INTERNAL AUDIT EXAM 2 SU 2 2025
QUESTIONS AND ANSWERS
The primary difference between operational engagements and financial engagements is that, in
the latter, the internal auditors
A. Are not concerned with whether the client entity is generating information in compliance
with financial accounting standards.
B. Are seeking to help management use resources in the most effective manner possible.
C. Can use analytical skills and tools that are not necessary in financial engagements.
D. Start with the financial statements of the client entity and work backward to the basic
processes involved in producing them. - ANS Correct D. Start with the financial statements of
the client entity and work backward to the basic processes involved in producing them.
A determination of cost savings is most likely to be an objective of a(n)
A. Program-results engagement.
B. Financial engagement.
C. Compliance engagement.
D. Operational engagement. - ANS Correct D. Operational engagement.
Which of the following procedures is the most valuable in an engagement involving the traffic
department operations of a large manufacturer?
A. Obtain written confirmation from the regulatory agencies that all carriers used are properly
licensed and bonded.
B. Review procedures for selection of routes and carriers.
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, C. Trace selected items from the weekly demurrage (car detention charge) report to supporting
documentation.
D. Verify that all bills of lading are prenumbered. - ANS Correct B. Review procedures for
selection of routes and carriers.
Which of the following activities is outside the scope of internal auditing?
A. Evaluating risk exposures regarding compliance with policies, procedures, and contracts.
B. Safeguarding of assets.
C. Evaluating risk exposures regarding compliance with laws and regulations.
D. Ascertaining the extent to which management has established criteria to determine whether
objectives have been accomplished. - ANS Correct B. Safeguarding of assets.
Which of the following statements about control self-assessment (CSA) is false?
A. CSA is usually an informal and undocumented process.
B. In its purest form, CSA integrates business objectives and risks with control processes.
C. CSA is also known as control/risk self-assessment.
D. Most implemented CSA programs share some key features and goals. - ANS Correct A.
CSA is usually an informal and undocumented process.
Which type of facilitated approach format begins by listing all possible barriers, obstacles,
threats, and exposures that might prevent achieving an objective?
A. Objective-based format.
B. Control-based format.
C. Process-based format.
D. Risk-based format. - ANS Correct D. Risk-based format.
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QUESTIONS AND ANSWERS
The primary difference between operational engagements and financial engagements is that, in
the latter, the internal auditors
A. Are not concerned with whether the client entity is generating information in compliance
with financial accounting standards.
B. Are seeking to help management use resources in the most effective manner possible.
C. Can use analytical skills and tools that are not necessary in financial engagements.
D. Start with the financial statements of the client entity and work backward to the basic
processes involved in producing them. - ANS Correct D. Start with the financial statements of
the client entity and work backward to the basic processes involved in producing them.
A determination of cost savings is most likely to be an objective of a(n)
A. Program-results engagement.
B. Financial engagement.
C. Compliance engagement.
D. Operational engagement. - ANS Correct D. Operational engagement.
Which of the following procedures is the most valuable in an engagement involving the traffic
department operations of a large manufacturer?
A. Obtain written confirmation from the regulatory agencies that all carriers used are properly
licensed and bonded.
B. Review procedures for selection of routes and carriers.
Copyright ©2025 THEBRIGHT ALL RIGHTS RESERVED 1
, C. Trace selected items from the weekly demurrage (car detention charge) report to supporting
documentation.
D. Verify that all bills of lading are prenumbered. - ANS Correct B. Review procedures for
selection of routes and carriers.
Which of the following activities is outside the scope of internal auditing?
A. Evaluating risk exposures regarding compliance with policies, procedures, and contracts.
B. Safeguarding of assets.
C. Evaluating risk exposures regarding compliance with laws and regulations.
D. Ascertaining the extent to which management has established criteria to determine whether
objectives have been accomplished. - ANS Correct B. Safeguarding of assets.
Which of the following statements about control self-assessment (CSA) is false?
A. CSA is usually an informal and undocumented process.
B. In its purest form, CSA integrates business objectives and risks with control processes.
C. CSA is also known as control/risk self-assessment.
D. Most implemented CSA programs share some key features and goals. - ANS Correct A.
CSA is usually an informal and undocumented process.
Which type of facilitated approach format begins by listing all possible barriers, obstacles,
threats, and exposures that might prevent achieving an objective?
A. Objective-based format.
B. Control-based format.
C. Process-based format.
D. Risk-based format. - ANS Correct D. Risk-based format.
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