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NEW QUESTION 35

For a bank handling large amounts of cash, which of the following types of control would be the most effective to use?

  • A. Detective controls.
  • B. Preventive controls.
  • C. Corrective controls.
  • D. Directive controls.

Answer: B

Explanation:

Section: Volume D

NEW QUESTION 36

An organization receives the most value from an internal audit activity's enterprise-wide risk assessment when the auditor:

  • A. Reviews special projects and new initiatives.
  • B. Considers activities at all levels of the organization.
  • C. Focuses primarily on enterprise-level risks.
  • D. Validates supporting financial and operational data.

Answer: B

NEW QUESTION 37

An automobile manufacturer will become one of the first in the industry to adopt a new inventory management software. Despite the system being new to the market, senior management believes that the benefits are great enough to offset the potential risks. Which of the following aspects of risk management does senior management's decision best illustrate?

  • A. Risk appetite.
  • B. Residual risk.
  • C. Risk tolerance.
  • D. Inherent risk.

Answer: C

NEW QUESTION 38

An internal auditor wants to use ratio analysis to examine efficiencies in an organization's accounting department. Which of the following statements identifies a weakness of ratio analysis that should be considered by the auditor?

  • A. It requires a substantial investment of money.
  • B. It utilizes financial information that may not have been checked for validity and reliability.
  • C. Computer software is required in order to draw conclusions from the data.
  • D. It is only helpful for making comparisons across industries.

Answer: B

NEW QUESTION 39

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