Best IIA IIA-CIA-Part2 2025 Training With 500 QA’s [Q184-Q207]

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Best IIA IIA-CIA-Part2 2025 Training With 500 QA’s

IIA IIA-CIA-Part2 Certification Exam Questions

NEW QUESTION 184
The board has asked the internal audit activity (IAA) to be involved in the organization’s enterprise risk management process. Which of the following activities is appropriate for IAA to perform without safeguards?

Coach management in responding to risks.

Develop risk management strategies for board approval.

Facilitate identification and evaluation of risks.

Evaluate risk management processes.

Section: Volume E

NEW QUESTION 185
During an engagement in one of the subsidiaries of an organization, an internal auditor noted the following in the workpapers:
“As a subsidiary of a multinational organization in this particular country, the entity is required to register annually with the respective ministry. However, the subsidiary did not submit the required documentation for registration during the prior year. Failure to comply with internal and external regulations could lead to penalties or fines from the respective authorities. It is recommended that the management of the subsidiary ensures compliance with the relevant legislation. As a recoverable action, management should register the subsidiary in the current year as soon as possible.” What part of this narrative represents a condition of the observation made by auditors in the final report?

” … the subsidiary did not submit required documentation for registration in the prior year.”

” … the entity is required to register annually with the respective ministry.”

” … failure to comply with internal and external regulations might lead to penalties or fines from the respective authorities.”

” … management should register the subsidiary in the current year as soon as possible.”

In internal auditing, the “condition” of an observation refers to the specific state or situation that has been identified during the audit. It describes what is actually occurring and provides the factual basis for the observation. In this case, the statement “… the subsidiary did not submit required documentation for registration in the prior year.” explicitly describes the observed deficiency, which is the failure to submit the necessary documentation. This condition highlights the exact issue that needs to be addressed by management.
References:
* IIA Practice Guide: “Audit Documentation”
* IIA Standard 2410: “Criteria for Communicating”

NEW QUESTION 186
An auditor is performing a review of a complex process to identify opportunities to increase efficiency. What is the most practical way to document the process to identify areas of inefficiency?

Write a description of the process activities in sequential order.

Develop a PERT (program evaluation and review technique) diagram.

Flowchart the process.

Create a decision tree.

NEW QUESTION 187
Which of the following analytical procedures should an internal auditor use to determine whether monthly expenses for the accounting department are reasonable?

Review year-over-year trending of total dollars spent in each period.

Review changes to the vendor master file for suspicious activity.

Review the percentage of on-time payments against prior periods.

Review total expenses for accounting against other department expenses in the organization.

* A. Review year-over-year trending of total dollars spent in each period:This is the correct approach because year-over-year analysis focuses on identifying anomalies or significant variances in expenses over time. Trends in data can help detect unexpected spikes, dips, or patterns that indicate irregularities or inefficiencies. This aligns with analytical procedures in expense analysis under the CIA Exam Syllabus Part 2, which emphasizes the use of comparative techniques to evaluate reasonableness.
* B. Review changes to the vendor master file for suspicious activity:While reviewing vendor master file changes is essential for fraud detection and control testing, it does not directly help in determining the reasonableness of monthly expenses.
* C. Review the percentage of on-time payments against prior periods:Examining payment timeliness relates to operational efficiency and cash flow management, not directly to evaluating whether monthly expenses are reasonable.
* D. Review total expenses for accounting against other department expenses in the organization:
Comparing accounting department expenses to those of other departments might indicate disparities but does not consider differences in department-specific activities and needs.
CIA Exam Syllabus Reference:
Domain V: Performing Internal Audit Services – Analytical Procedures and Testing Methods.

NEW QUESTION 188
—-
Risk assessments can vary in format, but generally includE.
A description of identified risks.
Tests of audit controls.
A system of rating risks.
Sample size identification.

1 and 2 only.

1 and 3 only.

1, 3, and 4 only.

2, 3, and 4 only.

NEW QUESTION 189
At the conclusion of an audit of an organization’s treasury department, a report was issued to the treasurer, chief financial officer, president, and board. Because of the sensitivity of some findings, a follow-up review was performed. The auditor should provide the report of follow-up findings to the:
I. Treasurer.
II. Chief financial officer.
III. President.
IV. Board.

I and II only

III and IV only

I, II, and III only

I, II, III, and IV.

Section: Volume B

NEW QUESTION 190
While conducting a review of the logistics department the internal audit team identified a crucial control weakness. The chief audit executive (CAE) decided to prepare an audit memorandum for management of the logistics department followed by an informal meeting What is the most likely reason the CAE decided to prepare the audit memorandum?

To obtain management’s agreement with regard to the identified weakness

To ensure that the internal audit team and the CAE are aligned with regard to the identified weakness

To report up-to-date audit progress to management

To allow management to address the identified weakness timely

NEW QUESTION 191
An internal auditor completed a review of expenses related to the launch of a new project. The auditor sampled 45 transactions approved by a senior project manager and identified 30 with questionable vendor documentation. Which of the following is the most appropriate conclusion for the auditor to include in the audit report?

The organization incurred excessive cost overruns that resulted in significant financial and legal risk to the project.

The organization experienced a potential conflict of interest

The organization had weaknesses in its review process which allowed questionable transactions with some vendors

The organization allowed the project to launch without assurance that all transactions were regularly approved

The most appropriate conclusion for the auditor to include in the audit report is that the organization had weaknesses in its review process which allowed questionable transactions with some vendors. This conclusion directly addresses the identified issue of questionable vendor documentation and implies that there are control deficiencies in the review process that need to be addressed to prevent such occurrences in the future.
Reference:
IIA Standards: 2410 – Criteria for Communicating
IIA Practice Guide: Reporting and Monitoring

NEW QUESTION 192
According to the Standards, which of the following would have the least direct interest in the draft report of a compliance review of the purchasing function?

Purchasing staff.

Purchasing manager.

Director of finance.

Audit committee.

NEW QUESTION 193
The balanced scorecard approach differs from traditional performance measurement approaches because it adds which of the following measures?
I. Financial measures.
II. Internal business process measures.
III. Client satisfaction measures.
IV.
Innovation and learning measures.

I only

II and IV only

III and IV only

II, III, and IV only

NEW QUESTION 194
An internal auditor has been assigned to facilitate a risk and control self-assessment for the finance group.
Which of the following is the most appropriate role that she should assume when facilitating the workshop?

Express an opinion on the participants’ inputs and conclusions as the assessment progresses.

Provide appropriate techniques and guidelines on how the exercise should be undertaken.

Evaluate and report on all issues that may be uncovered during the exercise.

Screen and vet participants so that the most appropriate candidates are selected to participate in the exercise.

When facilitating a risk and control self-assessment (RCSA) workshop, the internal auditor’s most appropriate role is to provide the necessary techniques and guidelines for conducting the exercise. This involves guiding participants on the methodology and framework for identifying and assessing risks and controls without influencing their inputs or conclusions, thereby ensuring an objective and effective self-assessment process.
References: = IIA Practice Guide: “Facilitation Skills for Auditors”.

NEW QUESTION 195
An internal auditor compared the number of human resources professionals per employee with industry standards. This comparison would assist the auditor in evaluating which of the following areas?

Sufficiency of controls over payroll rate increases.

Current level of performance of the human resources department.

Adequacy of controls over hiring new employees.

Degree of compliance with human resources policies.

NEW QUESTION 196
A manufacturing organization is considering a merger with a similar firm, and requests that the chief audit executive (CAE) perform a due diligence audit. During the preliminary survey, the CAE notes that inventory management is a high risk area. In consultation with the external auditors and legal advisors, the CAE learns that they share those concerns. Which of the following is the CAE’s best course of action?

Perform an independent audit of the merging firm’s inventory management practices to verify the concerns and to provide relevant and reliable results to management for their consideration and action.

Advise management that internal audit, external audit, and legal advisors all have concerns about inventory management and, given the high materiality of inventory, management should not proceed with the merger.

Coordinate a review of inventory management with external auditors and legal advisors and ensure each group focuses on their area of expertise to ascertain the extent of the problems, if any.

Coordinate with the merging firm’s internal audit department to better understand the inventory management function and whether the concerns are well-founded.

Section: Volume D

NEW QUESTION 197
An internal audit manager is supervising an engagement. A senior auditor deviates from the approved engagement plan but meets all deadlines in the approved time schedule. Which activity is not required for the audit manager to provide proper engagement supervision?

Actively participate in audit procedures.

Ensure that all engagement objectives are met.

Approve the deviation from the engagement plan.

Ensure compliance with the time schedule.

NEW QUESTION 198
Once an audit report is drafted, the auditor’s supervisor should review it primarily to ensure that all:

Statements are supported and can be authenticated.

Recommendations for corrective action are clear.

Processes within the audited area were reviewed.

Sample sizes appear appropriate for any issues found.

NEW QUESTION 199
An employee in the sales department completes a purchase requisition and forwards it to the purchaser. The purchaser places competitive bids and orders the requested items using approved purchase orders. When the employee receives the ordered items, she forwards the packing slips to the accounts payable department. The invoice for the ordered items is sent directly to the sales department, and an administrative assistant in the sales department forwards the invoices to the accounts payable department for payment. Which of the following audit steps best addresses the risk of fraud in the cash receipts process?

Verify that approvals of purchasing documents comply with the authority matrix.

Observe whether the purchase orders are sequentially numbered.

Examine whether the sales department supervisor approves invoices for payment.

Determine whether the accounts payable department reconciles all purchasing documents prior to payment.

Section: Volume E

NEW QUESTION 200
Acceding to MA guidance, when of the Mowing strategies would like provide the most assurance to the chief audit executive (CAE) that the internal audit activity’s recommendations are being acted upon?

The CAF obtains a formal response from senior management regarding the corrective actions they plan to take w address the recommendations.

The CAE develops a tracking system to monitor the stains of engagement recommendations reported to management for action

The CAE communicates with impacted department managers to determine whether corrective actions have addressed engagement recommendations

The CAE works with the engagement supervisor to monitor the recommendations issued to management for corrective action

NEW QUESTION 201
Which of the following statements describes an engagement planning best practice?

It is best to determine planning activities on a case-by-case basis because they can vary widely from engagement to engagement.

If the engagement subject matter is not unique, it is not necessary to outline specific testing procedures during the planning phase.

The engagement plan includes the expected distribution of the audit results, which should be kept confidential until the audit report is final.

Engagement planning activities include setting engagement objectives that align with audit client’s business objectives.

Section: Volume E

NEW QUESTION 202
According to IIA guidance, which of the following procedures would be least effective in managing the risk of payroll fraud?

The employee’s name listed on organization’s payroll is compared to the personnel records.

Payroll time sheets are reviewed and approved by the timekeeper before processing.

Employee access to the payroll database is deactivated immediately upon termination.

Changes to payroll are validated by the personnel department before being processed.

NEW QUESTION 203
When establishing a quality assurance and improvement program, the chief audit executive should ensure the program is designed to accomplish which of the following objectives?
1. Add value.
2. Improve operations.
3. Provide assurance that the internal audit activity conforms with the Standards.
4. Provide assurance that the internal audit activity conforms with the IIA Code of Ethics.

1 only

1 and 2 only

1 and 3 only

1, 2, 3, and 4

Section: Volume E

NEW QUESTION 204
Which of the following tasks would be considered unusual for planning a control self-assessment workshop?

Conducting interviews to identify relevant issues for the discussion.

Identifying key stakeholders and ensuring they are represented in the group.

Securing an external subject matter expert to arbitrate disputes.

Ensuring that managers are willing to accept constructive criticism.

NEW QUESTION 205
An organization decides to create an internal audit function and hires a new chief audit
executive (CAE). Which of the following should the CAE first consider when developing the internal audit process?

Requirements of the external auditors to ensure an efficient coordination of audit effort.

Sufficient resources to adequately meet the needs of the annual audit plan.

Alignment of internal audit objectives with the organization’s strategic plan.

An appropriate training plan for audit staff.

NEW QUESTION 206
According to the International Professional Practices Framework, the responsibility for establishing and maintaining a system to monitor the disposition of results communicated to management falls upon:

Compliance officer.

Chief audit executive.

Senior management.

Risk manager.

NEW QUESTION 207
Which of the following constitutes supervisory activity undertaken during the planning phase of an assurance engagement?

Ensuring the process owner with the engagement objectives

Reviewing engagement draft reports

Ensuring workpapers support audit findings

Approving audit work programs

During the planning phase of an assurance engagement, one of the key supervisory activities is approving the audit work programs. This step ensures that the planned procedures are appropriate for achieving the engagement objectives and that the audit scope is adequately covered. Supervisory activities like ensuring alignment with engagement objectives, reviewing draft reports, and ensuring workpapers support findings typically occur during the fieldwork or reporting phases. Approving the audit work programs at the planning stage helps to ensure that the engagement is well-directed and thorough.References:
* The Institute of Internal Auditors (IIA) – Standards for the Professional Practice of Internal Auditing, Standard 2200 – Engagement Planning

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