Free IIA IIA-ACCA Practice Questions 2026 - Page 4

A headquarters-based internal auditor has been sent to a major overseas subsidiary to conduct various engagements. Initially, the internal auditor spends time to become familiar with local customs and organization's practices while embarking on the first engagement. Which of the following competencies does the internal auditor exercise?

A. Communication.

B. Persuasion and collaboration.

C. Business acumen.

D. Governance, risk, and control.

An organization invests its savings in a volatile stock with the potential for high gains rather than a mutual fund with a lower expected return and lower volatility. This best describes which of the following risk concepts?

A. Risk identification.

B. Risk appetite.

C. Risk capacity.

D. Risk tolerance.

Evidence discovered during the course of an engagement suggests that multiple incidents of fraud have occurred. There do not appear to be sufficient controls in place to prevent reoccurrence. Which of the following is the internal auditor's most appropriate next step?

A. Immediately notify management of the area under review and the other internal auditors involved in the engagement.

B. Discuss the situation with the engagement supervisor to determine whether fraud investigation experts are required to investigate the matter properly.

C. Fully document in the workpapers the evidence that has been discovered and recommend appropriate controls to address the fraud.

D. Provide the evidence that was discovered to local law enforcement for possible prosecution of the suspected fraud.

While performing an accounts payable engagement, a senior auditor wants to conduct several tests of controls for travel expenses. Which of the following actions are most appropriate for the senior auditor to undertake?

1. Ensure all tests use a random sampling technique.
2. Consider a judgmental approach for the sample size.
3. Assess testing errors through root cause analysis.
4. Ensure that the entire data set is tested.

A. 1 and 2.

B. 1 and 3.

C. 2 and 3.

D. 2 and 4.

Which of the following professional development approaches would offer internal auditors the most opportunities to broaden their engagement experiences?

A. Assign more experienced internal auditors to mentor the less experienced auditors.

B. Send internal auditors to external trainings in advanced internal audit topics.

C. Appraise internal auditors' performance and competencies at least annually and issue constructive feedback.

D. Rotate internal auditors among different engagement assignments.

According to IIA guidance, which of the following statements is true when an internal auditor performs consulting services that improve an organization's operations?

A. The services must be aligned with those defined in the internal audit charter.

B. The services must not be performed by the same internal auditor who performed assurance services, in order to maintain objectivity.

C. The services may preclude assurance services from the consulting engagement.

D. The services impose no responsibility to communicate information other than to the engagement client.

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.

A. 4 only.

B. 1 and 2 only.

C. 3 and 4.

D. 1,2, and 3.

Which of the following best explains why integrity is a necessary personal quality for internal auditors at all levels?

A. Internal auditor integrity enables stakeholders to constantly question the work of the internal audit activity.

B. Internal auditor integrity enables the internal auditor to avoid being challenged by any party in the organization.

C. Internal auditor integrity enables the internal audit activity to be able to demonstrate independence.

D. Internal auditor integrity enables users of internal auditors' work to make important business decisions.

What is the purpose of a secondary control?

A. It replaces primary controls that are either ineffective or cannot fully mitigate a risk.

B. It partially reduces the residual risk level when a key control does not operate effectively.

C. lt combines with other controls to help reduce significant risk exposures to an acceptable level.

D. It helps to ensure the completeness and accuracy of automated controls in a system environment.

According to IIA guidance, the results of a formal quality assessment should be reported to which of the following groups?

A. The audit committee and senior management.

B. The audit committee and the external auditors.

C. Senior management and management of the audited area.

D. Senior management and the external auditors.