IIA Updated IIA-CIA-Part2 Exam Questions and Answers by zidan

According to the Institute of Internal Auditors (IIA) guidance, the independence and objectivity of the internal audit function are fundamental principles. Independence is compromised if the internal audit function takes on roles or responsibilities that are part of management's duties. Coordinating and managing the risk management process is a management responsibility. If internal auditors assume this role, it impairs their ability to remain independent and objective when auditing the effectiveness of the risk management process. References: IIA Standard 1112 – Chief Audit Executive Roles Beyond Internal Auditing

Due diligence engagements are crucial when planning an acquisition, as they evaluate the financial, operational, and legal aspects of the target entity. This ensures informed decision-making and minimizes acquisition risks. Performance engagements (Option A) focus on efficiency and effectiveness of operations, while system security engagements (Option B) and compliance engagements (Option D) do not address the comprehensive assessment required for acquisitions. The CIA syllabus emphasizes due diligence as a specialized type of consulting engagement (Part 2: Section II).

The most effective way to identify the HR department's risks and controls, especially after recent process changes, is to discuss the department's present strategies and objectives with the head of the HR department. This approach allows the auditor to gain current and relevant insights directly from the person most knowledgeable about the department's current operations, risks, and controls. It ensures that the auditor understands the current environment, any new challenges, and the specific controls in place to mitigate risks. This method is more comprehensive and current compared to reviewing past reports or generalized organizational frameworks, which might not reflect recent changes accurately.

References:

The Institute of Internal Auditors (IIA) Standard 2010 – Planning: "The chief audit executive must establish risk-based plans to determine the priorities of the internal audit activity, consistent with the organization’s goals."

IIA Practice Guide on "Engaging with Stakeholders"