NEW QUESTION 1

The most important reason to use risk assessment in audit planning is to:

• A. Identify redundant controls.
• B. Improve budgeting accuracy.
• C. Enhance assurance provided to management.
• D. Assist in developing audit programs.

Answer: C

NEW QUESTION 2

An organization requires an average of 58 days to convert raw materials into finished products to sell. An average of 42 additional days is required to collect receivables. If the organization takes an average of 10 days to pay for the raw materials, how long is its total cash conversion cycle?

• A. 26 days.
• B. 90 days.
• C. 100 days.
• D. 110 days.

Answer: B

NEW QUESTION 3

During which phase of the contacting process ate contracts drafted for a proposed business activity?

• A. Initiation phase
• B. Bidding phase
• C. Development phase
• D. Management phase

Answer: A

NEW QUESTION 4

A supervisor receives a complaint from an employee who is frustrated about having to learn a new software program. The supervisor responds that the new software will enable the employee to work more efficiently and with greater accuracy. This response is an example of:

• A. Empathetic listening.
• B. Reframing.
• C. Reflective listening.
• D. Dialogue.

Answer: B

NEW QUESTION 5

When applied to international economics, the theory of comparative advantage proposes that total worldwide output will be greatest when:

• A. Each nation's total imports approximately equal its total exports.
• B. Each good is produced by the nation that has the lowest opportunity cost for that good.
• C. Goods that contribute to a nation's balance-of-payments deficit are no longer imported.
• D. International trade is unrestricted and tariffs are not imposed.

Answer: B

NEW QUESTION 6

A department purchased one copy of a software program for internal use. The manager of the department installed the program on an office computer and then made two complete copies of the original software.
Copy 1 was solely for backup purposes.
Copy 2 was for use by another member of the department.
In terms of software licenses and copyright law, which of the following is correct?

• A. Both copies are legal.
• B. Only copy 1 is legal.
• C. Only copy 2 is legal.
• D. Neither copy is legal.

Answer: B

NEW QUESTION 7

Which of the following is useful for forecasting the required level of inventory?
* 1. Statistical modeling.
* 2. Information about seasonal variations in demand.
* 3. Knowledge of the behavior of different business cycles.
* 4. Pricing models linked to seasonal demand.

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

Answer: C

NEW QUESTION 8

The economic order quantity for inventory is higher for an organization that has:

• A. Lower annual unit sales.
• B. Higher fixed inventory ordering costs.
• C. Higher annual carrying costs as a percentage of inventory value.
• D. A higher purchase price per unit of inventory.

Answer: B

NEW QUESTION 9

Which of the following actions is most likely to gain support for process change?

• A. Set clear objectives.
• B. Engage the various communities of practice within the organization.
• C. Demonstrate support from senior management.
• D. Establish key competencies.

Answer: B

NEW QUESTION 10

Which of the following should be established by management during implementation of big data systems to enable ongoing production monitoring?

• A. Key performance indicators
• B. Reports of software customization
• C. Change and patch management
• D. Master data management

Answer: A

NEW QUESTION 11

Which of the following is true regarding the COSO enterprise risk management framework?

• A. The framework categorizes an organization's objectives to distinct, non overlapping objectives.
• B. Control environment is one of the framework's eight components.
• C. The framework facilitates effective risk management, even if objectives have not been established.
• D. The framework integrates with, but is not dependent upon, the corresponding internal control framework.

Answer: D

NEW QUESTION 12

Which of the following methods is most closely associated to year over year trends?

• A. Horizontal analysis
• B. Vertical analysis
• C. Common-size analysis
• D. Ratio analysis

Answer: A

NEW QUESTION 13

Which of the following is a characteristic of an emerging industry?

• A. Established strategy of players.
• B. Low number of new firms.
• C. High unit costs.
• D. Technical expertise.

Answer: C

NEW QUESTION 14

Which of the following would provide the most relevant assurance that the application under development will provide maximum value to the organization?

• A. Use of a formal systems development lifecycle.
• B. End-user involvement.
• C. Adequate software documentation.
• D. Formalized non-regression testing phase.

Answer: B

NEW QUESTION 15

Which of the following statements is true regarding an organization's inventory valuation1?

• A. The valuation will be incorrect it the inventory includes goods m transit shipped free on board (FOB) destination to another organization
• B. The valuation will be correct if the inventory includes goods received on consignment from another organization
• C. The valuation will be incorrect it the inventory includes goods in transit shipped FOB shipping point from another organization
• D. The valuation will be correct it the inventory includes goods sent on consignment to anotherorganization

Answer: B

NEW QUESTION 16

Which of the following is a characteristic of using a hierarchical control structure?

• A. Less use of policies and procedures
• B. Less organizational commitment by employees
• C. Less emphasis on extrinsic rewards
• D. Less employees turnover

Answer: B

NEW QUESTION 17

In terms of international business strategy, which of the following is true regarding a multi-domestic strategy?

• A. It uses the same products in all countries.
• B. It centralizes control with little decision-making authority given to the local level.
• C. It is an effective strategy when large differences exist between countries.
• D. It provides cost advantages, improves coordinated activities, and speeds product development.

Answer: C

NEW QUESTION 18

Which of the following statements accurately describes one of the characteristics that distinguishes a multinational company from a domestic company?

• A. A multinational company has stockholders in other countries.
• B. A multinational company exports its products to other countries.
• C. A multinational company operates outside of its country of origin.
• D. A multinational company uses raw materials and components from more than one country.

Answer: C

NEW QUESTION 19

The board has requested that the internal audit activity be involved in all phases of the organization's outsourcing of its network management. During which of the following stages is the internal auditor most likely to verify that the organization's right-to-audit clause is drafted effectively?

• A. Implementation and transition phase.
• B. Monitoring and reporting phase
• C. Decision-making and business-case phase.
• D. Tendering and contracting phase.

Answer: D

NEW QUESTION 20

An organization is considering mirroring the customer data for one regional center at another center. A disadvantage of such an arrangement would be:

• A. Lack of awareness of the state of processing.
• B. Increased cost and complexity of network traffic.
• C. Interference of the mirrored data with the original source data.
• D. Confusion about where customer data are stored.

Answer: B

NEW QUESTION 21
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