SOLVED

Learning Objective 26-1 1) Internal Auditors are expected to add value to the organization through improved operational effectiveness. In addition, their responsibilities include all the following except: A) reviewing the reliability and integrity of information. B) ensuring compliance with the company’s accounting policies. C) verifying accounting information for external users. D) ensuring compliance with applicable governmental regulations. 2) Statements on Internal Auditing Standards are issued by the: A) AICPA. B) SEC. C) Internal Auditing Standards Boards. D) Auditing Standards Boards. 3) Internal auditors are responsible to: A) the board of directors. B) management. C) both A and B. D) neither A nor B. 4) Which of the following is not a similarity between external and internal auditors? A) Both must be independent of the company. B) Both must be competent. C) Both follow a similar methodology in performing their audits. D) Both consider risk and materiality deciding the extent of their tests and evaluating results. 5) External auditors would consider internal auditors effective if they are: A) independent of the operating units being evaluated. B) competent and well trained. C) have performed relevant audit tests of the internal controls and financial statements. D) all of the above. 6) Which of the following is most correct regarding external auditors use of internal auditors directly on the audit engagement? A) discourage B) prohibit C) encourage D) permit 7) The international standards for the professional practice of internal auditing include which two categories of standards? A) attribute and performance B) competency and professional skepticism C) performance and integrity D) ethics and rules of conduct 8) The professional organization which is responsible for providing guidance for internal auditors is the: A) APA. B) IIA. C) ABA. D) AIA. 9) An audit conducted in accordance with the Yellow Book must include an audit report that states the audit was performed in accordance with: A) GAAS. B) GAGAS. C) GASA. D) SAS. 10) External financial statement auditors must obtain evidence regarding what attributes of an internal audit department if the external auditors intend to rely on the internal auditor’s work? A) Independence from the Audit Committee Competence Yes Yes B) Independence from the Audit Committee Competence No No C) Independence from the Audit Committee Competence Yes No D) Independence from the Audit Committee Competence No Yes 1