Free IIA IIA-ACCA Practice Questions 2026 - Page 15

An auditor identifies three errors in the sample of 25 entries selected for review (a 12 percent error rate). Based on this result, the auditor assumes that approximately 59 of the total population of 492 entries are incorrect. To reach this assumption, the auditor has used a technique known as which of the following?

A. Variability tolerance.

B. Ratio estimation.

C. Stratification.

D. Acceptance sampling.

Which of the following describes a key characteristic related to effective organizational communication?

A. Comprehensive supervisory and verification procedures.

B. A well-designed system of internal controls.

C. A culture of integrity and transparency.

D. Unique operating environments with varying complexity.

During an audit engagement, the internal auditor discussed a risk mitigation recommendation with the manager of the area under review. The manager disagreed with the risk assessment and recommendation. The two failed to come up with an alternative solution, and the auditor decided to proceed with including the original recommendation in the engagement report. Which of the following is especially important in dealing with this type of situation?

A. Soft skills in communication, negotiation, and collaboration.

B. Technical skills in the area under review.

C. Professional qualifications and certification in internal auditing.

D. Confidentiality and independence.

A manufacturing line supervisor joins the internal audit activity for a two-year rotational job assignment and is assigned to an accounts receivable audit. With regard to this assignment, which of the following should be the primary concern of the audit manager?

A. Due professional care.

B. Individual independence.

C. Individual objectivity.

D. Organizational independence.

Faced with a complex, highly technical construction audit engagement, the chief audit executive (CAE) considered complementing the current internal audit resources by engaging the services of a civil engineer.
Which of the following should the CAE consider in determining whether the engineer possesses the necessary skills to perform the engagement?

1. Professional certification, license, or other recognition of the engineer's competence in the relevant discipline.
2. Experience of the engineer in the type of work being considered.
3. Compensation or other incentives that the engineer may receive.
4. The extent of other ongoing services that the engineer may be performing for the organization.

A. 1 and 4 only

B. 2 and 3 only

C. 3 and 4 only

D. 1, 2, and 4 only

Which of the following is most likely to enhance an internal auditor's objectivity?

A. An auditor is appropriately able to communicate results.

B. An auditor performs his work free from interference.

C. An auditor is unrestricted in determination of scope.

D. An auditor avoids conflicts of interest.

According to IIA guidance, which of the following must the internal auditor consider to meet the requirements for due professional care?

A. The training courses necessary to enhance the internal auditor's knowledge, skills, and other competencies.

B. The appropriateness of assurance procedures necessary to ensure all significant risks will be identified.

C. The use of innovative technology and data analysis techniques.

D. The extent of work needed to achieve the engagement’s objectives.

When auditing the award of a major contract, which of the following should an internal auditor suspect as a red flag for a bidding fraud scheme?

1. Subsequent change orders increase requirements for low-bid items.
2. Material contract requirements are different on the actual contract than on the request for bids.
3. A high percentage of employees are charged to indirect accounts.
4. Losing bidders are hired as subcontractors.

A. 1 only

B. 2 only

C. 1 and 3.

D. 2 and 4.

Given the highly technical and legal nature of privacy issues, which of the following statements best describes the internal audit activity's responsibility with regard to assessing an organization's privacy framework?

A. If an organization does not have a mature privacy framework, the internal audit activity should assist in developing and implementing an appropriate privacy framework.

B. Because the audit committee is ultimately responsible for ensuring that appropriate control processes are in place to mitigate risks associated with personal information, the internal audit activity is C. required to conduct privacy assessments.

C. The internal audit activity may delegate to nonaudit IT specialists the responsibility of determining whether personal information has been secured adequately and data protection controls are sufficient.

D. The internal audit activity should have appropriate knowledge and competence to conduct an asses .......framework.

According to IIA guidance, which of the following are considerations of due professional care when an internal auditor conducts a formal consulting engagement?

1. The complexity of the work required.
2. The needs and expectations of the client.
3. The potential value of the engagement compared to the effort.
4. Information regarding assumptions and procedures to be employed.

A. 1 and 4 only

B. 2 and 3 only

C. 1, 2, and 3 only

D. 1, 2, 3, and 4