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IIA IIA-CIA-Part3-3P Exam Sample Questions

Question # 1

During an audit of the organization's annual financial statements, the internal auditor notes that the current cost of goods sold percentage is substantially higher than in prior years. Which of the following is the most likely explanation for this increase?

A. Cost of raw material inventory items is decreasing.

B. Process to manufacture goods is more efficient.

C. Labor productivity to produce goods is increasing.

D. Write-off of inventory is increasing.

Answer

D. Write-off of inventory is increasing.

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Question # 2

Which of the following activities most significantly increases the risk that a bank will make poor-quality loans to its customers?

A. Borrowers may not sign all required mortgage loan documentation.

B. Fees paid by the borrower at the time of the loan may not be deposited in a timely manner.

C. The bank's loan documentation may not meet the government's disclosure requirements.

D. Loan officers may override the lending criteria established by senior management.

Answer

D. Loan officers may override the lending criteria established by senior management.

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Question # 3

Which of the following purchasing scenarios would gain the greatest benefit from implementing electronic data interchange?

A. A time-sensitive just-in-time purchase environment.

B. A large volume of custom purchases.

C. A variable volume sensitive to material cost.

D. A currently inefficient purchasing process.

Answer

A. A time-sensitive just-in-time purchase environment.

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Question # 4

In creating a risk-based plan, which of the following best describes a top-down approach to understanding business processes?

A. Identifying the processes at the activity level.

B. Analyzing the organization's strategic plan where the business processes are defined.

C. Analyzing the organization's objectives and identifying the processes needed to achieve the objectives.

D. Identifying the risks affecting the organization, the objectives, and then the processes concerned.

Answer

C. Analyzing the organization's objectives and identifying the processes needed to achieve the objectives.

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Question # 5

An organization's balance sheet indicates that the total asset amount and the total capital stock amount remained unchanged from one year to the next, and no dividends were declared or paid. However, the organization reported a loss of $200,000. Which of the following describes the most likely year-over-year change to the organization's total liabilities and total stockholder equity?

A. The total liabilities and total stockholder equity both increased.

B. The total liabilities and total stockholder equity both decreased.

C. The total liabilities decreased, and the total stockholder equity increased.

D. The total liabilities increased, and the total stockholder equity decreased.

Answer

D. The total liabilities increased, and the total stockholder equity decreased.

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