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IIA Certification in Risk Management Assurance Sample Questions:

1. Which of the following would be the most important consideration by the internal audit activity when selecting employees to perform an internal quality assessment?

A) Their understanding of auditing standards.
B) Previous experience working with the internal audit activity.
C) The nature of their regular duties and responsibilities.
D) Their reporting line within the organization.

2. A chief audit executive (CAE) of an international charity reports functionally to the audit committee of the board of directors and administratively to the charity's chief financial officer (CFO).
Which of the following would impair the internal audit function's independence?

A) The CFO provides feedback on the CAE's audit reports.
B) The CFO determines the scope of internal audit work in the accounting department.
C) The CFO manages the accounting of the budget for the internal audit function.
D) The CFO administers the annual evaluation process for the internal auditors.

3. A manufacturing organization discovers that the waste water released has failed to meet permitted limits.
Which control function will be least effective in correcting the issue?

A) Establishing a preventive maintenance program for the pretreatment system.
B) Performing a chemical analysis of the water, prior to discharge, for components specified in the permit.
C) Posting signs that tell employees which substances may be disposed of via sinks and floor drains within the facility.
D) Diluting pollutants by flushing sinks and floor drains daily with large volumes of clean water.

4. 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) 1.2, and 3.
D) 1.3, and 4.

5. Which of the following is a valid statement about the use of visual observations during an audit engagement?
1. Visual observations can be used to detect ineffective controls, idle resources, and safety hazards.
2. Visual observations can be used during both preliminary survey and fieldwork stages of the audit engagement.
3. Visual observations can provide unsubstantiated facts to management if the internal auditor believes the information is useful.
4. Visual observations can assist an auditor in determining if a material observation should be communicated through informal means to the organization's senior management.

A) 2 and 3 only
B) 3 and 4 only
C) 1 and 4 only
D) 1 and 2 only

Solutions: