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NEW QUESTION 35
If observed during fieldwork by an internal auditor, which of the following activities is least important to communicate formally to the chief audit executive?

• A. Acts that conceal inappropriate activities in the organization.
• B. Acts that damage or have an adverse effect on the environment.
• C. Acts that favor one party to the detriment of another.
• D. Acts that may endanger the health or safety of individuals.

Answer: C

Explanation:
Section: Volume E

NEW QUESTION 36
When setting the scope for the identification and assessment of key risks and controls in a process, which of the following would be the least appropriate approach?

• A. Ensure the audit includes an assessment of manual and automated controls to determine whether business risks are effectively managed.
• B. Specify that the auditors need to assess only key controls, but may include an assessment of non-key controls if there is value to the business in providing such assurance.
• C. Develop the scope of the audit to include controls that are necessary to manage risk associated with a critical business objective.
• D. Develop the scope of the audit based on a bottom-up perspective to ensure that all business objectives are considered.

Answer: D

NEW QUESTION 37
In which of the following populations would the internal auditor most likely choose to use a stratified sampling approach?

• A. Tax reports submitted to meet the requirements of the local taxation authority
• B. Inventory comprised of the same items stored in different warehouses
• C. Revenue that is earned by an organization through cash receipts or as receivable.
• D. Batches of materials that must be confirmed as meeting quality standards

Answer: C

NEW QUESTION 38
An audit observation noted that annual inventory counts of biofuel was not being performed appropriately Fuel yards were not visited and physical amounts of biofuel were not reconciled with accounting data Management of the division understood the issue and promised to resolve the problem When should the internal auditor schedule a follow-up review?

• A. When management has indicated that the issue has been resolved
• B. As soon as possible, no later than two months after the audit
• C. Before financial year end
• D. When convenient for both parties

Answer: A

NEW QUESTION 39
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