IIA Updated IIA-CIA-Part1 Exam Questions and Answers by adeline

According to the IIA Standards, internal auditors must have sufficient knowledge to evaluate the risk of fraud and the manner in which IT is managed. This includes understanding their organization's IT governance, risk, and control processes (Option D). Standard 1210.A3 specifies that internal auditors must have sufficient knowledge of key information technology risks and controls and available technology-based audit techniques to perform their assigned work. This ensures that auditors can effectively assess and contribute to the improvement of the organization's IT governance and control environment.References:

• IIA Standards, Standard 1210.A3: Proficiency - Technology-based Audit Techniques
• IIA's International Professional Practices Framework (IPPF)

In a competitive retail environment where sales teams are incentivized to meet or exceed targets, there is a significant risk of data manipulation. Employees may falsify sales records, inflate numbers, or engage in other unethical behaviors to ensure they receive bonuses. This is a common issue in environments with high stakes and rewards tied to performance metrics, as the pressure to succeed can lead individuals to manipulate data to appear more successful than they actually are. Therefore, management should closely monitor data integrity and implement strong controls to detect and prevent such manipulation. References: The IIA’s International Standards for the Professional Practice of Internal Auditing (Standards), specifically Standard 2120 - Risk Management, and COSO’s Internal Control - Integrated Framework.

According to IIA guidance, the chief audit executive (CAE) is required to report the results of ongoing monitoring and periodic quality assessments to both senior management and the board at least annually. This ensures transparency and allows for any necessary actions to improve the quality and performance of the internal audit activity. References: The IIA’s International Standards for the Professional Practice of Internal Auditing (Standards), specifically Standard 1311 - Internal Assessments, Standard 1320 - Reporting on the Quality Assurance and Improvement Program, and Standard 1312 - External Assessments.

When an internal auditor has audited the same department repeatedly, familiarity threat is a significant concern. The IIA Standards emphasize maintaining objectivity and avoiding circumstances that could impair the auditor's unbiased attitude. Auditing the same department annually for several years can lead to familiarity, which can compromise the internal audit activity's independence and objectivity (Option B). According to Standard 1130: Impairment to Independence or Objectivity, auditors must avoid auditing areas where repeated engagements might lead to a lack of objectivity due to familiarity.References:

• IIA Standards, Standard 1130: Impairment to Independence or Objectivity
• IIA Practice Guide: Independence and Objectivity