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NEW QUESTION 39
According to IIA guidance, which of the following statements regarding the internal audit charter is true?

• A. Senior management should approve the charter before it is submitted to the board.
• B. The CEO periodically should assess whether the terms of the charter continue to be adequate.
• C. The charter should describe the purpose and authority of the internal audit activity, consistent with the Standards.
• D. The charter should define the consulting services that the internal audit activity is permitted to perform.

Answer: A

NEW QUESTION 40
According to IIA guidance, which of the following scenarios demonstrates an internal auditor exercising due professional care?
When auditing investments, the auditor identified instruments with which he was unfamiliar.

• A. An auditor in charge needed to have testing completed by the end of the month, but was behind schedule. He identified a junior auditor to conduct the work for him on a complex area of the organization.
• B. He decided not to select that type of investment in his sample, as he did not have the knowledge needed to perform a proper assessment.
• C. An auditor visited a plant that produces a significant portion of the organization's inventory. The day he arrived, the plant manager was out sick, so the auditor issued the report without interviewing the manager.
• D. An auditor was reviewing inventory counts conducted by the warehouse staff. One truck containing an immaterial amount of inventory was off-site and wasn't verified by the auditor.

Answer: B

NEW QUESTION 41
Which of the following would provide the best evidence of errors in the quantities of items received from suppliers?

• A. Suppliers' reports of over shipments.
• B. Warehouse receiving logs.
• C. Observation and inspection of inventory.
• D. Purchase requisitions and purchase orders.

Answer: B

NEW QUESTION 42
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