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IIA-IAP Exam Questions
- Topic 1: Internal Audit Attributes (IIA Standard 1000, 1100, 1200): This section measures the skills of Internal Audit Professionals and covers the elements of The IIA’s International Professional Practices Framework (IPPF). Candidates will explain the differences between assurance and consulting services provided by internal audit activities. They will define internal audit independence and an individual auditor's objectivity, including identifying any impairments to objectivity. Additionally, candidates will describe the knowledge and competencies required for internal auditors and define due professional care while illustrating competency through continuing professional development.
- Topic 2: Nature of Work (IIA Standard 2100): In this section, the exam focuses on Risk Management Specialists and defines fundamental concepts of risk and the effectiveness of risk management within processes and functions. Candidates will describe internal control concepts, types of controls, and globally accepted internal control frameworks.
- Topic 3: Engagement Planning (IIA Standard 2200): This section is aimed at Audit Managers and emphasizes identifying relevant information as part of a preliminary survey of the engagement area. Candidates will define engagement objectives, evaluation criteria, and the scope of the engagement to ensure key risks and controls are identified.
- Topic 4: Engagement Work (IIA Standard 2300): Targeted at Internal Audit Executives, this section covers recognizing the relevance, sufficiency, and reliability of evidence for workpapers that support conclusions and engagement results. Candidates will learn about the risk implications and relevant controls of common business processes such as human resources, procurement, and sales.
- Topic 5: Engagement Communication (IIA Standard 2400): This topic focuses on enhancing communication skills for Audit Communication Specialists. Candidates will recognize communication quality attributes such as accuracy, clarity, conciseness, and timeliness. They will discuss recommendations aimed at enhancing organizational value and describe various forms of engagement communication including preliminary reports, interim reporting, and conclusions to ensure effective stakeholder engagement throughout the audit process.
Free IIA IIA-IAP Exam Actual Questions
Note: Premium Questions for IIA-IAP were last updated On Jan. 23, 2025 (see below)
Management requested that the chief audit executive (CAE) include an audit of the organization's health and safety program in next year's annual audit plan. However, the internal audit activity has no expertise in this are
a. Which of the following would be the most appropriate actions for the CAE?
Comprehensive and Detailed Step-by-Step Explanation:
Reference to IIA Standards:
Standard 1210 - Proficiency: The internal audit activity must possess or obtain the knowledge, skills, and competencies needed to perform its responsibilities effectively.
If internal expertise is lacking, external resources or subject matter experts should be engaged.
Reasoning:
Option A is correct because collaborating with an internal expert ensures that the audit is performed competently while addressing the health and safety risks comprehensively.
Option B (amending the scope) avoids addressing critical risks, which may undermine the value of the audit.
Option C (relying on management's risk assessment) is inappropriate, as the internal audit function must independently evaluate the area.
Mitigating Lack of Expertise:
Leveraging subject matter experts ensures compliance with professional standards and the integrity of the audit process.
Which of the following internal auditor attributes benefits the most from continuous professional development?
Comprehensive and Detailed Step-by-Step Explanation:
Competency: Continuous professional development ensures auditors maintain and enhance their knowledge, skills, and expertise, directly supporting their ability to perform engagements effectively.
Other Options:
Option A: Integrity is a foundational ethical principle but is not developed through training or professional development.
Option B: Objectivity is influenced by ethical behavior and independence, not primarily by training.
Thus, the correct answer is C. Competency.
Which of the following scenarios would be the strongest indicator of fraud in an accounts payable process?
Comprehensive and Detailed Step-by-Step Explanation:
Address Matches an Employee's Residence: This is a strong indicator of fraud, as it suggests the possibility of a fictitious vendor created to divert funds to the employee.
Other Options:
Option A: Missing documentation may indicate poor record-keeping but is not a strong indicator of fraud on its own.
Option B: Delayed invoices might indicate inefficiencies, not fraud.
Thus, the correct answer is C. The address on one of the vendor invoices matches an employee's residential address.
Management has decided that transactions less than $50 no longer require authorization. Which of the following risk management strategies does this represent?
Comprehensive and Detailed Step-by-Step Explanation:
Risk Acceptance: By deciding that transactions below $50 do not require authorization, management is consciously accepting the low-level risk associated with this decision to streamline processes and reduce administrative burdens.
Other Options:
Option A: Risk avoidance would involve eliminating the activity altogether, which is not the case here.
Option C: Risk reduction would involve implementing controls to mitigate the risk, not eliminating authorization requirements.
Thus, the correct answer is B. Accept.
A senior police officer was in charge of the cash fund used for undercover operations. In this situation, which of the following would likely be considered a red flag?
Comprehensive and Detailed Step-by-Step Explanation:
Living Beyond Means: This is a classic red flag for potential fraud. It suggests that the officer may be using unauthorized funds to support an extravagant lifestyle, particularly when they have access to a cash fund with limited oversight.
Other Options:
Option A: Lack of professional qualifications may affect competence but is not directly linked to fraudulent behavior.
Option C: Silence about operations may reflect confidentiality requirements rather than misconduct.
Thus, the correct answer is B. The officer appears to be living beyond his means.
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