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NEW QUESTION 54
An organization's policies allow buyers to authorize expenditures up to $50,000 without any other approval. Which of the following audit procedures would be most effective in determining if fraud in the form of payments to fictitious companies has occurred?

  • A. Use generalized audit software to list all purchases over $50,000 to determine whether they were properly approved.
  • B. Use generalized audit software to take a random sample of all expenditures under $50,000 to determine whether they were properly approved.
  • C. Use generalized audit software to select a sample of paid invoices to new vendors and examine evidence that shows that services or goods were received.
  • D. Develop a snapshot technique to trace all transactions by suspected buyers.

Answer: C

 

NEW QUESTION 55
Which of the following is correct with respect to roles within an enterprise-wide risk management process?
1. The board provides oversight to the risk management process.
2. Executive management owns the risk management framework.
3. Senior management is assigned ownership of risks.
4. Internal audit modifies the risk assessment determined by management.

  • A. 1, 2, 3, and 4
  • B. 3 and 4 only
  • C. 1, 2, and 3 only
  • D. 1 and 2 only

Answer: C

Explanation:
Section: Volume D

 

NEW QUESTION 56
An organization has acquired a new line of business. None of the organization's internal auditors have the required expertise to perform an internal audit of the new business line; therefore, the chief audit executive (CAE) has contracted the services of an external audit firm to perform the engagement. The CAE has assigned a member of the internal audit team to assist the external team with the engagement. According to the Standards, which of the following statements is true regarding supervision of the engagement?

  • A. The CAE is not responsible for the quality of an audit performed by an external firm.
  • B. The CAE may rely upon the external firm's auditor in charge to supervise the engagement.
  • C. The external firm's auditor in charge must defer to the judgment of the CAE for any disputes.
  • D. The CAE should not assign an inexperienced staff member to assist with the engagement.

Answer: C

 

NEW QUESTION 57
When conducting a performance appraisal of an internal auditor who has been a below-average performer, it is not appropriate to:

  • A. Use objective, impartial language.
  • B. Notify the internal auditor of the upcoming appraisal several days in advance.
  • C. Use generalizations.
  • D. Document the appraisal.

Answer: C

 

NEW QUESTION 58
White planning an audit engagement of a procurement card activity. which of the following actions should an internal auditor take to denary relevant risks and controls?

  • A. Compare card transaction types against procurement card policy guidelines.
  • B. Develop the scope and objectives of the engagement
  • C. Meet with the procurement card program administrator
  • D. Determine how many cardholders exceeded their daily limit.

Answer: C

 

NEW QUESTION 59
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