Ethics, Compliance, and Regulatory Standards Flashcards
7 cards from real CCA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Ethics, Compliance, and Regulatory Standards flashcards as text
A construction auditor discovers that a project manager has been splitting purchase orders to stay below the competitive bidding threshold. What ethical obligation does the auditor have?
Answer: Report the finding as a bid-splitting violation regardless of amounts
Bid splitting to circumvent competitive bidding requirements is a procurement violation that must be reported regardless of the dollar amounts involved.
Under the False Claims Act, which condition subjects a contractor to liability?
Answer: Knowingly submitting a false or fraudulent claim for payment to the federal government
The False Claims Act imposes liability on any person who knowingly submits a false or fraudulent claim for payment to the U.S. government.
The IIA Code of Ethics requires internal auditors to exhibit which of the following regarding conflicts of interest?
Answer: Avoid situations that impair or appear to impair objectivity
The IIA Code of Ethics requires auditors to avoid any conflict of interest, real or apparent, that could impair their objectivity.
Which federal act establishes prevailing wage requirements for laborers and mechanics on federally funded construction projects?
Answer: The Davis-Bacon Act
The Davis-Bacon Act requires payment of prevailing wages to workers on federally funded or assisted construction contracts exceeding $2,000.
When an auditor identifies a potential legal violation during a construction audit, the most appropriate first step is to:
Answer: Consult with legal counsel before proceeding
Auditors should consult legal counsel when potential legal violations are identified to determine proper reporting and investigation procedures.
A construction auditor is asked by a senior executive to exclude a significant finding from the audit report to avoid embarrassment. The auditor should:
Answer: Refuse and maintain the finding, escalating if necessary
Auditors must maintain objectivity and integrity; if management attempts to suppress valid findings, the auditor must escalate to the audit committee or board.
The Sarbanes-Oxley Act Section 404 most directly impacts construction companies that are:
Answer: Publicly traded and required to assess internal controls over financial reporting
SOX Section 404 requires publicly traded companies to assess and report on the effectiveness of internal controls over financial reporting.