WorksheetsUnit 4.1: Elements of the QAIP
Total questions: 59
Worksheet time: 2hrs 58mins
Name
Class
Date
1.
Which of the following is responsible for developing and maintaining a quality assurance and improvement program (QAIP) that covers all aspects of the internal audit function?
a)
Senior management.
b)
Chief audit executive.
c)
Chief compliance officer.
d)
External service providers.
2.
Which element is typically included in a quality assurance and improvement program for the internal audit function?
a)
Annual evaluations of individual auditors' performance.
b)
Regular internal assessments of audit processes.
c)
Continuous oversight and supervision of audit activities.
d)
Annual external assessments of audit quality.
3.
Which factor should be evaluated in a quality assurance and improvement program (QAIP)?
a)
The effectiveness of oversight regarding the internal audit function.
b)
The adequacy of established best practices.
c)
The adequacy of the internal audit function's communications.
d)
The frequency of internal audit staff training sessions.
4.
An internal auditor at a tech company is developing a quality assurance and improvement program (QAIP). Which component is essential for ensuring ongoing conformance with the Standards?
a)
Performing external assessments every 5 years.
b)
Regularly updating the internal audit charter.
c)
Implementing ongoing internal assessments.
d)
Outsourcing the QAIP to an external firm.
5.
An internal audit function's quality assurance and improvement program (QAIP) encompasses all aspects of the internal audit function's operations except advisory services.
a)
Encompasses all aspects of the internal audit function's operations except advisory services.
b)
Includes analysis of the execution of the internal audit plan.
c)
Must have a full external independent assessment every 3 years.
d)
Should be developed and maintained by the board.
6.
An organization is planning an external quality assessment of its internal audit function. Which of the following factors should the CAE prioritize when selecting the assessment team?
a)
The team members' familiarity with the organization's specific industry.
b)
The cost of the assessment service.
c)
Previous employment may incur independence, which is required for assessors.
d)
Proximity is less important than expertise and independence.
7.
An organization is experiencing significant staff turnover in its internal audit function. What action should the chief audit executive (CAE) consider regarding the timing of the next external quality assessment?
a)
Delay the assessment until staff levels stabilize.
b)
Perform the assessment immediately to address potential effects of turnover.
c)
Maintain the original schedule of every 5 years.
d)
Postpone the assessment due to the inexperience of the staff.
8.
An external quality assessment at FinBank found that the internal audit function is not using data analytics tools effectively. What is an appropriate action for the CAE to take to address this finding?
a)
Focus on other areas because the finding is a minor issue.
b)
Hire a consultant to perform all data analytics tasks.
c)
Outsource the internal audit function to a third-party provider.
d)
Develop a training program to improve auditors' data analytics skills.
9.
A chief audit executive (CAE) is planning a self-assessment with independent validation. Which of the following steps is most important to ensure the validity of the results?
a)
Engaging an independent external assessor for validation.
b)
Including only senior internal staff in the assessment process.
c)
Performing the assessment without external involvement.
d)
Limiting the scope to avoid confidential areas.
10.
As a new auditor at a healthcare organization, you notice that the internal audit function has not performed an external quality assessment in over 6 years. What should be your first course of action?
a)
Recommend performing an internal quality assessment instead because it is less costly.
b)
Immediately notify The IIA about the noncompliance.
c)
Suggest that the CAE schedule an external quality assessment as soon as possible to comply with The IIA's Standards.
d)
Perform a self-assessment and report the findings to the CAE.
11.
Internal audit function is preparing for an external quality assessment. Which of the following is most likely to improve the independence of the assessment team?
a)
Inclusion of a former employee of the internal audit function.
b)
Hiring an external consultant with no prior experience within the organization.
c)
Selecting a team from a different department within the same organization.
d)
Engaging a team that has previously performed assessments in a similar industry.
12.
A quality assurance and improvement program of an internal audit function provides reasonable assurance that internal auditing work is performed in accordance with its charter. Which of the following are designed to provide feedback on the effectiveness of an internal audit function?
a)
Proper supervision, proper training and internal reviews.
b)
Proper training, internal reviews, and external reviews.
c)
Proper supervision, internal reviews, and external reviews.
d)
Proper supervision, proper training, internal reviews, and external reviews.
13.
The internal audit function's quality assurance and improvement program is the responsibility of
a)
External auditors.
b)
The chief audit executive.
c)
The board.
d)
The audit committee.
14.
According to the Global Internal Auditing Standards, when may a self-assessment be performed in lieu of a full external assessment?
a)
When the self-assessment has been validated by a qualified, independent, competent, and professional external assessor.
b)
When the internal audit function has conducted an external assessment within the past 2 years.
c)
When ongoing monitoring of the internal audit function has not identified any weaknesses or areas in need of improvement.
d)
A self-assessment may not be performed in lieu of a full external assessment of the internal audit function's conformance with the Standards.
15.
A rating scale may be used in an external assessment to show the degree of conformance with the Standards by an internal audit function. One scale consists of three ratings: generally conforms, partially conforms, and does not conform. "Partially conforms" most likely indicates that
a)
Deficiencies in practices are judged to be so significant as to seriously impair, or preclude, the internal audit function's ability to perform adequately in all or significant areas of its responsibilities.
b)
The assessor is unable to obtain sufficient appropriate audit evidence to conclude that the financial statements as a whole are free from material misstatements.
c)
Deficiencies do not preclude the internal audit function from performing its responsibilities.
d)
An internal audit function has a charter, policies, and processes, and their execution and results conform with the Standards.
16.
Internal assessments of the internal audit function consist of all of the following, except
a)
Evaluation of conformance with the mandatory elements of the IPPF.
b)
Evaluation of the establishment and achievement of key performance indicators.
c)
Evaluation of the quality and supervision of the audit work performed.
d)
An independent external assessment team identifies areas for improvement.
17.
An internal audit function's quality assurance and improvement program (QAIP)
a)
Is subject to external assessments in the form of ongoing monitoring.
b)
Generally is directed by a chief audit executive (CAE) that meets with the CFO to discuss expectations for the internal audit function.
c)
Includes periodic self-assessments by an independent assessor.
d)
Assesses the efficiency of the internal audit function.
18.
An internal audit function's quality assurance and improvement program (QAIP)
a)
Has three components: assessment, communication, and disclosure of nonconformance.
b)
Is based on the mandatory elements of The IIA's guidance.
c)
Must conduct an internal self-assessment at least once every 3 years.
d)
Solely addresses compliance with the Standards.
19.
An external assessment of an internal audit function contains an expressed opinion. The opinion may apply
a)
Only to the internal audit function's conformance with the internal audit mandate.
b)
Only to the effectiveness of the internal auditing coverage.
c)
Only to the adequacy of internal control.
d)
To conformance with the Standards and an assessment for each standard.
20.
Ordinarily, those conducting internal quality program assessments report to
a)
The board.
b)
The chief audit executive.
c)
Senior management.
d)
The internal audit staff.
21.
Quality program assessments may be performed internally or externally. A distinguishable feature of an external assessment is its objective to
a)
Identify tasks that can be performed better.
b)
Determine whether internal audit services meet professional standards.
c)
Set forth the recommendations for improvement.
d)
Provide independent assurance.
22.
As a part of a quality program, internal assessment teams most likely will examine which of the following to evaluate the quality of engagement planning and documentation for individual engagements?
a)
Measures of project budgets and audit plan completion.
b)
Project assignment documentation.
c)
Weekly status reports.
d)
The long-range engagement work schedule.
23.
Periodic internal assessments of the internal audit function primarily serve the needs of
a)
The board of directors.
b)
The internal audit function's staff.
c)
The chief audit executive (CAE).
d)
Senior management.
24.
External assessment of an internal audit function is not likely to evaluate
a)
Adherence to the internal audit function's charter.
b)
Conformance with the Standards.
c)
Detailed cost-benefit analysis of the internal audit function.
d)
The internal audit staff's expertise.
25.
The interpretation related to quality assurance given by the Standards is that
a)
External assessments can provide senior management and the board with independent assurance about the quality of the internal audit function.
b)
Appropriate follow-up by an external assessment is the responsibility of the chief audit executive's immediate supervision.
c)
The internal audit function is primarily measured against the ethics standards within the Global Internal Audit Standards.
d)
Supervision is limited to the planning, examination, evaluation, communication, and follow-up process.
26.
Which of the following is not true of quality assessments that are implemented according to IIA guidance?
a)
The results of a quality assessment can be shared with senior management and the board.
b)
A quality assessment team would be expected to review the internal audit function's efficiency and effectiveness.
c)
Company managers or members of the board may be members of the external quality assessment team if they are qualified, since they are independent of the internal audit function.
d)
The quality assessment process may include feedback from engagement clients through interviews and questionnaires or surveys.
27.
Which of the following is only part of an internal audit function's quality assurance program rather than being included as part of other responsibilities of the chief audit executive (CAE)?
a)
The CAE provides information about and access to internal audit working papers to the external auditors to ensure them to understand and determine the degree to which they may rely on the internal auditors' work.
b)
Management approves a formal charter establishing the purpose, authority, and responsibility of the internal audit function.
c)
Each individual internal auditor's performance is appraised at least annually.
d)
Supervision of an internal auditor's work is performed throughout each audit engagement.
28.
Which of the following statements is not true regarding adequate supervision?
a)
It is a fundamental element of external assessments.
b)
It involves ongoing communications among internal auditors.
c)
Sign-offs by engagement supervisors are required.
d)
It occurs during the planning phase of the engagement.
29.
Ongoing monitoring by an internal audit function's quality assurance and improvement program (QAIP) most likely
a)
Includes a comprehensive review of the internal audit function.
b)
Is achieved by such periodic activities as soliciting client feedback.
c)
Is performed only by senior internal auditors.
d)
Focuses on report reviews at the engagement level.
30.
A peer review by a related organization of a quality assurance and improvement program (QAIP) is
a)
Peer review by a related organization.
b)
Adequate supervision.
c)
Checklists.
d)
Periodic self-assessment by an independent assessor.
31.
In the context of a quality assurance and improvement program (QAIP), periodic self-assessments
a)
Generally are performed by senior internal auditors.
b)
Emphasize evaluation of conformance with performance standards.
c)
Primarily involve continuous activities.
d)
Determine whether quality is delivered on an engagement-by-engagement basis.
32.
Full external assessment of the internal audit function's conformance with the Standards
a)
Is a self-assessment with external validation.
b)
Requires onsite validation by an independent, external assessor.
c)
Is conducted by an external assessor or assessment team.
d)
Should be incorporated into the internal audit function's routine policies and practices.
33.
The scope of a full external assessment of an internal audit function most significantly
a)
Incorporates a comprehensive self-assessment process.
b)
Obtains feedback from audit clients.
c)
Examines key performance indicators for the internal audit staff.
d)
Addresses the extent to which the internal audit function adds value.
34.
A quality assurance and improvement program (QAIP) for an internal audit function must include ongoing monitoring
a)
By an assessor from outside the organization.
b)
With external validation.
c)
On the quality of engagements.
d)
That comprehensively reviews conformance with the Standards.
35.
Periodic self-assessments are a component of a quality assurance and improvement program (QAIP) for an internal audit function. They most likely include
a)
Assessments by senior internal auditors or certified internal auditors.
b)
Daily review of functions incorporated into routine policies used to manage the internal audit function.
c)
Continuous activities such as engagement planning and supervision.
d)
Validation by a qualified, independent assessor.
36.
Internal assessments as part of a quality assurance and improvement program (QAIP) for an internal audit function must include
a)
Onsite validation by an external assessor.
b)
Self-assessment of the full external assessment.
c)
Assessment by a qualified, independent individual every 5 years.
d)
Establishment of a structure for reporting results to the chief audit executive (CAE).
37.
External assessments as part of a quality assurance and improvement program (QAIP) of an internal audit function may be performed by
a)
Peer review between two unrelated organizations.
b)
External assessors with no real or apparent conflict of interest.
c)
The external auditor of the financial statements.
d)
A former employee who provides significant consulting services.
38.
Which of the following are the interrelated parts of internal assessments as part of a quality assurance and improvement program (QAIP) of an internal audit function?
a)
Ongoing monitoring and self-assessment with independent external validation.
b)
Periodic self-assessments and ongoing monitoring.
c)
Periodic self-assessments and ongoing monitoring.
d)
Self-assessment with independent external validation and adequate supervision.
39.
What minimal required frequency does the chief audit executive report the results of internal assessments in the form of ongoing monitoring to senior management and the board?
a)
Monthly.
b)
Quarterly.
c)
Annually.
d)
Biennually.
40.
Following an external assessment of the internal audit function, who is (are) responsible for communicating the results to the board?
a)
Internal auditors.
b)
Audit committee.
c)
Chief audit executive.
d)
External auditors.
41.
An external audit committee may determine that the internal audit function conforms with the Global Internal Audit Standards only if the results of the quality assurance and improvement program support this statement. The internal audit function must be conducted
a)
It is supported by the results of the quality program.
b)
An independent external assessment of the internal audit function is conducted annually.
c)
The CAE must develop and maintain a QAIP that covers all aspects of the internal audit function.
d)
Assessments also may be made by others who are (1) independent, (2) qualified, and (3) from outside the organization.
42.
When is initial use of the conformance phrase by internal auditors appropriate?
a)
After an internal review completed within the past 5 years.
b)
After an external review completed within the past 10 years.
c)
After an external review completed within the past 10 years.
d)
After an external review completed within the past 5 years.
43.
Which of the following would demonstrate that the internal audit function is in compliance with IIA practices?
a)
The chief audit executive determines the form and content of the results communicated.
b)
The results of external assessments are communicated upon their completion.
c)
The results of periodic internal assessments are communicated at least twice a year.
d)
The results of ongoing monitoring are communicated upon their completion.
44.
Why should a chief audit executive recommend that the results of an internal quality assessment be shared with the board?
a)
To motivate staff in the internal audit function to accept the need for external assessment.
b)
To provide accountability and transparency for the internal audit function's operations.
c)
To emphasize the importance of the internal audit function's charter.
d)
To increase communications between the internal audit function and the audit committee.
45.
Potential conflicts of interest with the quality assurance assessment team should be disclosed by:
a)
Senior management and the board.
b)
Internal audit staff.
c)
Internal audit function.
d)
Chief audit executive.
46.
The CAE's chief audit executive's disclosure to senior management and the board regarding the QAIP should include all of the following except
a)
Conclusions of assessors.
b)
Corrective action plans.
c)
Scope and frequency of external assessments.
d)
Checklists or automation tools used.
47.
Corrective action plans may be provided to address recommendations from an external assessment of the internal audit function. The chief audit executive's responsibilities for these plans include Adding management action plans to the existing monitoring of progress related to internal audit engagement findings. Verification that recommendations identified during the external assessment have been implemented is communicated to the board as part of the internal audit function's monitoring of progress. Developing a quality assurance and improvement program (QAIP) that covers all aspects of the internal audit function. Recommendations to address areas that were not in conformance with the Standards.
a)
1 and 2 only.
b)
3 and 4 only.
c)
1, 2, and 3 only.
d)
1, 2, 3, and 4.
48.
Providing action plans to address recommendations from an external assessment of the internal audit function is the responsibility of
a)
Line management.
b)
The audit committee.
c)
The board of directors.
d)
The chief audit executive.
49.
Corrective action plans may result from an assessor's recommendations made during an external assessment of the internal audit function. Which of the following is true?
a)
Verification that the recommendations have been implemented may be communicated to the board by following up separately through the next internal assessment.
b)
Corrective action plans consist of a comprehensive self-assessment process that emphasizes the full external assessment and is validated by an external assessor.
c)
Indicating that the internal audit function conforms with the Standards is appropriate only if supported by the implementation of corrective action plans.
d)
The corrective action plans are included in the organization's internal audit charter.
50.
Which of the following statements is true regarding the conclusion by an assessor of the internal audit function in accordance with a quality assurance and improvement program (QAIP)?
a)
The conclusion is an expression of an opinion on the results of the internal assessment.
b)
The external assessor is on the results of an external (not internal) assessment.
c)
The scope and frequency of the internal and external assessments should be included in the CAE's disclosure to senior management and the board regarding the results of the QAIP.
d)
During an external assessment, the assessor may provide recommendations to address (a) areas that were not in conformance with the Standards and (b) opportunities for improvement. The CAE may provide management action plans to address the recommendations.
51.
A quality assurance and improvement program (QAIP) covers all aspects of the internal audit function. The conclusion by an assessor of the internal audit function is most likely to include
a)
An overall assessment of conformance with attribute but not performance elements.
b)
The qualifications and independence of the assessment team.
c)
A rating scale used to show the degree of conformance.
d)
An overall assessment of overall conformance.
52.
A financial institution's internal audit function is undergoing an external quality assessment. The assessment team has identified that the function only partially conforms to the Standards due to deficiencies in audit documentation processes. How should the CAE respond to ensure continuous improvement?
a)
Dismiss the findings because they do not affect the overall audit quality.
b)
Develop an action plan to address the documentation deficiencies and present it to the board for approval.
c)
Conduct an internal reassessment to confirm the assessment team's findings before taking any action.
d)
Focus on completing the remaining audit plan for the year, deferring the documentation improvements to the next cycle.
53.
During an internal audit at a hospital, the internal audit function was revealed not to be performing external assessments as required by the Standards. The chief audit executive (CAE) claims budget constraints and staffing shortages as reasons for this lapse. What is the most ethically appropriate action by the CAE?
a)
Document the reasons for nonconformance and communicate them to the board.
b)
Proceed with a self-assessment internally without involving an independent party because of the budget constraints.
c)
Postpone further assessments until the hospital's financial situation improves.
d)
Reduce the scope of internal audit engagements to offset the costs of an external assessment.
54.
As part of an external assessment, the assessment team discovers that the internal audit function has a significant deficiency in its audit methodologies. What is the most appropriate action for the CAE?
a)
Document the finding but do not report it to senior management if it does not affect current audit outcomes.
b)
Immediately update the audit methodologies and then send to the board to review the change.
c)
Delay reporting the deficiency to senior management until the next annual board meeting to avoid alarming them.
d)
Deferring improvements may lead to repeated problems and potential noncompliance.
55.
At ProTech, Inc., the CAE is preparing for an external quality assessment. Which of the following is most important to ensure the assessment's independence?
a)
Selecting assessors from the internal audit team.
b)
Engaging a former employee with internal audit experience.
c)
Choosing an independent assessor with no conflicts of interest.
d)
Using current external financial statement auditors.
56.
An internal auditor in an IT organization is performing a periodic self-assessment of the internal audit function. What is a key focus area to ensure the internal audit function supports the organization's objectives?
a)
Review of auditor qualifications and certifications.
b)
Verification of compliance with IT security policies.
c)
Assessment of how audit activities reflect organizational strategies.
d)
Analysis of the internal audit budget allocation.
57.
A new CAE at a logistics organization is ensuring that the internal audit function conforms with The IIA's Standards. What is the initial step to prepare a strong foundation for this objective?
a)
Developing a comprehensive risk assessment.
b)
Conducting training sessions on audit software tools.
c)
Establishing clear communication channels with the board and senior management.
d)
Increasing the frequency of internal audits across all departments.
58.
An internal audit function at a multinational organization performed an internal assessment and found that its internal audit reports are not effectively influencing management's decision making. What strategy should the function adopt to increase the influence of its reports?
a)
Focus on creating more detailed and lengthy reports.
b)
Relate the report content to strategic business objectives.
c)
Limit the number of recommendations in each report.
d)
Increase the technical complexity of the report language.
59.
The internal audit function at a manufacturer has discovered through a QAIP assessment that its audit reports are not being acted upon by management. What should the CAE do to ensure audit findings are implemented?
a)
Increase the frequency of internal audits.
b)
Develop a communication plan to engage with management.
c)
Shorten the length of audit reports.
d)
Conduct audits without reporting findings.
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