Exam 4: Conducting the Internal Audit Engagement

A code of business conduct should include which of the following to increase its deterrent effect? 1. Appropriate descriptions of penalties for misconduct. 2. A notification that code of conduct violations may lead to criminal prosecution. 3. A description of violations that injure the interests of the employer. 4. A list of employees covered by the code of conduct.

In reviewing the appropriateness of the minimum quantity level of inventory established by a department, an auditor would be least likely to consider:

The internal audit activity of an investment company received a request to provide assurance on the risk management process. Preliminary discussion with senior management revealed that separate functions within the organization perform some form of risk management activities. Which of the following is the most effective tool for ensuring that risk management activities are coordinated among these functions?

A company has recently incurred significant cost overruns on one of its construction projects. Management suspects that these overruns were caused by the contractor improperly accounting for costs related to contract change orders. Which of the following procedures would be appropriate for testing this suspicion?

According to the International Professional Practices Framework, which of the following is correct regarding conducting and reporting follow-up activities by the internal audit activity (IAA)?

An organization's internal auditors are reviewing production costs at a gas-powered electrical generating plant. They identify a serious problem with the accuracy of carbon dioxide emissions reported to the environmental regulatory agency, due to computer errors. The auditors should immediately report the concern to:

Recommendations should be included in the audit report in order to:

The board has asked the internal audit activity (IAA) to be involved in the organization's enterprise risk management process. Which of the following activities is appropriate for IAA to perform without safeguards?