An internal audit activity has made a preliminary determination that a division of the organization has employed improper accounting practices.
Upon being informed, the head of the organization instructs the chief audit executive (CAE) to cease the investigation and to withhold the information from external auditors.
Which course of action should the CAE follow?

• A.Report the communication to the organization's general counsel.
• B.Inform the head of the organization that the investigation will continue as planned.
• C.Report the instruction to the chairperson of the audit committee.
• D.Inform the external auditors of the findings and the mandate to stop investigating.

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During the planning phase of an audit of suspected overbilling on contracts for security services, an internal auditor should perform all of the following except:

• A.Prepare an engagement program.
• B.Obtain a copy of the contract between the two organizations.
• C.Interview an official of the security services company to determine the cause of recent increases in billings for services.
• D.Interview the manager who requested the audit engagement.

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What conclusion can be reached by comparing a random sample of vendor invoices to purchase orders?

• A.No duplicate invoices were received.
• B.No duplicate payments were made.
• C.Invoices were for authorized purchases.
• D.Authorized invoices were paid.

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An internal auditor has been engaged to assess fraud risks associated with a new financial software system.
Which competency would best help the auditor complete the task?

• A.A thorough understanding of organizational governance principles.
• B.Expertise in identifying information technology risks.
• C.Proficiency in creating and utilizing process maps.
• D.Knowledge of key management and business principles.

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Which of the following would provide the best assessment of an organization's ethical climate?

• A.Frequency of fraud reported and results of subsequent investigations.
• B.Number of years that directors have been appointed to the board.
• C.Clarity and consistency of consequences imposed by the board of directors for ethical violations.
• D.Evidence of training provided to the board of directors on ethical issues.

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