[Apr 24, 2024] Get Up-To-Date Real Exam Questions for IIA-CRMA-ADV with New Materials
Updated IIA-CRMA-ADV Certification Exam Sample Questions
NEW QUESTION # 101
According to the IIA guidance, who is responsible for periodically assessing the internal audit activity?
- A. The board.
- B. The chief audit executive.
- C. Senior management.
- D. The external auditors.
Answer: B
NEW QUESTION # 102
What is the primary purpose of a fishbone diagram?
- A. To depict the areas of responsibility for departments in an organization.
- B. To identify the possible causes of adverse conditions.
- C. To represent the frequencies of adverse conditions in a given process.
- D. To plan and control complex projects, such as internal audits.
Answer: B
NEW QUESTION # 103
While auditing an organization's credit approval process, an internal auditor learns that the organization has made a large loan to another auditor's relative. Which course of action should the auditor take?
- A. Immediately withdraw from the audit engagement.
- B. Disclose in the engagement final communication that the relative is a customer.
- C. Proceed with the audit engagement, but do not include the relative's information.
- D. Have the chief audit executive and management determine whether the auditor should continue with the audit engagement.
Answer: D
NEW QUESTION # 104
Which of the following is a requirement for an assurance engagement that may not be for a consulting engagement?
- A. The internal audit activity has to ensure team members' objectivity is not impaired.
- B. The scope and objective of the engagement is agreed upon based on the engagement client's needs.
- C. The internal audit activity must ensure management actions have been implemented effectively or risk accepted.
- D. Auditors cannot participate in an assurance engagement of a function for which they previously performed a consulting engagement.
Answer: D
NEW QUESTION # 105
Which of the following is true regarding the use of a formal risk management framework?
1. It facilitates a methodical approach to risk mitigation.
2. It defines and standardizes the terminology used in risk communication.
3. It establishes the risk tolerance levels to be accommodated in the strategy.
4. It facilitates the alignment of risk mitigation strategies with management priorities.
- A. 2. 3, and 4.
- B. 1,2, and 4.
- C. 1.3, and 4.
- D. 1.2, and 3.
Answer: B
NEW QUESTION # 106
Which of the following techniques would provide the most compelling evidence that a safety hazard exists within a manufacturing facility?
- A. Analysis of facility operating reports, focusing on instances when breakdowns occurred.
- B. Questioning of facility management, including the facility safety officer.
- C. Observation of the facility during operations.
- D. Review of records involving safety violations, filed by facility production employees.
Answer: C
NEW QUESTION # 107
While preparing for an audit of senior management expenses, the chief audit executive (CAE) learns that management is unable to locate a number of original expense claims to support the related disbursements. She decides to defer the engagement until they can be located. Which of the following principles likely guided the CAE's decision?
- A. Objectivity.
- B. Proficiency.
- C. Due professional care.
- D. Independence.
Answer: C
NEW QUESTION # 108
Which of the following offers the best evidence that the internal audit activity has achieved organizational independence?
- A. An independent third party has assessed the organization's system of internal controls to be adequate and effective.
- B. The mission statement and strategy of the internal audit activity demonstrates alignment to organizational objectives.
- C. The internal audit charter is drafted properly and approved by the appropriate parties.
- D. The chief audit executive reports both functionally and administratively to the CEO.
Answer: D
NEW QUESTION # 109
Which of the following best ensures the independence of the internal audit activity?
1. The CEO and audit committee review and endorse any changes to the approved audit plan on an annual basis.
2. The audit committee reviews the performance of the chief audit executive (CAE) periodically.
3. The internal audit charter requires the CAE to report functionally to the audit committee.
- A. 2 and 3 only
- B. 1 and 2 only
- C. 3 only
- D. 1, 2, and 3
Answer: A
NEW QUESTION # 110
The internal audit supervisor is reviewing the workpapers prepared by the staff. According to the Standards, which of the following statements regarding workpaper supervision is not true?
- A. Dating and initialing each workpaper provides evidence of review.
- B. Workpaper review allows for staff training and development.
- C. Workpapers may be amended during the review process.
- D. Review notes of questions that arise during the review process must be retained.
Answer: D
NEW QUESTION # 111
An internal auditor uses a predefined macro provided in a popular spreadsheet application to verify the present value of the organization's investments. Which of the following is the most appropriate course of action regarding the auditor's use of this functionality?
- A. The auditor should accept the calculations generated by the function, as any further work or documentation would be inefficient.
- B. The auditor should perform a manual recalculation of several results to validate and document the results.
- C. The auditor should review the programming of the macro before its use to ensure that it is appropriate for the required calculations.
- D. The auditor should tabulate the results in the spreadsheet to ensure the macro has generated the correct results for all calculations.
Answer: B
NEW QUESTION # 112
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?
- A. The internal audit activity's plan for resource allocation.
- B. The qualifications and independence of the assessment Team.
- C. The number of audits from the annual internal audit plan that were completed last year.
- D. The amount of the organization's potential loss prevented by the risk-based auditing of the internal audit activity.
Answer: D
NEW QUESTION # 113
Which of the following is an example of collusion?
- A. An employee includes a faked receipt in his expense claim, and the claim is signed by the employee's manager.
- B. A vendor inflates the price of an item and remits a portion of the excess to the purchasing manager.
- C. An employee works with the IT manager to develop a program for identifying duplicate invoice payments.
- D. A vendor sends a duplicate invoice with a new invoice number, and the accounts payable system fails to detect the duplication.
Answer: B
NEW QUESTION # 114
Which of the following statements is true regarding assurance services provided to clients outside of the organization?
- A. Assurance services for outside clients are not covered under the internal audit charter.
- B. The nature of assurance services for outside clients should be defined in the internal audit charter.
- C. Assurance services for outside clients must be approved on a case-by-case basis by the board of directors.
- D. The nature of assurance services for outside clients is the same as for internal clients.
Answer: B
NEW QUESTION # 115
An internal auditor makes a series of observations when performing an analytical review of division operations. The auditor notes the following things: the current ratio is increasing and the quick ratio is decreasing, sales and current liabilities have remained constant, and the number of day sales in inventory is increasing. Which conclusion should the auditor draw from this data?
- A. The gross margin has increased.
- B. Cash or accounts receivable has decreased.
- C. The division produced fewer items this year than in prior years.
- D. The gross margin has decreased.
Answer: B
NEW QUESTION # 116
A former line supervisor from the Financial Services Department has completed six months of a two-year development opportunity with the internal audit activity (IAA). She is assigned to a team that will audit the organization's payroll function, which is managed by the Human Resources Department. Which of the following statements is most relevant regarding her independence and objectivity with respect to the payroll audit?
- A. She may participate, because she did not previously work in the Human Resources Department.
- B. She may participate, but only after she has completed one year with the IAA.
- C. She may participate for training purposes, to build her knowledge of the IAA.
- D. She may participate, but she must be supervised by the auditor in charge.
Answer: A
NEW QUESTION # 117
Management has asked the chief audit executive (CAE) to provide assurance on the organization's automated control system related to financial data. The current audit staff does not have the expertise needed to conduct this type of engagement. Which of the following would be the best response by the CAE?
- A. Accept the assignment and use an external provider with the necessary knowledge and skills to perform the engagement.
- B. Do not accept the assignment because the internal audit activity lacks the competency to perform the engagement with due professional care.
- C. Accept the assignment if the engagement is included in the current audit plan, but inform senior management that the current audit staff does not have the knowledge and skills required.
- D. Accept the assignment and use control self-assessment to complete the project.
Answer: A
NEW QUESTION # 118
The chief audit executive (CAE) has assigned an internal auditor to an upcoming engagement. Which of the following requirements would most likely indicate that the internal auditor was assigned to an assurance engagement?
- A. The assigned internal auditor must not assume management responsibilities while performing the engagement.
- B. The assigned internal auditor must maintain objectivity while performing the engagement.
- C. The assigned internal auditor must determine the objectives, scope, and techniques of the engagement.
- D. The CAE must personally obtain the needed skills, knowledge, or other competencies if the internal auditor does not have them.
Answer: C
NEW QUESTION # 119
An internal auditor for a large retail chain suspects that a store manager has been stealing money from cash sales by listing the sales as accounts receivable and then writing off the accounts as bad debts. Which of the following irregularities is the most likely cause of the auditor's suspicion?
- A. A much higher bad debt expense as a percentage of sales than that of previous years.
- B. A much higher bad debt expense as a percentage of sales than that of other stores.
- C. A much higher percentage of past-due accounts receivable than that of previous years.
- D. A much higher percentage of past-due accounts receivable than that of other stores.
Answer: B
NEW QUESTION # 120
The chief audit executive (CAE) has been asked to manage the regulatory compliance function for the organization's retail store operations. Store operations are included in the annual audit plan.
Which of the following strategies best fulfills the requirements of the Standards regarding these audits?
- A. Store operations audits can be fully executed with appropriate disclosure to the board.
- B. A store operations compliance audit should be performed by a staff internal auditor under the direction of the CAE.
- C. Store operations audits should be performed by an external service provider.
- D. The scope of store operations audits should exclude compliance.
Answer: C
NEW QUESTION # 121
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