Chapt 2 P2

Question 1

Internal auditors must exercise professional due care by during an assurance engagement by considering:

Answer 1

• Extent of work need to achieve the engagement’s objectives
• Relative complexity, materiality, or significance of matters to which assurance procedures are applied
• Adequacy and effectiveness of governance, risk management and control processes
• Probability of significant error
• Cost of assurance in relation to potential benefit

Question 2

Internal auditors must exercise due professional care during a consulting engagement by considering:

Answer 2

• Needs and expectations of clients, including the nature, timing, and communication of engagement results
• Relative complexity and extent of work needed to achieve the engagement’s objectives
• Cost of the consulting engagement in relation to the potential benefits

Question 3

Practicing and non-practicing CIA’s must complete how many hours of CPE annually?

Answer 3

40 hours for practicing and 20 for non practicing with at least 2 hours of ethics training

Question 4

Qualifying CPE activities include:

Answer 4

• Educational programs
• Passing exams
• Authoring or contributing to publications
• Translating publications
• Delivering oral presentations
• Participating as a subject matter expert volunteer
• Performing external quality assessments

Question 5

A quality assurance and improvement program is designed to evaluate the internal audit activity’s conformance with:

Answer 5

• The standards
• application of Code of Ethics
• efficiency and effectiveness of internal audit activity
• identified opportunities for improvement.

Question 6

Internal assessment of a QA process consists of:

Answer 6

• Ongoing monitoring
• periodic self-assessments which evaluate conformance to IPPF
• quality and supervision of audit work performed,
• adequacy of internal audit procedures,
• the value added to the organization
• establishment and achievement of key performance metrics.

Question 7

Which are the 5 components of a QAIP:

Answer 7

Internal assessment
external assessment
communication of results
proper use of conformance statement
disclosure of non-conformance.

Question 8

Ongoing monitoring is primarily achieved through continuous achievement such as

Answer 8

engagement planning and supervision
standardized work practices
workpaper procedures and sign off
report reviews, 
identifying weaknesses or areas that need improvement

Question 9

External assessment provide an opportunity for (a)n ______________and is performed once every _____.

Answer 9

independent assessor or assessment team to conclude on the internal audit activity’s conformance to the standards and code of ethics.

5 years.

Question 10

The internal audit activity conducts periodic self-assessments to validate its continued conformance with the standards and Code of Ethics and to evaluate:

Answer 10

• The quality and supervision of work performed
• The adequacy and appropriateness of internal audit policies and procedures
• The ways in which internal audit adds value
• The achievement of key performance indicators
• The degree to which stakeholders expectations are met.

Question 11

The scope of a full external assessment typically includes which three core components:

Answer 11

1) level of conformance to the standards and Code of Ethics
2) Efficiency and effectiveness of internal audit activity
3) Extent to which internal audit activity meets expectations of the board and senior management and operations management, and adds value to the organization.

Question 12

How does and external assessor evaluate the internal audit activities conformance to the Standards and Code of Ethics?

Answer 12

by reviewing the internal audit activities charter, plans, policies and procedures, and practices. May include applicable legislative and regulatory requirements.

Question 13

How dos the external assessor evaluate the internal audit activities efficiency and effectiveness?

Answer 13

by measuring through an assessment of the internal audit activity’s processes and infrastructure, including the QAIP, and an evaluation of the internal audit staff’s knowledge, experience, and expertise.

Question 14

To demonstrate conformance to the Code of Ethics and Standards, how often are the results of the external and periodic internal assessments communicated,

Answer 14

External and periodic internal assessments are communicated upon completion of such assessments board and senior management.

Question 15

How often are the results of ongoing monitoring communicated?

Answer 15

Ongoing monitoring results are communicated at least annually to the board and senior management.