Certified Internal Auditor Certified Internal Auditor 3

Question 1

During an audit, an internal auditor discovers that a senior manager is circumventing established controls. The auditor should FIRST:

Accepted Answer

Inform the chief audit executive and consider escalation to the audit committee

Answer

The auditor should escalate findings involving senior management misconduct to the CAE, who may then communicate with the audit committee.

Question 2

The concept of 'due professional care' in internal auditing requires auditors to:

Accepted Answer

Apply the skill and diligence of a reasonably prudent auditor

Answer

Due professional care means applying the skill and diligence expected of a reasonably prudent and competent internal auditor.

Question 3

Which sampling method gives every item in a population an equal chance of selection and is considered the purest form of statistical sampling?

Accepted Answer

Simple random sampling

Answer

Simple random sampling gives each item an equal probability of selection, making it the purest statistical sampling technique.

Question 4

An internal audit function's organizational independence is BEST supported by:

Accepted Answer

Reporting administratively to the CFO and functionally to the audit committee

Answer

Dual reporting — administratively to senior management and functionally to the audit committee — provides optimal organizational independence.

Question 5

A control that prevents errors or irregularities from occurring is BEST classified as:

Accepted Answer

Preventive control

Answer

Preventive controls are designed to stop errors or irregularities before they occur, as opposed to detecting or correcting them after the fact.

Certified Internal Auditor Practice Test