Certified Internal Auditor MCQ Flashcards
7 cards from real Certified Internal Auditor practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Certified Internal Auditor MCQ flashcards as text
An internal auditor is assessing a company's enterprise risk management (ERM) program. According to COSO ERM, which component focuses on an organization's risk appetite and strategy?
Answer: Strategy and Objective-Setting
The Strategy and Objective-Setting component of COSO ERM is where risk appetite is established and aligned with strategy.
Which of the following is NOT a characteristic of a well-written audit observation (finding)?
Answer: Cost — the budget allocated for remediation
The standard elements of an audit finding are criteria, condition, cause, and effect/risk — not the remediation budget.
An auditor uses regression analysis during an engagement. This is an example of which type of audit procedure?
Answer: Analytical procedure
Regression analysis is an analytical procedure used to identify relationships and unusual variations in data.
Under the IIA Code of Ethics, which principle requires internal auditors to perform their work with honesty, diligence, and responsibility?
Answer: Integrity
The Integrity principle requires auditors to perform their work honestly, diligently, and responsibly.
During a payroll audit, an auditor wants to verify that all employees on the payroll actually exist. Which audit procedure is most appropriate?
Answer: Physically observing a payroll distribution or confirming employee identities with HR records
Physical observation or HR confirmation directly tests whether payroll employees are real, addressing ghost-employee fraud risk.
Which of the following best describes 'residual risk'?
Answer: The risk that remains after management has implemented controls to mitigate inherent risk
Residual risk is what remains after controls are applied to reduce inherent (gross) risk.
An internal audit engagement is planned for an area with high inherent risk and weak controls. How should this affect the engagement approach?
Answer: Expand the scope and increase testing depth to obtain sufficient evidence
High inherent risk combined with weak controls requires expanded scope and more rigorous testing to gather sufficient, reliable evidence.