Which of the following is true with respect to the risk assessment process?

The ethical climate should not be included since this factor cannot be measured quantitatively.
More than one risk factor may have to be used to ensure that the risk assessment is comprehensive.
Each risk factor should be given equal weighting in order to reduce the opportunity for bias.
The risk assessment process should be conducted at least every three years.

Answer(s): B

Which of the following lists these audit steps in the correct chronological order?

Create the engagement work program.
II. Conduct the exit conference.
III. Perform fieldwork.
IV. Schedule the audit engagement.
Issue a summary report of audit findings.
I,IV,III,II,V.
I,IV,II,III,V.
IV,I,III,II,V.
IV,III,I,V,II.

Answer(s): C

Which of the following would have the least impact (either positive or negative) on an assessment of a department's control environment?

The department managed long-term investments,including investment in derivatives and other financial instruments,to maximize return.
The department manager sets a tone of honesty and integrity in all business dealings and this tone is emulated by department personnel.
Many department functions were duplicated or verified by other department employees as part of the department's normal procedures.
Audit tests designed to verify compliance with control procedures detected a general failure to follow standard procedures for transaction authorization.

Answer(s): A

To ensure that due professional care has been taken during an audit engagement, an internal auditor should always:

Ensure that all financial information related to the engagement is included in the audit plan and examined for irregularities.
Document all audit tests completely.
Consider the possibility of noncompliance or irregularities at all times during an engagement.
Notify the audit committee of any noncompliance or irregularity discovered during an engagement.

Answer(s): C

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