An organization has developed a large database that tracks employees, employee benefits, payroll deductions, job classifications, and other similar information. In order to test whether data currently within the automated system are correct, an auditor should:

• A.Use generalized audit software to provide a printout of all employees with invalid job descriptions. Investigate the causes of the problems.
• B.Use generalized audit software to select a sample of employees from the database. Verify the data fields.
• C.Use test data and determine whether all the data entered are captured correctly in the updated database.
• D.Select a sample of data to be entered for a few days and trace the data to the updated database to determine the correctness of the updates.

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Auditors 1,2,and 3 work out of various offices. Each must be assigned to one,and only one,of three audit locations (A,B,or C). The cost of sending each auditor to each location is listed below: Audit Locations
Auditor 1 A B
Auditor 2 $200 $300 $400
Auditor 3 $400 $300 $600
Auditor 4 $200 $200 $500
The minimum cost with which this assignment can be accomplished is:

• A.$900
• B.$1,000
• C.$1,100
• D.$800

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Which of the following control methods is effective in reducing the risk of purchasing-scheme fraud?
Periodically reviewing the vendor list for unusual vendors and addresses.
Segregating duties for amount purchasing, receiving, shipping, and accounting.
Validating sequential integrity of purchase orders.
Verifying the validity of invoices with post office box addresses.

• A.1 and 2 only
• B.1,2,3,and 4
• C.1,2,and 4 only
• D.3 and 4 only

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Which of the following is the first step in the process of identifying relevant fraud risk factors?

• A.Identifying preventive and detective controls
• B.Gathering information about the organization's business activities to gain an understanding of fraud risks
• C.The use of brainstorming, management interviews, analytical procedures and review of prior frauds.
• D.Engaging in strategic reasoning to anticipate the fraud scheme

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After being terminated due to downsizing, an internal auditor finds a different job with an organization in the same industry. Which of the following actions would violate the IIA Code of Ethics?

• A.At the new organization, the auditor is asked to develop forms to implement probability-proportional-to- size sampling. Although unsure of how to perform this type of sampling, the auditor proceeds without asking for assistance.
• B.In preparing for an audit at the previous organization, the auditor had conducted a great deal of research on the Internet at home to identify best practices for the management of a treasury function.
  The auditor has retained much of the research and uses it to conduct an audit of the new employer's treasury function.
• C.In the first week at the new organization, the auditor discovers a high fraud risk surrounding the organization's database and suggests that the information technology department implement a new password system to prevent fraudulent actions before they occur.
• D.To determine audit priorities in the new job, the auditor uses the audit risk approach that the auditor's previous employer used, without receiving permission to do so.

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