Which of the following should be the primary objective of an audit of an entity's business continuity plan?

• A.Cost of testing and updating the plan.
• B.Delegation of responsibilities for the plan.
• C.Relationship of the plan to risk exposures.
• D.Efficiency of the planning procedures.

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Which of the following reporting relationships results in the greatest impairment to the independence of the chief audit executive (CAE)?

• A.The CAE reports administratively and functionally to the president.
• B.The CAE reports administratively to the chief financial officer and functionally to the president.
• C.The CAE reports administratively to the president and functionally to the board.
• D.The CAE reports administratively to the audit committee and functionally to the chief operating officer.

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Which of the following statements best describes the competency requirement for an auditor regarding fraud risks encountered in an engagement execution?

• A.The auditor should be able to have comparable competencies of a person whose primary responsibility is detecting and investigating fraud.
• B.The auditor must have sufficient knowledge to evaluate the risk of fraud and the manner in which it is managed by the organization.
• C.The auditor is not expected to have any competency requirement regarding fraud since the role of investigating and detecting fraud belongs to other functions in the organization.
• D.The auditor must be able to have an appreciation of the fundamentals of fraud detection and investigation techniques.

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An internal auditor is testing whether payments to outside contractors have been charged to the proper account. Which of the following sampling methods would be most useful in completing this task?

• A.Attribute sampling.
• B.Judgmental sampling.
• C.Haphazard sampling.
• D.Probability-proportional-to-size sampling.

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When using a risk assessment model to develop audit plans, it is essential that the chief audit executive take into account the:

• A.Results of the last audit.
• B.Planned visits by the external auditors during the upcoming year.
• C.Recent or expected changes in management direction and objectives.
• D.Dates of future board meetings.

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