CRMA Basic

Question 1

An internal auditor must suggest a policy aspect to be included in an organization's code of ethics. Which of the suggestions below would be the most effective?

Accepted Answer

Ethical behavior should be included in performance evaluations.

Answer

Whistleblowing should be discouraged since it might create distrust among staff.

Answer

Senior management should be given explicit exclusions from the code of ethics.

Answer

Ethics should differ according to local cultures in the organization's international activities.

Question 2

Which of the following forms of fraud involves embezzlement?

Accepted Answer

Misappropriation of assets

Answer

Corruption

Answer

Fraudulent statements

Answer

Bribery

Question 3

Which of these scenarios is an example of risk management avoidance action?

Accepted Answer

Exiting a marketplace

Answer

Getting product insurance

Answer

Outsourcing production

Answer

Recalling a product

Question 4

Which of the following assertions, according to IIA advice, illustrates the similarities between assurance and consulting services?

Accepted Answer

Internal auditors must organize assurance and consulting engagements with the strategy and objectives of the activity under evaluation in mind.

Answer

Internal auditors shall not give assurance or consulting services for an activity for which they were responsible in the previous year.

Answer

Both assurance and consulting services often include the internal auditor, the area being reviewed, senior management, and the board.

Answer

Internal auditors establish the engagement objectives, scope, and work plan for assurance and consulting services.

Question 5

What is the main use of a fishbone diagram?

Accepted Answer

To determine the potential causes of adverse circumstances.

Answer

To express the frequency of adverse circumstances in a certain process.

Answer

To represent the areas of responsibility for departments within an organization.

Answer

To design and manage difficult tasks like internal audits.

Question 6

In which circumstance would a customer care hotline get a large amount of complaints about payments not applied to customers' accounts?

Accepted Answer

A worker is tampering with customer checks.

Answer

The customer service department does not convey concerns to the accounts receivable department.

Answer

Employees are filling out false expense reports.

Answer

Invoices are not being mailed to customers.

Question 7

Which of the following would be the most helpful to a chief audit executive who is determining internal audit workforce requirements?

Accepted Answer

Discussions with top management and the audit committee on audit needs yielded results.

Answer

The most recent performance reviews conducted by the audit staff.

Answer

A check of audit personnel's education and training records.

Answer

Information on the size and makeup of comparable audit teams.

Question 8

A manufacturing line supervisor joins the internal audit activity for a two-year cycle and is assigned to an accounts receivable audit. Which of the following should be the audit manager's major priority when working on this assignment?

Accepted Answer

Due professional care

Answer

Individual objectivity

Answer

Organizational independence

Answer

Individual independence

Question 9

A snow removal firm is running a scenario planning exercise in which staff analyze the potential consequences of a major drop in annual snowfall for the upcoming winter. Which of the following accurately characterizes this sort of risk?

Accepted Answer

Inherent

Answer

Accepted

Answer

Residual

Answer

Net

Question 10

Which of the following procedures would help an internal auditor evaluate the effectiveness of a wholesale food distributor's process for filling and packaging orders for shipping?

Accepted Answer

Queuing theory is used to identify possible bottlenecks in the process.

Answer

Decision trees compare actual performance to requirements.

Answer

A chart outlining program assessment and review techniques.

Answer

A Bedford review of orders filled and typical delivery times.