Free CIA Exam Braindumps
Certified Internal Auditor Exam Questions 766–770 (page: 155)

Updated On: 9-Feb-2026

An evaluator is rating 100 employees on a bell curve. She is instructed to label five employees "extraordinary" and five employees "unsatisfactory." The evaluator also is instructed to label 10 employees "above average" and 10 employees "below average." All of the other employees will be in the "average" category. Which of the following is the major drawback of using this method?

  1. The process of using the method is too time consuming
  2. An employee's evaluation will depend on who the evaluator is.
  3. Different evaluators have different standards.
  4. The evaluator must place some employees in the lowest and highest tails of a bell-shaped curve.

Answer(s): D

Explanation:

The forced normal distribution method forces evaluators to label employees with ratings that fall along the normal distribution of a bell-shaped curve. The major drawback of this method is that the employees will be labeled with an evaluation regardless of their abilities. No matter what, some people will be evaluated at the bottom of the normal distribution and some people will be evaluated at the top of the II normal distribution.



An organization has a compensation system for its managers based on a management-by- objectives MBO) approach. The essential premise of MBO is that

  1. Compensation should be based on qualitative factors.
  2. Employees should be concerned with routine matters, and managers should attend to exceptions.
  3. Employees should participate in setting objectives.
  4. Managers should establish objectives for their employees.

Answer(s): C

Explanation:

MBO involves mutual setting of objectives by the superior and the subordinate as a basis for performance evaluation. Based on the Theory if philosophy that employees want to work hard if they know what is expected, MBO requires 1) senior management participation and commitment to the program, 2) integration of the objectives for all subunits into a compatible system directed toward accomplishment of organizational objectives, 3) provision for regular
reporting of performance, and 4) free and honest communication between superior and subordinates. Subordinates must make careful assessments of their abilities and their interests, and managers must "coach" subordinates rather than dictate their proper objectives. Both sides must maintain flexibility to accommodate unforeseen changes, and the review and analysis of results before setting the next round of objectives is a vital part of the process.



When faced with the problem of filling a newly created or recently vacated executive position, organizations must decide whether to promote from within or to hire an outsider. One of the disadvantages of promoting from within is that

  1. Internal promotions can have negative motivational effect on the employees of the firm.
  2. Internal promotions are more expensive to the organization than hiring an outsider.
  3. It is difficult to identify proven performers among internal candidates.
  4. Hiring an insider leads to the possibility of social inbreeding within the firm.

Answer(s): D

Explanation:

Hiring an internal candidate can lead to social inbreeding. Many firms look to external candidates for certain jobs because they bring a fresh perspective to the organization's problems and may have more up-to-date training or education.



Questions about which of the following can legally be asked in recruiting interviews?

  1. Age.
  2. Number of children.
  3. Kind of military discharge.
  4. Criminal record but only for security clearance purposes)

Answer(s): D

Explanation:

In a recruiting interview, one may not ask about the applicant's marital status, number of children, height and weight, criminal record except for the purpose of giving a security clearance), kind of military discharge, or age.



The halo effect may diminish the accuracy of the evaluation of employees. Which of the following is an example?

  1. A manager rates some employees as very good and some as very poor.
  2. A manager's judgment of one positive trait affects his/her rating of other traits.
  3. The most recent behavior overshadows overall performance.
  4. All personnel who work together are rated within the same narrow range.

Answer(s): B

Explanation:

The halo effect diminishes the accuracy of an evaluation when a manager's judgment on one positive trait affects the rating of other traits.



Viewing page 155 of 342
Viewing questions 771 - 775 out of 1702 questions


Post your Comments and Discuss IIA CIA exam prep with other Community members:

AI Tutor AI Tutor 👋 I’m here to help!