Free Internal Audit Practitioner Exam IIA-IAP Exam Practice Test

Which of the following statements is true regarding root cause analysis?

• Root cause analysis enables internal auditors to improve the effectiveness and efficiency of the organization’s governance, risk management, and control processes.
• Root cause analysis is a simple, straightforward tool that can be implemented by internal auditors who may not possess relevant subject matter expertise.
• Root cause analysis enables internal auditors to reveal multiple causes and recommend control enhancements for each cause identified.

Management has decided that transactions less than $50 no longer require authorization. Which of the following risk management strategies does this represent?

• Avoid.
• Accept.
• Reduce.

When determining the appropriate level of resources needed for an engagement, which of the following would be the first step?Determine the sufficiency of internal audit staffIdentify required technology and audit toolsDetermine travel and related costs for the engagement

Which of the following is an element of a well-formed audit recommendation?

• Factual evidence identified during the engagement.
• Measures to prevent recurrence of the condition.
• Factors that allowed the condition to exist.

An internal auditor is conducting a human resources audit engagement. Which of the following observations would increase the probability of fraud?

• Vague job descriptions.
• Lack of background checks.
• Poor interview skills.

Which of the following is an advantage of communicating audit observations as they are identified?The auditor may receive additional pertinent documentation or other relevant informationThe auditor may not need to communicate the final results of the audit to the boardThe auditor may be able to plan more efficiently next year’s audit

To be organizationally independent, the chief audit executive should administratively report to which of the following?

• The audit committee.
• The board of directors.
• The chief executive officer.

During which stage of an audit engagement would the engagement supervisor identify the tasks that were already completed and the remaining tasks to be performed?

• When allocating resources.
• When developing the test approach.
• When documenting the work program.

Which of the following would have the most direct impact on management's decision regarding the amount of risk that is considered acceptable?

• Risk capacity.
• Risk appetite.
• Risk perception.

Which of the following conditions involving the chief audit executive (CAE) is most likely to impair the independence of the internal audit activity?

• The CAE regularly attends and participates in critical executive management meetings for the organization.
• The CAE has direct access to records, personnel, and physical properties throughout the organization.
• The CAE reports directly to the controller for the organization, and the internal audit activity resides in the office of the comptroller.