Free IIA-CIA-Part1 Practice Test Questions 2026

Which of the following is an example of a risk avoidance strategy?

A. Outsourcing the payroll function

B. Installing cameras in the mailroom

C. Exiting a product line

D. Insuring all fixed assets

Which of the following is an example of risk monitoring to ensure a system is performing as intended?

A. Checking the progress of risk treatment plans

B. Considering the consequence and likelihood of risks

C. Documenting the risks and their areas of impact

D. Communicating to management about risks

The chief audit executive (CAE) annually develops a budget and resource plan and submits it to the board for approval. This action best fulfills which of the following responsibilities of the CAE?

A. The responsibility to maintain organizational independence.

B. The responsibility to perform engagements with due professional care.

C. The responsibility to communicate corrective action plans to the board.

D. The responsibility to define the purpose of the internal audit activity.

An internal auditor at a multinational organization is reviewing the effectiveness of the organization's risk management framework. In this scenario, which of the following statements is true?

A. The auditor should consider local cultures and customs in various regions when assessing control effectiveness.

B. Regardless of their location, employees at all levels share responsibility for designing effective controls to mitigate risks.

C. To achieve an effective internal control environment, the organization's risk management plan must be documented and communicated to all levels throughout each region.

D. Setting clear objectives is a precondition to effectively identifying, assessing, and responding to the organization's risks.

Senior management has decided to adopt the key principles approach of the ISO 31000 risk management framework. According to IIA guidance, which of the following principles is most appropriate when implementing the risk management process in a dynamic agency?

A. Everyone in the agency has a primary responsibility for identifying and managing risks as part of the risk management process.

B. The risk management process, while evaluating risk, should develop a mechanism to rank the relative importance of each risk.

C. The risk management process should be regularly reviewed and respond to changes in the environment, to remain relevant.

D. The risk management process should use a formal technique to consider the consequence and likelihood of each risk.

During an assurance engagement an internal auditor discovered that risk limits risk limit were set for a new market expansion project Management of the area under review was eager to comply and submitted a potential risk limit value for the auditor's review and approval. Which of the following would be an appropriate course of action for the auditor to take?

A. Review the submission and if no further remarks exist approve the risk limits

B. Provide advice if needed and ask management of the area under review to forward to senior management and the board for approval

C. Develop risk limit calculation criteria and ask management of the area under review to resubmit the values.

D. Avoid providing any advice or review until the audit report is issued

According to IIA guidance, which of the following statements is true regarding consulting engagements performed by the internal audit activity?

A. Consulting engagements typically involve four or five parties: the internal audit activity, engagement client, senior management, board, and sometimes the external auditor.

B. The scope of a consulting engagement is determined by either the engagement supervisor or chief audit executive, and it is finalized prior to beginning fieldwork.

C. According to the Standards, internal auditors are permitted to carry out certain management functions during a consulting engagement.

D. A preliminary risk assessment may not be needed for consulting engagements, because the expectations and objectives of the engagement are determined by the engagement client.

Recently an organization’s internal audit activity discovered ghost employees who receive payments Senior management decides to strengthen the internal control measures to address this Which of the following is considered an effective control to mitigate payments to ghost employees?

A. Staff transfers are reviewed by the recruiting manager and approved by the head of human resources

B. New staff requisition forms are authorized by operational management and acknowledged by the head of human resources

C. Staff salary payments and accounting records are approved by the head of accounting and acknowledged by the head of human resources

D. The staff salary payment list is reviewed by the head of payroll and endorsed by the head of human resources

Which of the following is most likely to be considered a control weakness?

A. Vendor invoice payment requests are accompanied by a purchase order and receiving report.

B. Purchase orders are typed by the purchasing department using prenumbered forms.

C. Buyers promptly update the official vendor listing as new supplier sources become known.

D. Department managers initiate purchase requests that must be approved by the plant superintendent.

Which of the following risk management techniques best describes the strategy of obtaining insurance to protect against losses due to bad weather conditions?

A. Risk avoidance

B. Risk reduction

C. Risk acceptance

D. Risk sharing

A chief audit executive (CAE) recruited a few new internal auditors to reduce the resource gaps identified in this year's internal audit plan. One of the new recruits has several years of experience with the organization. Ten months ago. she served as a senior supervisor in the finance department. However, for the past 10 months, she has been helping the organization with implementing a new IT system. What approach should the CAE take for the upcoming financial statement controls audit?

A. Assign the new auditor to assist with conducting the fieldwork. but ensure that her work is reviewed by the CAE.

B. Assign the new auditor to assist with developing the audit program, but ensure that the audit program is executed by other audit staff.

C. Ensure that the new auditor's previous manager, and other close former coworkers, are excused during the audit.

D. Ensure that the new auditor is responsible only for the supervisory review, but not the execution of the audit field work.

Upon completion of an external assessment as part of the quality assurance and improvement program (QAIP), the chief audit executive (CAE) reported the results to senior management and the board The CAE included the following elements in the report

- Qualifications and independence of me external assessment team

- Conclusions of assessors

- Corrective action plans

How should the CAE improve the aforementioned approach to reporting the resets of QAIP?

A. Senior management should be excluded from the reporting as the QAiP results must be communicated to re board only

B. The report can be streamlined by removing unnecessary information such as the qualifications and me independence of external assessors

C. The results must be snared with the external a auditors as well, so they can determine the extent to which they can rely on me work of the internal audit activity

D. The report should indicate that the external assessment must be performed at least once every five years