Banking Operations Audit Flashcards
7 cards from real CBA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Banking Operations Audit flashcards as text
During an audit of wire transfer operations, an auditor discovers that a single employee can initiate, approve, and release funds. This is best described as a failure of:
Answer: Segregation of duties
Segregation of duties requires that no single individual controls all phases of a transaction to prevent fraud and errors.
A bank's teller cash drawer limit is set at $10,000. An auditor finds that several tellers regularly carry $15,000–$18,000 in their drawers. The PRIMARY audit concern is:
Answer: Violation of operational policy limits
Exceeding established drawer limits violates operational policy and exposes the bank to uncontrolled cash risk.
Which control is MOST effective at detecting kiting schemes in a bank's demand deposit operations?
Answer: Float analysis and interbank account reconciliation
Float analysis and interbank reconciliation reveal artificially inflated balances created by exploiting check clearing delays.
An auditor reviewing safe deposit box operations finds that access logs are maintained manually and have gaps. The MOST significant risk is:
Answer: Inability to detect unauthorized box access
Incomplete access logs remove the audit trail needed to detect and investigate unauthorized entry to safe deposit boxes.
Under Regulation CC, which of the following hold periods applies to a non-local check deposited by a new account holder (account opened fewer than 30 days)?
Answer: Up to 9 business days
Regulation CC allows banks to impose an exception hold of up to 9 business days for new accounts to mitigate fraud risk.
When auditing overdraft protection programs, the auditor should PRIMARILY evaluate whether the program complies with:
Answer: Regulation E opt-in requirements for ATM and one-time debit transactions
Regulation E requires banks to obtain affirmative opt-in consent before charging overdraft fees on ATM and one-time debit card transactions.
An auditor testing the bank's branch reconciliation process discovers that outstanding items older than 90 days are automatically cleared by the system without investigation. This represents a weakness in:
Answer: Stale-item management and escheatment controls
Auto-clearing unresolved outstanding items bypasses investigation requirements and may violate state escheatment laws for unclaimed property.