Exam 26: Internal and Governmental Financial Auditing and Operational Auditing

Recent research shows the board of directors is delegating oversight of management's enterprise risk management (ERM) responsibilities to the internal audit department in place of a board level committee.

(True/False)

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Question 61

What is the Institute of Internal Auditors Professional Practices Framework definition of internal auditing?

(Essay)

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Question 62

The professional organization which is responsible for providing guidance for internal auditors is the

(Multiple Choice)

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Question 63

How do the risk and materiality thresholds change in a government audit compared to a financial statement audit of a public company?

(Essay)

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Question 64

Discuss each of the three broad categories (types) of operational audits.

(Essay)

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Question 65

Which of the following statements regarding types of operational audits is likely incorrect?

(Multiple Choice)

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Question 66

Auditors can insist that the changes that they recommend as the result of an operational audit be implemented by the company.

(True/False)

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Question 67

3478277 -the review of an organization for efficiency and effectiveness

(Multiple Choice)

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Question 68

Which of the following is not a similarity between external and internal auditors?

(Multiple Choice)

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Question 69

Government auditing standards are included in the Yellow Book.

(True/False)

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Question 70

The Institute of Internal Auditors' Position Paper, "The Role of Internal Auditing in Enterprise-wide Risk Management," highlights six roles internal audit should not undertake within a company related to ERM activities. Name those six roles or activities.

(Essay)

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Question 71

Which one of the following is not a major difference between operational and financial auditing?

(Multiple Choice)

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Question 72

Match seven of the terms (a-o) with the descriptions/definitions provided below (1-7).

statements issued by the Internal Auditing Standards Board of the Institute of Internal Auditors (IIA) to provide authoritative interpretation of the Institute of Internal Auditors' Practice Standards

economy and efficiency audit

federal legislation that provides for a single coordinated audit to satisfy the audit requirements of all federal funding agencies

program audit

a management request for an operational audit for a specific purpose such as investigating the possibility of fraud in a division or making recommendations for reducing the cost of a manufactured product

IIA Practice Standards

Correct Answer:

Verified

statements issued by the Internal Auditing Standards Board of the Institute of Internal Auditors (IIA) to provide authoritative interpretation of the Institute of Internal Auditors' Practice Standards

federal legislation that provides for a single coordinated audit to satisfy the audit requirements of all federal funding agencies

a management request for an operational audit for a specific purpose such as investigating the possibility of fraud in a division or making recommendations for reducing the cost of a manufactured product

the review of an organization for efficiency and effectiveness

the official title of the Yellow Book

a government audit to determine whether an entity is acquiring protecting and using its resources economically and efficiently and whether the entity has complied with laws and regulations concerning such matters

the degree to which the organization's objectives are accomplished

(Matching)

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Question 73

Professional guidelines for performing internal audits for companies are not as well-defined as for external audits.

(True/False)

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Question 74

The primary source of authoritative literature for doing government audits is the

(Multiple Choice)

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Question 75

The objectives of internal auditors are considerably broader than the objectives of external auditors.

(True/False)

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Question 76

Effectiveness is concerned with whether defined goals are achieved, whereas efficiency is concerned with whether the goals are achieved with a minimum use of resources.

(True/False)

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Question 77

Operational auditing is the review of an organization for efficiency and effectiveness. Discuss what is meant by the terms "effectiveness" and "efficiency."

(Essay)

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Question 78

Independence is a fundamental ethical principle for internal auditors.

(True/False)

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Question 79

External financial statement auditors must obtain evidence regarding what attributes of an internal audit department if the external auditors intend to rely on the internal auditor's work?

(Multiple Choice)

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Question 80

Exam 26: Internal and Governmental Financial Auditing and Operational Auditing

Recent research shows the board of directors is delegating oversight of management's enterprise risk management (ERM) responsibilities to the internal audit department in place of a board level committee.

What is the Institute of Internal Auditors Professional Practices Framework definition of internal auditing?

The professional organization which is responsible for providing guidance for internal auditors is the

How do the risk and materiality thresholds change in a government audit compared to a financial statement audit of a public company?

Discuss each of the three broad categories (types) of operational audits.

Which of the following statements regarding types of operational audits is likely incorrect?

Auditors can insist that the changes that they recommend as the result of an operational audit be implemented by the company.

3478277 -the review of an organization for efficiency and effectiveness

Which of the following is not a similarity between external and internal auditors?

Government auditing standards are included in the Yellow Book.

The Institute of Internal Auditors' Position Paper, "The Role of Internal Auditing in Enterprise-wide Risk Management," highlights six roles internal audit should not undertake within a company related to ERM activities. Name those six roles or activities.

Which one of the following is not a major difference between operational and financial auditing?

Professional guidelines for performing internal audits for companies are not as well-defined as for external audits.

The primary source of authoritative literature for doing government audits is the

The objectives of internal auditors are considerably broader than the objectives of external auditors.

Effectiveness is concerned with whether defined goals are achieved, whereas efficiency is concerned with whether the goals are achieved with a minimum use of resources.

Operational auditing is the review of an organization for efficiency and effectiveness. Discuss what is meant by the terms "effectiveness" and "efficiency."

Independence is a fundamental ethical principle for internal auditors.

External financial statement auditors must obtain evidence regarding what attributes of an internal audit department if the external auditors intend to rely on the internal auditor's work?

The Demand for Audit and Other Assurance Services

The CPA Profession

Audit Reports

Professional Ethics

Legal Liability

Audit Responsibilities and Objectives

Audit Evidence

Audit Planning and Materiality

Assessing the Risk of Material Misstatement

Fraud Auditing

Internal Control and Coso Framework

Assessing Control Risk and Reporting on Internal Controls

Overall Audit Strategy and Audit Program

Audit of the Sales and Collection Cycle: Tests of Controls

Audit Sampling for Tests of Controls and Substantive Tests of Transactions

Completing the Tests in the Sales and Collection Cycle: Accounts Receivable

Audit Sampling for Tests of Details of Balances

Audit of the Acquisition and Payment Cycle: Tests of Controls, Substantive Tests of Transactions, and Accounts Payable

Completing the Tests in the Acquisition and Payment Cycle: Verification of Selected Accounts

Audit of the Payroll and Personnel Cycle

Audit of the Inventory and Warehousing Cycle

Audit of the Capital Acquisition and Repayment Cycle

Audit of Cash and Financial Instruments

Completing the Audit

Other Assurance Services

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