When developing the scope of an audit engagement, which of the following would the internal auditor typically not need to consider?

• A. The operational and geographic boundaries.
• B. The potential impact of key risks.
• C. The expected outcomes and deliverables.
• D. The need and availability of automated support.

An internal auditor discovered that equipment used to monitor air quality was not maintained according to the established maintenance schedule. If the issue is not addressed, the equipment may not provide accurate information on pollutant levels, which could result in regulatory sanctions and reputational damage. The auditor discussed the issue with both the manager in charge and the CEO, who explained that they understand the risk, but it has become too expensive to maintain the equipment as scheduled. In this situation, what should the chief audit executive do?

• A. Communicate to the board the current situation, including the risk exposure to the organization.
• B. Contact the regulatory agency and inform them of the risk exposure.
• C. Discuss the matter with external auditors and request that they persuade management to address the issue.
• D. Add value to the organization by taking initiative and implementing corrective actions to mitigate the identified risks.

An internal auditor s testing tor proper authorization of contracts and finds that the rate of deviations discovered in the sample is equal to the tolerable deviation rate. When of the following is the most appropriate conclusion for the internal auditor to make based on this result?

• A. The internal auditor concludes that the specified control is more effective than it really is.
• B. The internal auditor concludes that management may be placing undue reliance on me specified control
• C. The internal auditor concludes that additional testing will be required to evaluate the specified control
• D. The internal auditor concludes that the specified control is acceptably effective

When a significant finding is noted early during a review of the accounts payable function, which next course of action is best for communicating the issue?

• A. Alert the CEO as soon as the issue is discovered
• B. Note the item in the workpapers for inclusion in the final audit report
• C. Call a meeting and discuss me issue with the audit committee
• D. Intern accounting management via an interim memorandum update

Due to a recent system upgrade, an audit is planned to test the payroll process. Which of the following audit objectives would be most important to prevent fraud?

• A. Verify that amounts are correct.
• B. Verify that recipients are valid employees.
• C. Verify that benefits deductions are accurate.
• D. Verify that payments are on time.