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QUESTION: 81

When the internal audit activity lacks the expertise to perform a specific engagement, the chief audit executive (CAE) should

Negotiate with management to remove from the scope any portion of the audit that the staff is unable to perform.
Use external resources with sufficient expertise to accomplish the engagement.
Postpone the engagement until the CAE can hire a new internal auditor with the relevant skills.
Continue with the engagement but rely on management's self-assessment in the areas where the audit staff lacks expertise.

Answer(s): B

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QUESTION: 82

Which of the following risk factors is generally the most important for an internal auditor to consider when planning an assurance engagement for a department?

The quality of the department's internal control system.
The liquidity of the department's assets.
The results of previous audit engagements for that division.
The diversification of risk in the industry.

Answer(s): A

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QUESTION: 83

Which of the following describes the activity of trading futures with the objective of reducing or controlling risk?

Insuring
Hedging.
Short-selling.
Factoring.

Answer(s): B

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QUESTION: 84

Which of the following factors should an internal auditor consider when planning an audit of an activity?

The objectives of the activity, the number of employees involved, and the control system.
The qualifications of management, the significant risks, and the control system.
The objectives of the activity, the significant risks, and the control system.
The number of employees involved, the control system, and the recommendations of external auditors.

Answer(s): C

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