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NEW QUESTION 26
An internal auditor finds during an engagement that payment for the organization's general insurance policy is two months overdue. The issue is informally mentioned to the finance department which immediately submits the invoice for payment. The auditor decides to exclude this finding from the final audit report as the oversight was immediately corrected and there were no consequences because of this late payment.
Which of the following rules of conduct as described in the IIA Code of Ethics, did the auditor fail to uphold?

A. Confidentiality.
B. Objectivity.
C. Competency.
D. Integrity.

Answer: B

NEW QUESTION 27
Which of the following audit techniques is used to evaluate control design while also embodying auditing's analytical process?

A. A walk-through.
B. A risk and control matrix.
C. A flowchart.
D. A process narrative.

Answer: B

NEW QUESTION 28
An internal auditor for a large retail chain suspects that a store manager has been stealing money from cash sales by listing the sales as accounts receivable and then writing off the accounts as bad debts. Which of the following irregularities is the most likely cause of the auditor's suspicion?

A. A much higher percentage of past-due accounts receivable than that of other stores.
B. A much higher bad debt expense as a percentage of sales than that of other stores.
C. A much higher percentage of past-due accounts receivable than that of previous years.
D. A much higher bad debt expense as a percentage of sales than that of previous years.

Answer: B

NEW QUESTION 29
According to IIA guidance, which of the following best describes internal auditors' responsibility regarding fraud?

A. Internal auditors must have sufficient knowledge to evaluate the risk of fraud.
B. Internal auditors should report all fraud cases to law enforcement agents, in accordance with the Code of Ethics.
C. Internal auditors should take a leading role in investigating all fraud-related cases.
D. Internal auditors are responsible for ensuring that fraud does not occur.

Answer: A

NEW QUESTION 30
Internal auditors must exercise due professional care by considering which of the following?

Cost of assurance in relation to potential benefits.
Adequacy and effectiveness of governance, risk management, and control processes.
Management's competency level in the area being evaluated.
Probability of significant errors, fraud, or noncompliance.

A. 2, 3, and 4 only
B. 1 and 2 only
C. 1, 2, and 4 only
D. 1, 2, and 3 only

Answer: C

NEW QUESTION 31
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