2026 ExamcollectionPass IIA IIA-CIA-Part2 Dumps and Exam Test Engine
IIA IIA-CIA-Part2 DUMPS WITH REAL EXAM QUESTIONS
IIA-CIA-Part2 exam contains 100 multiple-choice questions and has a time limit of two and a half hours. IIA-CIA-Part2 exam covers four domains: Managing the Internal Audit Function, Planning the Engagement, Performing the Engagement, and Communicating Engagement Results and Monitoring Progress. Candidates must score a minimum of 600 points out of a possible 750 to pass the exam.
NEW QUESTION # 98
An internal auditor noticed that employees with responsibilities for cash collection had recently issued an unusually large number of credit memos, indicating that the original charges had been made to the wrong customer accounts. From a control standpoint, the auditor would be concerned with the possibility that:
- A. Credit memos are not being submitted on a timely basis.
- B. Employees in this function are concealing a theft of cash collected from customers.
- C. The credit department has not been properly screening customers and, as a result, a large portion of the accounts receivable may not be collectible.
- D. The organization is selling a large number of defective items.
Answer: B
Explanation:
Section: Volume C
Explanation/Reference:
NEW QUESTION # 99
A chief audit executive (CAE) following up on action plans from previously completed audits identifies that management has determined that certain action plans are no longer necessary If the CAE disagrees with management's decision, which of the following is the most appropriate next step for the CAE to take?
- A. The CAE must discuss the matter with legal counsel
- B. The CAE must discuss the matter with key shareholders
- C. The CAE must discuss the matter with senior management
- D. The CAE must discuss the matter with the board
Answer: D
Explanation:
If the Chief Audit Executive (CAE) disagrees with management's decision to deem certain action plans no longer necessary, the CAE must discuss the matter with the board. The board has the ultimate responsibility for oversight of the internal audit function and for ensuring that management addresses audit recommendations appropriately. Escalating the issue to the board ensures that the CAE fulfills their duty to report significant issues and disagreements to those charged with governance.
Reference:
The Institute of Internal Auditors (IIA) Standard 2600 - Communicating the Acceptance of Risks: "When the chief audit executive believes that senior management has accepted a level of residual risk that may be unacceptable to the organization, the chief audit executive must discuss the matter with senior management. If the decision regarding residual risk is not resolved, the chief audit executive must report the matter to the board for resolution."
NEW QUESTION # 100
The following is an excerpt from an audit engagement workpaper:
A Company
Accounts Receivable
Date
Objective. To determine if the computer system is correctly recording all accounts receivable transactions.
Procedures: Judgmental selection of a sample of all accounts receivable balances greater than $50,000 for positive confirmation of balances.
Conclusion: Based on the results of testing wherein all but three confirmations were returned, the accounts receivable balance is fairly presented in all material respects.
Which of the following is true regarding the workpaper?
- A. It is not appropriate to judgmentally select a sample when testing accounts receivable.
- B. The audit procedures used are not consistent with the audit objective.
- C. The format of the workpaper does not conform to the standard format for workpapers.
- D. A conclusion should be reached only for the results of overall testing, not for individual procedures.
Answer: B
NEW QUESTION # 101
Which of the following audit steps would be most effective to review proper recording of and accountability over physical assets?
1. Physically inspect all assets on the organization's property.
2. Select a sample department and physically inspect assets in the department.
3. Select a sample from the organization's records of physical assets and physically locate each asset.
4. Identify assets at a sample of locations and trace to the organization's records.
- A. III and IV only
- B. I only
- C. I and IV only
- D. II and III only
Answer: A
NEW QUESTION # 102
A technology firm's internal audit function is slated to perform a series of engagements assessing the security of its software development processes. To successfully perform these engagements, which competency should the internal audit function possess?
- A. Proficiency in using design software
- B. Expertise in IT general controls
- C. Understanding of change management processes
- D. Fluency in multiple programming languages
Answer: C
Explanation:
Comprehensive and Detailed Explanation:
Software development security requires internal auditors to understand change management processes (B) - how updates, patches, and new code are introduced and controlled to prevent vulnerabilities. While IT general controls (A) are important, they are broader (e.g., access, backup, operations). Fluency in programming languages (D) and proficiency in design software (C) are too technical and unnecessary for audit. Instead, auditors need to understand how changes are authorized, tested, and implemented, ensuring that the development process follows security and governance standards. According to Standard 1210 - Proficiency, internal auditors must have or obtain sufficient knowledge to evaluate relevant risks, making change management competency most critical.
NEW QUESTION # 103
Which of the following statements regarding the use of external contracted services by the chief audit executive (CAE) is false?
- A. The expert should be directed by the objectives and scope of work.
- B. The audit report should not disclose the use of contracted services.
- C. The CAE's responsibility is not impaired by engaging an external expert.
- D. The external expert could have a prior relationship with the audit client.
Answer: B
NEW QUESTION # 104
An IT auditor is reviewing the access controls in an organization's accounting application. The auditor intends to deploy a tool that can help test the logical controls embedded in the system to ensure employee access is granted according to need. Which of the following would help achieve this objective?
- A. Utility software
- B. Generalized audit software
- C. integrated test facility
- D. Audit expert systems.
Answer: B
Explanation:
Generalized audit software (GAS) is designed to assist auditors in performing data analysis and testing the logical controls embedded within information systems. This type of software can help an IT auditor review access controls by analyzing user permissions, access logs, and other relevant data to ensure that access is granted according to the principle of least privilege and organizational policies. GAS tools are versatile and can handle large volumes of data, making them suitable for testing logical controls in an accounting application.References:
* The Institute of Internal Auditors (IIA) - Global Technology Audit Guide (GTAG) 1: Information Technology Controls
NEW QUESTION # 105
An internal auditor is assessing the organization's risk management framework. Which of the following formulas should he use to calculate the residual risk?
A)
B)
C)
D)
- A. Option B
- B. Option A
- C. Option D
- D. Option C
Answer: A
NEW QUESTION # 106
Which phase of an audit engagement is typically the most effective time for an internal auditor to develop a risk and control matrix?
- A. At planning, to assist in developing the engagement work program.
- B. At sample selection, to determine sampling methodology.
- C. At the start of fieldwork, as part of developing the annual audit plan.
- D. When preparing to recap audit test results.
Answer: A
Explanation:
The most effective time for an internal auditor to develop a risk and control matrix is during the planning phase of an audit engagement. This matrix helps in identifying the key risks and the controls in place to mitigate those risks, which is crucial for developing a focused and effective engagement work program.
IIA Reference:
IIA Standard 2201: Planning Considerations requires internal auditors to consider significant risks and controls when planning the engagement. Developing a risk and control matrix at this stage ensures that the audit work is appropriately targeted at the most critical areas.
The Practice Guide on Risk Assessment advises that creating a risk and control matrix during planning helps in structuring the audit to address identified risks effectively.
NEW QUESTION # 107
Which of the following is most likely to be judged as a significant residual risk that would exceed the organization's acceptable risk level?
- A. Any risk involving investments into bitcoin and suspicious derivatives
- B. Any risk that could cause injuries or pollute the environment
- C. Any risk that can cause material or financial loss
- D. Any risk involving organizational expansion into a new geographical area with an unstable political environment.
Answer: B
Explanation:
A significant residual risk that would exceed the organization's acceptable risk level is likely to be one that has severe consequences, such as causing injuries or environmental pollution. These types of risks can have substantial legal, financial, and reputational impacts on an organization and are typically beyond acceptable levels of risk tolerance. Reference:
COSO's Enterprise Risk Management - Integrating with Strategy and Performance.
The IIA's Practice Guide on Risk Management.
NEW QUESTION # 108
According to IIA guidance, which of the following is true regarding the exit conference for an internal audit engagement?
- A. A primary purpose of the exit conference is to provide for the timely communication of observations that call for immediate management action.
- B. During the exit conference, the performance of the internal auditors who executed the engagement is reviewed.
- C. Both the chief audit executive and the chief executive over the activity or function reviewed must attend the exit conference to validate the findings.
- D. The exit conference provides only anticipated results for inclusion in the final audit communication.
Answer: D
Explanation:
Section: Volume E
NEW QUESTION # 109
The most common motivation for management fraud is the existence of:
- A. Financial pressures on the organization.
- B. Job dissatisfaction.
- C. The challenge of committing the perfect crime.
- D. Vices, such as a gambling habit.
Answer: A
Explanation:
Section: Volume A
NEW QUESTION # 110
Production managers for a manufacturing company are authorized to prepare emergency purchase orders for raw materials. These manually prepared orders do not go through the purchasing department and do not require a receiving report. The managers forward the invoice and purchase order to the accounting department for payment. Which of the following internal controls would efficiently prevent abuse of this system?
- A. Review the level of safety stock.
- B. Forbid the use of emergency purchase orders.
- C. Require a manual receiving report from the warehouse prior to payment.
- D. Institute a company policy requiring rotation of orders among several suppliers.
Answer: C
Explanation:
Section: Volume C
NEW QUESTION # 111
An organization recently acquired a subsidiary in a new industry, and management asked the chief audit executive (CAE) to perform a comprehensive audit of the subsidiary prior to recommencing operations The CAE is unsure her team has the necessary skills and knowledge to accept the engagement According to IIAguidance, which of the following responses by the CAE would be most appropriate?
- A. The CAE should ask management to hire an external expert who is familiar with the industry to perform an independent audit for management
- B. The CAE should accept the engagement and hire an external expert to assist the audit team with the audit of the subsidiary
- C. The CAE should recommend postponing the engagement until the internal audit team is able to develop sufficient knowledge of the new industry
- D. The CAE should accept the engagement and ensure that an explanation of the expertise limitations is included in the final audit report.
Answer: B
Explanation:
According to IIA guidance, if the internal audit team lacks the necessary skills and knowledge to perform an audit, the CAE should consider obtaining external expertise. Accepting the engagement and hiring an external expert allows the internal audit activity to leverage specialized knowledge while fulfilling the audit request.
This approach ensures that the audit is conducted effectively and meets the required standards, while also addressing any competency gaps within the internal audit team.
Institute of Internal Auditors (IIA) Standards: Attribute Standards 1210: Proficiency IIA Practice Guide: Obtaining External Assistance in the Conduct of Internal Auditing
NEW QUESTION # 112
While preparing the annual audit plan, the newly assigned chief audit executive (CAE) learns that the organization has not yet implemented a risk framework. Which of the following would be the most appropriate action for the CAE to take regarding potential engagements?
- A. Use the previous three-year audit plan to extrapolate potential engagements for the upcoming year's schedule of engagement.
- B. Consult with senior management and the board and make adjustments regarding risk.
- C. Prioritize the engagements that were not done in previous years and schedule them for the upcoming year.
- D. Review all outstanding recommendations from prior audit engagements and focus on them in the upcoming year.
Answer: B
NEW QUESTION # 113
The chief audit executive established an internal audit activity (IAA) performance standard requiring all audit reports to be issued within 48 hours of the exit meeting with the client. Which of the following describes an exit meeting strategy that would best help the IAA meet this performance standard?
- A. The objective of the exit meeting is to reach agreement on audit observations.
- B. The objective of the exit meeting is to confirm understanding of audit results
- C. The objective of the exit meeting is to solicit action plans for audit observations.
- D. The objective of the exit meeting is to confirm final details of fieldwork.
Answer: B
Explanation:
Section: Volume D
NEW QUESTION # 114
According to IIA guidance, which of the following are potential benefits of using an assurance map?
- A. Indication of any gaps in assurance coverage, and improved relevance of assurance recommendations.
- B. Enhanced effectiveness of assurance providers, and improved relevance of assurance recommendations.
- C. Indication of gaps in assurance coverage, and enhanced effectiveness of assurance providers.
- D. Identification of duplicate or overlapping assurance activities, and improved relevance of assurance recommendations.
Answer: C
NEW QUESTION # 115
Why is an ICQ more suitable for evaluating how subsidiaries apply procurement rules compared to other methods like direct observation or interviews?
- A. The auditor wants to gain assurance that inventory counts are conducted in accordance with established procedures.
- B. The auditor wants to receive mid-level management insight on how to improve hiring practices.
- C. The auditor wants to assess whether different subsidiaries apply centrally established procurement rules in the same manner.
- D. The auditor wants to obtain information on whether adherence to approval matrices is actually taking place in different maintenance units.
Answer: C
Explanation:
An internal control questionnaire (ICQ) is best used to assess whether different subsidiaries apply centrally established procurement rules in the same manner because it helps gather structured responses from different units regarding their compliance with established policies.
* Receiving mid-level management insight on hiring practices (A) is better suited for interviews or surveys.
* Verifying adherence to approval matrices (B) requires observation and transactional testing rather than a questionnaire.
* Gaining assurance on inventory counts (C) would involve direct observation and reconciliation rather than an ICQ.
Reference:IIA's Practice Guide: Internal Audit and Fraud Risk Management - Use of Questionnaires in Control Assessments.
NEW QUESTION # 116
An internal auditor notes that employees continue to violate segregation-of-duty controls in several areas of the finance department, despite previous audit recommendations. Which of the following recommendations is the most appropriate to address this concern?
- A. Recommend additional segregation-of-duty reviews.
- B. Recommend appropriate awareness training for all finance department staff.
- C. Recommend rotating finance staff in this area.
- D. Recommend that management address these concerns immediately.
Answer: B
Explanation:
When employees continue to violate segregation-of-duty controls despite previous recommendations, the most effective approach is to recommend appropriate awareness training. This training can help employees understand the importance of these controls and how to comply with them, addressing the root cause of the violations. Reference: = IIA Standard 2130 - Control and IIA Practice Guide: "Auditing Segregation of Duties".
NEW QUESTION # 117
A large retail organization, which sells most of its products online, experiences a computer hacking incident.
The chief IT officer immediately investigates the incident and concludes that the attempt was not successful.
The chief audit executive (CAE) learns of the attack in a casual conversation with an IT auditor. Which of the following actions should the CAE take?
1. Meet with the chief IT officer to discuss the report and control improvements that will be implemented as a result of the security breach, if any.
2. Immediately inform the chair of the audit committee of the security breach, because thus far only the chief IT officer is aware of the incident.
3. Meet with the IT auditor to develop an appropriate audit program to review the organization's Internet-based sales process and key controls.
4. Include the incident in the next quarterly report to the audit committee.
- A. 2 and 4
- B. 1 and 3
- C. 3 and 4
- D. 1 and 2
Answer: D
NEW QUESTION # 118
......
IIA-CIA-Part2 or the Practice of Internal Auditing exam is one of the most important exams for individuals seeking to become certified internal auditors. IIA-CIA-Part2 exam is designed to test the candidate's knowledge of internal auditing concepts, practices, and principles. The IIA-CIA-Part2 exam is divided into three sections, each covering different aspects of internal auditing such as risk management, governance, and communication.
2026 New ExamcollectionPass IIA-CIA-Part2 PDF Recently Updated Questions: https://www.examcollectionpass.com/IIA/IIA-CIA-Part2-practice-exam-dumps.html
IIA-CIA-Part2 Exam with Guarantee Updated 709 Questions: https://drive.google.com/open?id=1av2Q5yqc9Jg8sJ_Qm4RStJmP--jqtURu