Which of the following statements generally true regarding audit engagement planning?
Preparing a detailed audit program is a critical component of engagement planning. This program outlines the specific procedures and tests that the internal auditor will perform to evaluate the effectiveness of controls. It ensures that the audit is conducted systematically and thoroughly, addressing all relevant risks and objectives. A detailed audit program provides a clear roadmap for the audit, helping to ensure that all necessary areas are covered and that the audit's objectives are achieved. Reference:
The Institute of Internal Auditors (IIA) - Standards for the Professional Practice of Internal Auditing, Standard 2201 - Planning Considerations
Which of the following internal audit activities is performed in the design evaluation phase?
Which of the following statements is false regarding audit criteria?
Audit criteria should be appropriate and specific to each audit assignment, considering the unique context and objectives of each engagement. Consistency across all audit assignments (Option A) is not always feasible or desirable, as it could lead to inappropriate assessments. Instead, criteria should be flexible to allow the identification of nonadherence, represent reasonable standards, and align with good management practices relevant to each specific audit. Reference:
IIA Standard 2201: Planning Considerations.
IIA Practice Guide on Audit Planning.
To which of the following aspects should the chief audit executive give the most consideration while communicating an identified unacceptable risk to management?
The chief audit executive should give the most consideration to the organization's risk management policy when communicating an identified unacceptable risk to management. The risk management policy outlines the organization's approach to managing risk, including risk tolerance levels, risk appetite, and the procedures for identifying, assessing, and mitigating risks. By aligning the communication with the risk management policy, the CAE ensures that the discussion about unacceptable risk is framed within the context of the organization's established risk management framework, facilitating a more structured and effective response from management. Reference: The IIA's International Standards for the Professional Practice of Internal Auditing, Standard 2010 - Planning and COSO's Enterprise Risk Management Framework.
During the review of an organization's retail fraud deterrence program, an employee mentions that an expensive fraud surveillance information system is rarely used. The internal auditor concludes that additional staff are required to properly utilize the system to its full potential. According to IIA guidance, which criteria for evidence is most lacking to reach this conclusion?
