IIA-CIA-Part1 Exam Practice Test Instant Access

Question 1

The level of authority for the internal audit activity is granted by which of the following?

AThe chief audit executive.

BThe internal audit charter.

CThe International Professional Practices Framework.

DThe IIA's Code of Ethics.

Answer : B

The internal audit charter formally grants the internal audit activity its authority, as per IIA standards. It outlines the audit function's scope, responsibilities, and independence within the organization.

Question 2

An internal audit activity is performing a governance engagement. Which of the following would provide the best evidence for an internal auditor when evaluating the organization's culture?

APersonnel and customer surveys, actual reports, and due diligence results regarding third-party governance practices.

BDetails on mandatory reporting to third parties, disclosure committee charter and responsibilities, and the internal communication system.

CSuccession plans, development programs, and job descriptions with responsibilities and authorities.

DEthics and integrity policy; structured interviews with employees; and established and communicated values, mission, and vision.

Answer : D

Evaluating organizational culture requires insights into ethics, values, and behavior. The combination of the ethics policy, structured employee interviews, and communicated organizational values provides a comprehensive view, as recommended by IIA standards for governance audits.

Question 3

Which of the following is the primary benefit of establishing a formal training program for the internal audit activity?

AIt is useful to reinforce the independence of the internal audit activity.

BIt is useful to guide internal auditors as they perform specific engagements.

CIt is useful to maintain the skills and competencies of internal audit staff.

DIt is useful to measure the effectiveness and maturity of the internal audit activity.

Answer : C

A formal training program is essential for maintaining and enhancing the skills and competencies of internal audit staff. IIA guidance encourages continuous learning to ensure auditors remain proficient and up-to-date with auditing standards and practices.

Question 4

Which of the following is most likely to result in the impairment of independence for the internal audit activity?

AThe chief audit executive (CAE) has a dual reporting relationship within the organization.

BThe CAE performs an audit of a functional area that is also under the CAE's oversight.

CThe CAE has unrestricted access to information throughout the organization and to the board.

DThe board is involved in decisions to hire or remove the CAE and in drafting and approving an internal audit charter.

Answer : B

IIA standards state that independence is impaired if a CAE audits an area over which they have oversight responsibilities, as this creates a conflict of interest. The CAE's dual role compromises objectivity, a key requirement for effective internal auditing.

Question 5

According to IIA guidance, which of the following is an appropriate role for the internal audit activity?

ACoaching management in responding to risks.

BImplementing risk responses on management's behalf.

CImposing risk management processes.

DSetting the risk appetite.

Answer : A

The IIA's guidelines suggest that internal audit may provide support by coaching management on risk responses, but it should not take on management's responsibilities, such as implementing risk responses or setting the risk appetite, as this would impair objectivity.

Question 6

Which of the following is an appropriate role for the internal audit activity?

AEnsuring the organization's key risks are managed through appropriate controls.

BAssisting the organization in maintaining effective controls.

CImplementing new controls to promote continuous improvement.

DValidating control assessments performed by the external auditor.

Answer : B

According to IIA standards, the internal audit activity should assist in maintaining effective controls but should not assume management's responsibilities, such as implementing or ensuring controls, to preserve its independence.

Question 7

An internal auditor in a newly established internal audit activity identifies many control weaknesses and raises a number of high-priority recommendations in her first few audit engagements. The internal auditor is concerned that there seems to be a poor understanding by management of risk and control. Which of the following is the most likely reason for this?

APoor performance by individual operational managers in the areas audited.

BUnrealistic expectations by the internal audit activity on the quality of risk management and control.

CA lack of an effective organizational framework for risk management and control.

DA failure by the internal audit activity to identify and manage the organization's risks.

Answer : C

The identification of multiple control weaknesses and high-priority recommendations often indicates a systemic issue with the organizational framework for risk management. A strong organizational framework provides guidance on risk management and controls, aligning with IIA guidelines on the importance of an integrated approach to risk management.

IIA-CIA-Part1 Certified Internal Auditor Exam Practice Test