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IIA-CIA-Part3 Practice Exam Questions and Answers

Business Knowledge for Internal Auditing

Last Update 2 days ago
Total Questions : 340

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Question # 1

According to IIA guidance, which of the following would be the best first stop to manage risk when a third party is overseeing the organization's network and data?

Options:

A.  

Creating a comprehensive reporting system for vendors to demonstrate their ongoing due diligence in network operations.

B.  

Drafting a strong contract that requires regular vendor control reports end a right-to-audit clause.

C.  

Applying administrative privileges to ensure right to access controls are appropriate.

D.  

Creating a standing cyber-security committee to identify and manage risks related to data security

Discussion 0
Question # 2

An organization's board of directors is particularly focused on positioning, the organization as a leader in the industry and beating the competition. Which of the following strategies offers the greatest alignment with the board's focus?

Options:

A.  

Divesting product lines expected to have negative profitability.

B.  

Increasing the diversity of strategic business units.

C.  

Increasing investment in research and development for a new product.

D.  

Relocating the organization's manufacturing to another country.

Discussion 0
Question # 3

An internal auditor is assigned to perform data analytics. Which of the following is the next step the auditor should undertake after she has ascertained the value expected from the review?

Options:

A.  

Normalize the data,

B.  

Obtain the data

C.  

Identify the risks.

Analyze the data.

Discussion 0
Question # 4

An investor has acquired an organization that has a dominant position in a mature. slew-growth Industry and consistently creates positive financial income.

Which of the following terms would the investor most likely label this investment in her portfolio?

Options:

A.  

A star

B.  

A cash cow

C.  

A question mark

D.  

A dog

Discussion 0
Question # 5

During which phase of the contracting process ere contracts drafted for a proposed business activity?

Options:

A.  

Initiation phase.

B.  

Bidding phase

C.  

Development phase

D.  

Management phase

Discussion 0
Question # 6

According to IIA guidance, which of the following best describes an adequate management (audit.) trail application control for the general ledger?

Options:

A.  

Report identifying data that is outside of system parameters

B.  

Report identifying general ledger transactions by time and individual.

C.  

Report comparing processing results with original Input

D.  

Report confirming that the general ledger data was processed without error

Discussion 0
Question # 7

A company that supplies medications to large hospitals relies heavily on subcontractors to replenish any shortages within 24 hours. Where should internal auditors look for evidence that subcontractors are held responsible for this obligation?

Options:

A.  

The company's code of ethics.

B.  

The third-party management risk register.

C.  

The signed service-level agreement.

D.  

The subcontractors' annual satisfaction survey.

Discussion 0
Question # 8

An organization has a declining inventory turnover but an Increasing gross margin rate, Which of the following statements can best explain this situation?

Options:

A.  

The organization's operating expenses are increasing.

B.  

The organization has adopted just-in-time inventory.

C.  

The organization is experiencing Inventory theft

D.  

The organization's inventory is overstated.

Discussion 0
Question # 9

Which of the following best explains the matching principle?

Options:

A.  

Revenues should be recognized when earned.

B.  

Revenue recognition is matched with cash.

C.  

Expense recognition is tied to revenue recognition.

D.  

Expenses are recognized at each accounting period.

Discussion 0
Question # 10

In accounting, which of the following statements is true regarding the terms debit and credit?

Options:

A.  

Debit indicates the right side of an account and credit the left side

B.  

Debit means an increase in an account and credit means a decrease.

C.  

Credit indicates the right side of an account and debit the left side.

D.  

Credit means an increase in an account and debit means a decrease

Discussion 0
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