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IIA-CRMA Updated Exam Dumps [2021] Practice Valid Exam Dumps Question
NEW QUESTION 144
Why are preventative controls generally preferred to detective controls?
- A. Because preventive controls include output procedures, which cover the full range of possible reviews, reconciliations and analysis.
- B. Because preventive controls are more sensitive and identify more exceptions than detective controls.
- C. Because preventive controls identify exceptions after-the-fact, allowing them to be used after the entire review is complete and therefore finding exceptions that detective controls may have missed.
- D. Because preventive controls promote doing the right thing in the first place, and lessen the need for corrective action.
Answer: D
NEW QUESTION 145
An internal audit activity (IAA) provided assurance services for an activity it was responsible for during the preceding year.
As a result, which IIA Code of Ethics principle is presumed to be impaired?
- A. Objectivity.
- B. Competence.
- C. Independence.
- D. Flexibility.
Answer: A
NEW QUESTION 146
A manufacturing organization discovers that the waste water released has failed to meet permitted limits.
Which control function will be least effective in correcting the issue?
- A. Establishing a preventive maintenance program for the pretreatment system.
- B. Posting signs that tell employees which substances may be disposed of via sinks and floor drains within the facility.
- C. Diluting pollutants by flushing sinks and floor drains daily with large volumes of clean water.
- D. Performing a chemical analysis of the water, prior to discharge, for components specified in the permit.
Answer: C
NEW QUESTION 147
Non-statistical sampling does not require which of the following?
- A. The sample to be representative of the population.
- B. A smaller sample size than if selected using statistical sampling.
- C. Projecting the results to the population.
- D. The sample to be selected haphazardly.
Answer: B
NEW QUESTION 148
According to The MA Global Internal Audit Competency Framework, which of the following areas of training would best assist the internal audit activity in improving its use of tools and techniques?
- A. Financial accounting.
- B. Project management.
- C. Ethics and fraud.
- D. Negotiation and conflict resolution.
Answer: B
NEW QUESTION 149
According to IIA guidance, which of the following statements describes one of the similarities between assurance and consulting services?
- A. Internal auditors must not provide assurance or consulting services for an activity for which they had responsibility within the previous year.
- B. Internal auditors determine the engagement objectives, scope, and work program for both assurance and consulting services.
- C. When planning assurance and consulting engagements, internal auditors must consider the strategies and objectives of the activity being reviewed.
- D. Both assurance and consulting services generally involve the internal auditor, the area under review, senior management, and the board.
Answer: C
NEW QUESTION 150
According to COSO, which of the following describes a principle related to the control environment?
- A. The organization identifies and assesses changes that could significantly impact the system of internal control.
- B. The organization establishes appropriate authorities and responsibilities in the pursuit of objectives.
- C. The organization performs evaluations to ascertain whether internal control components are present and functioning.
- D. The organization selects and develops control activities that contribute to the mitigation of risks.
Answer: B
NEW QUESTION 151
Which of the following would most likely be considered a red flag for fraud?
- A. An organization lacks a whistleblower hotline for reporting suspicious activity.
- B. An employee in charge of payroll disbursements has rotated these duties with several colleagues.
- C. A senior manager has been delegating the authority to sign-off on small dollar amount purchases to a subordinate.
- D. An employee with significant personal debt is in charge of handling large wire transfers for the organization.
Answer: D
NEW QUESTION 152
Which of the following statements is true regarding the use of non-statistical sampling in auditing control tests?
- A. Non-statistical sample results must be projected to the population.
- B. Lesser evidence is required to support a conclusion than for statistical sampling.
- C. Sampling risk will be accurately quantified through non-statistical sampling.
- D. It considers tolerable deviation rate more effectively than does statistical sampling.
Answer: A
NEW QUESTION 153
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, 2, and 4 only
- B. 2 and 3 only
- C. 1 and 4 only
- D. 3 and 4 only
Answer: A
NEW QUESTION 154
According to The MA Code of Ethics, which of the following is one of the rules of conduct for objectivity?
- A. Internal auditors shall continually improve their proficiency and effectiveness and quality of their services.
- B. Internal auditors shall not accept anything that may impair or be presumed to impair their professional judgment.
- C. Internal auditors shall be prudent in the use and protection of information acquired in the course of their duties.
- D. Internal auditors shall respect and contribute to legitimate and ethical objectives of the organization.
Answer: B
NEW QUESTION 155
Which of the following statements best explains why internal auditors map processes?
1. To obtain audit evidence to support auditor's observations.
2. To determine scope and objectives of the audit.
3. To facilitate the identification of ownership and responsibility for key risks.
4. To identify potential efficiency improvements.
- A. 1 and 3.
- B. 3 and 4.
- C. 2 and 4.
- D. 1 and 2.
Answer: B
NEW QUESTION 156
Which of the following activities should the chief audit executive perform to ensure compliance with an organization's code of conduct?
- A. Lead the committee responsible for the oversight of the code.
- B. Act as an adviser to the committee responsible for reviewing violations of the code.
- C. Review and adjudicate all violations of the code of conduct.
- D. Implement a system of procedures to inform all employees of the code.
Answer: B
NEW QUESTION 157
The chief audit executive (CAE) is planning to conduct an internal assessment of the internal audit activity (IAA). Part of this assessment will include benchmarking. According to IIA guidance, which of the following qualitative metrics would be appropriate for the CAE to use?
1. Average client customer satisfaction score for a given year.
2. Client survey comments on how to improve the IAA.
3. Auditor interviews once an audit has been completed.
4. Percentage of audits completed within 90 days.
- A. 1 and 3.
- B. 2 and 3.
- C. 1 and 2.
- D. 3 and 4.
Answer: B
NEW QUESTION 158
Management would like to self-assess the overall effectiveness of the controls in place for its 200-person manufacturing department. Which of the following client-facilitated approaches is likely to be the most efficient way to accomplish this objective?
- A. Observation.
- B. Interviews.
- C. Workshops.
- D. Surveys.
Answer: D
NEW QUESTION 159
Which of the following statements is true about The IIA Global Internal Audit Competency Framework?
- A. The core competencies outlined in the framework are not expected of a person undertaking an entry-level position as an internal auditor.
- B. The framework describes competencies needed for individual internal auditors, but not those necessary at the chief audit executive level.
- C. The framework is designed to be used primarily by chief audit executives that are developing indicators to measure the performance of the internal audit activity for which they are responsible.
- D. The framework lists the core competencies internal auditors should possess before attempting to attain The IIA's Certified Internal Auditor certification.
Answer: C
NEW QUESTION 160
Which of the following is not one of the 10 core competencies identified in the IIA Competency Framework?
- A. Governance, risk, and control.
- B. Business acumen.
- C. Internal audit delivery.
- D. Performance management.
Answer: D
NEW QUESTION 161
An organization decides to take no action on one of its financial risks because the cost of implementing the control outweighs the value of the asset being protected. Which of the following best describes this risk strategy?
- A. Risk acceptance.
- B. Risk-benefit analysis.
- C. Risk sharing.
- D. Risk avoidance.
Answer: A
NEW QUESTION 162
According to IIA guidance, which of the following must internal auditors consider to conform with the requirements for due professional care during a consulting engagement?
1. The cost of the engagement, as it pertains to audit time and expenses in relation to the potential benefits.
2. The needs and expectation of clients, including the nature, timing, and communication of engagement results.
3. The application of technology-based audit and other data analysis techniques, where appropriate.
4. The relative complexity and extent of work needed to achieve the engagement's objectives.
- A. 1, 3, and 4
- B. 2, 3, and 4
- C. 1, 2, and 3
- D. 1, 2, and 4
Answer: D
NEW QUESTION 163
An internal auditor is reviewing the accounts receivable when she discovers account balances more than three years old. The auditor was previously supervising the area during this time, and she subsequently advises the chief audit executive (CAE) of a potential conflict.
Which of the following is the most appropriate course of action for the CAE to take?
- A. Replace the auditor with another audit staff member.
- B. Withdraw the audit team and outsource the financial audit of the division.
- C. Continue with the present auditor, as more than one year has passed.
- D. Work with the division's management to resolve the situation.
Answer: A
NEW QUESTION 164
According to IIA guidance, which of the following scenarios demonstrates an internal auditor exercising due professional care?
When auditing investments, the auditor identified instruments with which he was unfamiliar.
- A. An auditor was reviewing inventory counts conducted by the warehouse staff. One truck containing an immaterial amount of inventory was off-site and wasn't verified by the auditor.
- B. An auditor visited a plant that produces a significant portion of the organization's inventory. The day he arrived, the plant manager was out sick, so the auditor issued the report without interviewing the manager.
- C. He decided not to select that type of investment in his sample, as he did not have the knowledge needed to perform a proper assessment.
- D. An auditor in charge needed to have testing completed by the end of the month, but was behind schedule. He identified a junior auditor to conduct the work for him on a complex area of the organization.
Answer: C
NEW QUESTION 165
An internal auditor is conducting an assessment of the organization's fraud prevention program using the COSO enterprise risk management framework. According to this framework, which of the following activities would fall under the control environment component for preventing fraud?
1. The organization uses an automated authority approval matrix to control payments.
2. The organization has a whistleblower hotline that is available to employees.
3. Annually, every manager completes a comprehensive fraud assessment of his or her department.
4. Annually, the organization reviews and communicates the code of expected behavior.
- A. 2 and 4.
- B. 1 and 3.
- C. 2 and 3.
- D. 1 and 2.
Answer: A
NEW QUESTION 166
While auditing an organization's credit approval process, an internal auditor learns that the organization has made a large loan to another auditor's relative. Which course of action should the auditor take?
- A. Proceed with the audit engagement, but do not include the relative's information.
- B. Have the chief audit executive and management determine whether the auditor should continue with the audit engagement.
- C. Immediately withdraw from the audit engagement.
- D. Disclose in the engagement final communication that the relative is a customer.
Answer: B
NEW QUESTION 167
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