QUESTION: 125

According to IIA guidance, which of the following scenarios demonstrates an internal auditor exercising due professional care?
When auditing investments, the auditor identified instruments with which he was unfamiliar. He decided not to select that type of investment in his sample, as he did not have the knowledge needed to

perform a proper assessment.
An auditor was reviewing inventory counts conducted by the warehouse staff. One truck containing an immaterial amount of inventory was off-site and wasn't verified by the auditor.
An auditor visited a plant that produces a significant portion of the organization's inventory. The day he arrived, the plant manager was out sick, so the auditor issued the report without interviewing the manager.
An auditor in charge needed to have testing completed by the end of the month, but was behind schedule. He identified a junior auditor to conduct the work for him on a complex area of the organization.

Answer(s): A

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QUESTION: 126

Which of the following activities should the chief audit executive perform to ensure compliance with an organization's code of conduct?

Act as an adviser to the committee responsible for reviewing violations of the code.
Review and adjudicate all violations of the code of conduct.
Lead the committee responsible for the oversight of the code.
Implement a system of procedures to inform all employees of the code.

Answer(s): A

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QUESTION: 127

According to IIA guidance, when preparing the charter for the internal audit activity, the chief audit executive (CAE), board, and senior management should agree on which of the following?
1. The standards to be used by the internal audit activity.
2. The internal audit activity's code of ethics.
3. The CAE's reporting line.
4. The internal audit activity's responsibilities.

4 only.
1 and 2 only.
3 and 4.
1,2, and 3.

Answer(s): C

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QUESTION: 128

Which of the following would be the most important consideration by the internal audit activity when selecting employees to perform an internal quality assessment?

Their understanding of auditing standards.
Previous experience working with the internal audit activity.
Their reporting line within the organization.
The nature of their regular duties and responsibilities.

Answer(s): A

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QUESTION: 128