April
6,500
$8,200
May
7,300
$9,100
June
8,000
$9,800
If the cost of maintenance is expressed in an equation, what is the independent variable for this data?

QUESTION 24
Where complex problems need to be addressed, which of the following communication networks would be most appropriate?

QUESTION 25
An organization accomplishes its goal to obtain a 40 percent share of the domestic market, but is unable to get the desired return on investment and output per hour of labor. Based on this information the organization is most likely focused on which of the following?

QUESTION 26
When granting third parties temporary access to an entity’s computer systems, which of the following is the most effective control?

QUESTION 27
The internal audit activity is planning a procurement audit and needs to obtain a thorough understanding of the subcontracting process, which can involve multiple individuals in multiple countries.
Which of the following internal audit tools would be most effective to document the process and the key controls?

QUESTION 28
Which of the following principles is shared by both hierarchical and open organizational structures?
1. A superior can delegate the authority to make decisions but cannot delegate the ultimate responsibility for the results of those decisions
2. A supervisor’s span of control should not exceed seven subordinates
3. Responsibility should be accompanied by adequate authority
4. Employees at all levels should be empowered to make decisions.

QUESTION 29
Which of the following local area network physical layouts is subject to the greatest risk of failure if one device fails?

QUESTION 30
The security department uncovered what appears to be a complex fraud in the accounting department. The CEO has requested the internal audit activity to investigate the fraud. If the internal audit staff lacks the expertise to conduct the investigation, how should the chief audit executive proceed?

QUESTION 31
Forty-five percent of an organization’s customer payments are submitted online. Eight percent of online payments are rejected. Executive management decides to outsource its online payment services to a contractor that will assume 75 percent of the total value of rejected payments. The organization estimates $1.25 million customer payments due during the contract period.
Which of the following represents the organization’s residual risk for online customer payments due?

QUESTION 32
Which of the following items should the chief audit executive disclose to senior management regarding the results of the internal audit activity’s quality assessments?

QUESTION 33
Which of the following control techniques would minimize the risk of interception during transmission in an electronic data interchange system?
1. Encryption.
2. Traffic padding.
3. Edit checks.
4. Structured data format.

QUESTION 34
An internationally recognized brand name is an entrance barrier to new competitors because new competitors would:

QUESTION 35
An internal auditor needs to recommend a policy element to be included in an organization’s code of ethics.
Which of the following recommendations would be most effective?

QUESTION 36
Which of the following must be adjusted to index a progressive tax system to inflation?

QUESTION 37
In creating a risk-based plan, which of the following best describes a top-down approach to understanding business processes?