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| 1 | |
An internal auditor is considered independent when the internal audit department |
| | A) | Is comprised of qualified individuals. |
| | B) | Reports to an appropriate level in the company and individuals have an impartial and unbiased mental attitude. |
| | C) | Has an approved audit charter. |
| | D) | Is outsourced to a CPA firm or other qualified organization. |
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| 2 | |
Of the following:
W. Financial audits
X. Compliance audits
Y. Operational audits
Z. Governance audits
Which of these is performed by internal auditors? |
| | A) | W, X, and Y. |
| | B) | W, Y, and Z. |
| | C) | X, Y and Z |
| | D) | W, X, Y, and Z |
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| 3 | |
Internal audit standards are divided into three categories. These categories are |
| | A) | Quality, performance, and ethics. |
| | B) | Performance, operation and ethics. |
| | C) | Attribute, operation, and implementation. |
| | D) | Attribute, performance, and implementation. |
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| 4 | |
In an internal audit report the auditor must communicate the audit findings to management. To effectively communicate audit findings, the internal auditor must include in the report all of the following except |
| | A) | The condition that was identified. |
| | B) | The criteria that renders the condition inappropriate. |
| | C) | The person responsible for the condition. |
| | D) | The cause of the condition. |
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| 5 | |
An objective and systematic examination of a program against its objective criteria are known as |
| | A) | Performance audits. |
| | B) | Compliance audits. |
| | C) | Operational audit. |
| | D) | Government audit. |
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| 6 | |
When a government auditor performs a financial audit they must issue |
| | A) | An audit report on the use of tax dollars. |
| | B) | An audit report on the compliance of the entity with grant requirements. |
| | C) | A report in compliance with the Single Audit Act. |
| | D) | A report on the financial statements, a report on compliance with laws and regulations, and a report on internal controls. |
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| 7 | |
Once a fraud examiner determines that a fraud exists, the examiner must determine |
| | A) | If it is material to the financial statements. |
| | B) | If the fraud should be reported to the audit committee. |
| | C) | The scope of the fraud. |
| | D) | The appropriate law enforcement organization to notify. |
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| 8 | |
Most fraud examiners do not believe that fraud can be immaterial because |
| | A) | Most of the fraud may be hidden. |
| | B) | Fraud which is not address tends to grow. |
| | C) | Many small frauds can accumulate into considerable money. |
| | D) | All of the above. |
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| 9 | |
During an audit an auditor notes a large number of void checks in the cash disbursement account. Which of the following would most likely lead the auditor to suspect this might be a fraud? |
| | A) | The response by management to the auditor's inquiry about the void checks is that a new clerk was hired that made many errors in preparing checks. |
| | B) | The bank reconciliation should several inter-bank transfers. |
| | C) | The voided checks could not be located. |
| | D) | The cashier made deposits to the bank on a daily basis on her way home from the office. |
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| 10 | |
The application of accounting and auditing evidence to a legal problem is called |
| | A) | Fraud investigation. |
| | B) | Performance auditing. |
| | C) | Forensic accounting. |
| | D) | Judicial support. |
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