5/17/2021 Fourth and Final Examination: MCQ Exam: Attempt review

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Started on Monday, May 17, 2021, 6:00 PM

State Finished
Completed on Monday, May 17, 2021, 7:59 PM
Time taken 1 hour 59 mins
Grade 60.00 out of 60.00 (100%)

Question 1
Correct Mark 1.00 out of 1.00

A control standard that covers security and control for IT system in support of business
processes and is designated for management, users and auditors are defines as

a. SRSA
b. COSO
c. COBIT 
d. ERM

The correct answer is: COBIT

Question 2
Correct Mark 1.00 out of 1.00

A device that involves the accumulation and dissemination of all those documents,
guidance, directions and instructions issued by audit management that affect the way the
audit service is delivered.

a. Audit Report
b. Audit Plan
c. Audit Manual 

d. Audit Strategy

The correct answer is: Audit Manual

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Question 3
Correct Mark 1.00 out of 1.00

A dynamic process for taking all reasonable steps to find out and deal with the risk that
impact on our objectives

a. Control Environment
b. Risk management 
c. Board
d. Management

The correct answer is: Risk management

Question 4
Correct Mark 1.00 out of 1.00

A false accounting which is a criminal offense

a. Concealment 
b. Motive
c. Means
d. Opportunities

The correct answer is: Concealment

Question 5
Correct Mark 1.00 out of 1.00

A pivotal role and accountable to stakeholders.

a. The Shareholders & Stakeholders

b. The Chief Audit Executive
c. The Board of Directors 
d. The Management

The correct answer is: The Board of Directors

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Question 6
Correct Mark 1.00 out of 1.00

A tool used businesses to promote risk management in teams, projects, through processes
and generally throughout the organizational.

a. Safeguard of Asset
b. Control Environment
c. Control Risk Self-Assessment 
d. Enterprises –Wide Risk Management

The correct answer is: Control Risk Self-Assessment

Question 7
Correct Mark 1.00 out of 1.00

All of the following are internal audit activity except.

a. Effectiveness and Efficiency of Operations

b. Reliability and Integrity of Financial Operation and Information
c. Safeguarding of Assets
d. Sound Risk Management 

The correct answer is: Sound Risk Management

Question 8
Correct Mark 1.00 out of 1.00

All of the following are objectives of audit report, except

a. To recommend change.
b. To provide an insight for management into risk and control issues.
c. To protect third-parties. 
d. To secure action in response to audit advice.

The correct answer is: To protect third-parties.

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Question 9
Correct Mark 1.00 out of 1.00

Any action taken by management, the board and other parties to manage risk and increase
the likelihood that established objectives and goals will be achieved

a. Control Environment
b. Internal Control 
c. Control Risk Self-Assessment
d. Internal Audit

The correct answer is: Internal Control

Question 10
Correct Mark 1.00 out of 1.00

Any illegal act characterized by deceit, concealment or violation of trust

a. Theft
b. Fraud 
c. Motive
d. Illegal act

The correct answer is: Fraud

Question 11
Correct Mark 1.00 out of 1.00

Arrangements and procedure in place to ensure the business objectives may be met

a. Control Environment
b. Internal Control
c. Risk Management
d. Control Mechanism 

The correct answer is: Control Mechanism

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Question 12
Correct Mark 1.00 out of 1.00

Client kept informed is part of the:

a. Internal Control
b. Audit Planning
c. Risk Assessment
d. Audit Reporting Process 

The correct answer is: Audit Reporting Process

Question 13
Correct Mark 1.00 out of 1.00

Communications are free from errors and distortions and are faithful to the underlying
facts

a. Constructive Communication
b. Concise Communication
c. Accurate Communication 
d. Objective Communication

The correct answer is: Accurate Communication

Question 14
Correct Mark 1.00 out of 1.00

In an audit reporting process which of the following should come first

a. Preliminary survey and assignment plan 

b. Agreed action plan

c. Clear audit objectives
d. Clear well-written drafts

The correct answer is: Preliminary survey and assignment plan

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Question 15
Correct Mark 1.00 out of 1.00

Is a formal document that defines the internal audit activity’s purpose, authority, and
responsibility?

a. Engagement Letter
b. Code of Ethics
c. Definition of Internal Auditing
d. Internal Audit Charter 

The correct answer is: Internal Audit Charter

Question 16
Correct Mark 1.00 out of 1.00

Is titled to aid an organizational mission as well as a guide to what the company stands for
and will uphold to its consumers.

a. Corporate Social Responsibility 

b. Whistleblowing
c. Corporate Governance
d. Ethical Reporting

The correct answer is: Corporate Social Responsibility

Question 17
Correct Mark 1.00 out of 1.00

It is a type of tests that involves taking a small sample of items that are traced through the
system to ensure that the auditor understands the system.

a. Compliance
b. Substantive
c. Walk-through 
d. Dual Purpose

The correct answer is: Walk-through

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Question 18
Correct Mark 1.00 out of 1.00

It is an audit planning approach which focuses on the strategic, regulatory, financial, and
business risks to which an organization has exposure.

a. Traditional Audit Planning

b. Risk-Based Planning 
c. Transaction-Based Planning
d. Corporate Governance-Based Planning

The correct answer is: Risk-Based Planning

Question 19
Correct Mark 1.00 out of 1.00

It is an unbiased mental attitude that allows internal auditors to perform engagements in

such a manner that they believe in their work product and that no quality compromises are
made.

a. Competence
b. Objectivity 
c. Independence
d. Confidentiality

The correct answer is: Objectivity

Question 20
Correct Mark 1.00 out of 1.00

It is the act of securing suitable evidence to support an audit.

a. Reporting
b. Sampling
c. Testing 
d. Planning

The correct answer is: Testing

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Question 21
Correct Mark 1.00 out of 1.00

It is the extent that managers and board member have identified, evaluated and managed
the company risk

a. Monitor
b. Review 
c. Identify
d. Strategic

The correct answer is: Review

Question 22
Correct Mark 1.00 out of 1.00

It is the fundamental end product of any audit, and the auditor’s opportunity to get
management’s undivided attention.

a. Audit Planning
b. Audit Report 
c. Audit Documentation
d. Control framework

The correct answer is: Audit Report

Question 23
Correct Mark 1.00 out of 1.00

Obtaining property by deception and false accounting

a. Conspiracy
b. Forgery
c. Bribery
d. Theft 

The correct answer is: Theft

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Question 24
Correct Mark 1.00 out of 1.00

Organizational independence is effectively achieved when the chief audit executive reports
functionally to the board. The following are examples of functional reporting to the board
involve board except

a. Reviewing the reliability and integrity of financial information and the means used to collect and report 
such information.
b. Approving the internal audit charter
c. Approving the risk based internal audit plan
d. Receiving communications from the chief audit executive on the internal audit activity’s performance relative to
its plan and other matters

The correct answer is: Reviewing the reliability and integrity of financial information and the means used to collect
and report such information.

Question 25
Correct Mark 1.00 out of 1.00

Reviewing fraud prevention and detection processes put in place by management

a. Staff
b. Management
c. Board
d. Internal audit 

The correct answer is: Internal audit

Question 26
Correct Mark 1.00 out of 1.00

Set the tone from the top by having a policy that fraud will not be tolerated and fraudster
will be prosecuted

a. Audit committee
b. Management 

c. Internal audit executive

d. Senior officer

The correct answer is: Management

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Question 27
Correct Mark 1.00 out of 1.00

Someone may wish to defraud an organization and know exactly what is to be gained, but
with no opportunity it may never occur, is known as

a. Reason
b. Motive
c. Attraction
d. Opportunities 

The correct answer is: Opportunities

Question 28
Correct Mark 1.00 out of 1.00

Statement 1: The Attribute Standards address the characteristics of organizations and

parties performing internal audit activities; Statement 2: The Performance Standards
describe the nature of internal audit activities and provide quality criteria against which the
performance of these services can be evaluated

a. False, False
b. True, False
c. False, True
d. True, True 

The correct answer is: True, True

Question 29
Correct Mark 1.00 out of 1.00

Statement 1: Audit report assures the management that business risks are well controlled;
Statement 2: Audit report does not support action plans prepared by client management.

a. False; True
b. True; False 
c. False; False
d. True; True

The correct answer is: True; False

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Question 30
Correct Mark 1.00 out of 1.00

Statement 1: Bribery is false instrument with the intention that he or another shall not use
it to induce someone to accept it as a genuine and by reason of accepting it; Statement 2:
Theft refers to any money, gift or consideration paid or received as an inducement or
reward for favour or request from an authority.

a. False, False 
b. False, True
c. True, False
d. True, True

The correct answer is: False, False

Question 31
Correct Mark 1.00 out of 1.00

Statement 1: Control refers to the uncertainty of outcome within a range of exposures

arising from a combination of the impact and probability of potential events; Statement 2:
Corporate governance refers to the uncertainty of an event not occurring that could have an
impact on the achievement of objectives.

a. False, False 
b. True, False
c. False, True
d. True, True

The correct answer is: False, False

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Question 32
Correct Mark 1.00 out of 1.00

Statement 1: Corporate governance framework is there to encourage the efficient use of

resources and equally to require accountability for the stewardship of those resources;
Statement 2: Corporate Governance is concerned with holding the balance between
economic and social goals and between individual and communal goals.

a. True, True 
b. False, False
c. True, False
d. False, True

The correct answer is: True, True

Question 33
Correct Mark 1.00 out of 1.00

Statement 1: During audit planning, the management should review all relevant
information such as risk models/risk analysis, audit plans, audit assignments, and activity
reports; Statement 2: The chief audit executive should provide written policies and
procedures to guide the audit staff.

a. True ; True
b. False ; True 
c. True ; False
d. False ; False

The correct answer is: False ; True

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Question 34
Correct Mark 1.00 out of 1.00

Statement 1: Engagement working papers generally support the accuracy and completeness
of the work performed; Statement 2: Working papers should be signed by the management
and the board.

a. False; False
b. False; True
c. True; False 
d. True; True

The correct answer is: True; False

Question 35
Correct Mark 1.00 out of 1.00

Statement 1: Internal Auditing Standards are fundamental principles and procedures that
make internal auditing a unique, disciplines and systematic activity; Statement 2: The
purpose of Internal Auditing Standards is to delineate basic principles that represent the
practice of internal auditing as it should be.

a. True, False
b. True, True 
c. False, True
d. False, False

The correct answer is: True, True

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Question 36
Correct Mark 1.00 out of 1.00

Statement 1: The chief audit executive should not discuss the Definition of Internal
Auditing, the Code of Ethics, and the Standards with senior management and the board;
Statement 2: The chief audit executive must report to a level within the organization that
allows the internal audit activity to fulfil its responsibilities

a. True, False
b. False, False
c. True, True
d. False, True 

The correct answer is: False, True

Question 37
Correct Mark 1.00 out of 1.00

Statement 1: The IA department accomplishes its purpose of assisting management by

reviewing, examining, and evaluating activities, furnishing analyses and appraisals, and
reporting findings and recommendations; Statement 2-The IA department also has the
responsibility to perform audit work with due professional care and with appropriate
education, experience, certification, professional image and attitude, and personal
integrity.

a. True, False
b. True, True 
c. False, True
d. False, False

The correct answer is: True, True

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Question 38
Correct Mark 1.00 out of 1.00

Statement 1: The IA department will have limited and restricted access to records,
personnel, and physical properties relevant to the performance of an audit; Statement 2-
Audit director should have indirect access to the audit committee since it tends to enhance
IA’s independence and objectivity

a. True, True
b. True, False
c. False, True
d. False, False 

The correct answer is: False, False

Question 39
Correct Mark 1.00 out of 1.00

Statement 1: The internal audit activity’s plan of engagements must be based on a

documented risk assessment, undertaken at least quarterly; Statement 2: The management
must establish risk-based plans to determine the priorities of the internal audit activity,
consistent with the organization’s goals.

a. False, False 
b. True, False
c. False, True
d. True, True

The correct answer is: False, False

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Question 40
Correct Mark 1.00 out of 1.00

Statement 1: The objective of audit report is to provide assurance to management on their

activities; Statement 2: Audit report aims to show managers how their problems may be
solved.

a. False; True
b. False; False
c. True; False
d. True; True 

The correct answer is: True; True

Question 41
Correct Mark 1.00 out of 1.00

Statement 1: The scope of the engagement must include consideration of relevant systems,
records, personnel, and physical properties, including those under the control of third
parties; Statement 2: The work program must be approved prior to its implementation, and
any adjustments approved promptly.

a. False, True
b. True, True 
c. True, False
d. False, False

The correct answer is: True, True

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Question 42
Correct Mark 1.00 out of 1.00

Statement 1: Tolerate means to focus on areas where controls are mitigating significant
risks and to ensure that they are actually working as intended; Statement 2: Communicate
means to set out unguarded risk and work out strategy for relaying position to the party
who cannot tackle it best.

a. False, True
b. True, False
c. False, False 
d. True, True

The correct answer is: False, False

Question 43
Correct Mark 1.00 out of 1.00

The audit plan should include the following, except

a. An estimate of the time required for each audit, risk, exposure and potential loss to the organization.
b. A detailed schedule of areas to be audited during the coming year.
c. The approximate starting date for each audit.
d. Major changes in operations in one of the departments. 

The correct answer is: Major changes in operations in one of the departments.

Question 44
Correct Mark 1.00 out of 1.00

The following are Good Board Practices except.

a. Board self-evaluation and training conducted

b. Clearly defined roles and authorities
c. The company is recognized as a corporate governance leader 
d. Appropriate composition and mix of skills

The correct answer is: The company is recognized as a corporate governance leader

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Question 45
Correct Mark 1.00 out of 1.00

The following are Mission and Purpose of the IA Department except

a. Determine the adequacy and effectiveness of the system of internal controls in all areas of activity.
b. Implement the rules and policies established by the board and safeguarding assets 
c. Review the reliability and integrity of financial information and the means used to identify measure, classify,
and report such information.
d. Review organization’s activities to determine whether it is efficiently and effectively carrying out its function of
controlling in accordance with management’s instructions, policies, and procedures.

The correct answer is: Implement the rules and policies established by the board and safeguarding assets

Question 46
Correct Mark 1.00 out of 1.00

The following are principles of Corporate Governance except

a. Respect the rights of major shareholders. 

b. Lay solid foundations for management and oversight.

c. Remunerate fairly and responsibly.
d. Promote ethical and responsible decision-making.

The correct answer is: Respect the rights of major shareholders.

Question 47
Correct Mark 1.00 out of 1.00

The following are the testing process, except

a. Perform the test

b. Interpret the results
c. Define the test objective
d. Give opinion 

The correct answer is: Give opinion

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Question 48
Correct Mark 1.00 out of 1.00

The overall responsibility for ensuring the risk is managed

a. Senior officer
b. Management
c. Board 
d. Internal Audit

The correct answer is: Board

Question 49
Correct Mark 1.00 out of 1.00

These are the causes of fraud except

a. Absence of proper control

b. Collusion within the department
c. Known and recorded internally 
d. Lack of separation of duties

The correct answer is: Known and recorded internally

Question 50
Correct Mark 1.00 out of 1.00

These are the indicators of fraud indicators except

a. Unexplained incomparable data

b. Tipp-ex
c. Tip from vendor 
d. Lavished Lifestyle

The correct answer is: Tip from vendor

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Question 51
Correct Mark 1.00 out of 1.00

These are the types of control except

a. Detective
b. Corrective
c. Directive
d. Direction 

The correct answer is: Direction

Question 52
Correct Mark 1.00 out of 1.00

To act on the direction of the BOD and to provide requisite information to the BOD for
decision-making are responsibilities of __________

a. Management 
b. Stakeholders
c. Board of Directors
d. Shareholders

The correct answer is: Management

Question 53
Correct Mark 1.00 out of 1.00

Which of the following describe s Well-defined shareholders?

a. The Board discusses corporate governance issues and has created a corporate governance committee
b. Clearly defined roles and authorities
c. Clearly defined and explicit dividend policy 
d. Appropriate composition and mix of skills

The correct answer is: Clearly defined and explicit dividend policy

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Question 54
Correct Mark 1.00 out of 1.00

Which of the following described characteristics of a Control Environment? i.Internal

control procedures; ii.Disaster recovery systems in place; iii.Management Information
systems established; iv.Policies and procedures have been formalized and distributed to
relevant staff; v.Media management techniques in use

a. I, II, III & IV only

b. I, II, IV & V only
c. I, II, III & V only 
d. I, II, III, IV & V

The correct answer is: I, II, III & V only

Question 55
Correct Mark 1.00 out of 1.00

Which of the following is a testing technique?

a. Receiving the service as a client.

b. All of the above. 
c. Independent confirmation.
d. Review of published reports/research.

The correct answer is: All of the above.

Question 56
Correct Mark 1.00 out of 1.00

Which of the following is an audit reporting process?

a. Good audit work.

b. All of the above. 
c. Effective review process.
d. Positive wrap-up meeting.

The correct answer is: All of the above.

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Question 57
Correct Mark 1.00 out of 1.00

Which of the following is an objective of audit report?

a. To assure management that business risks are well controlled.

b. To bring problems to management’s attention. 
c. To advise them on steps necessary to improve risk management strategies.
d. To alert them to areas where there are defined risk exposures.

The correct answer is: To bring problems to management’s attention.

Question 58
Correct Mark 1.00 out of 1.00

Which of the following is the characteristic of audit evidence?

a. Practical
b. Relevant
c. All of the above 
d. Sufficient

The correct answer is: All of the above

Question 59
Correct Mark 1.00 out of 1.00

Which of the following is/are the function of the audit report? I. To assure management
that business risk are well controlled; II.To alert them to areas where there are defined risk
exposures; III.To advise them on steps necessary to improve risk management strategy;
IV.To support action plans prepared by client management.

a. I, II, III, and IV 

b. II and III
c. I, II and III
d. I and II

The correct answer is: I, II, III, and IV

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Question 60
Correct Mark 1.00 out of 1.00

Working papers should generally

a. Facilitate third-party reviews.

b. Either a or b 
c. Provide the principal support for engagement results.
d. Neither a or b

The correct answer is: Either a or b

◄ Fourth and Final Examination: Competency Exam

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