Free IIA-CIA-Part1 Practice Test Questions 2026

Which of the following situations is most likely to heighten an internal auditor's professional skepticism regarding potential fraud?

A. A procurement manager does not have the expected academic credentials for his position.

B. A salesperson frequently complains about the organization's policy on sales commissions.

C. The accounts payable supervisor has requested advances against her monthly salary on several occasions.

D. A financial accountant is absent from work frequently due to regular medical procedures.

Management assessed the organization’s risk of expanding operations into a new, but volatile, region and began looking for a compatible local partner to manage sales and distribution. Which of the following best describes this risk management technique?

A. Avoidance.

B. Acceptance.

C. Reduction.

D. Sharing

The internal audit activity conducted an organization wide risk assessment. One of the most significant risks identified is associated with the oil price market. The chief audit executive (CAE) is considering including in the annual audit plan an assessment of the effectiveness of oil price risk management. The manager responsible commented that the assessment was not needed, as market risks were regularly addressed by the financial risk committee. If the CAE decides to include this activity in the annual audit plan anyway, how should it be recorded?

A. A consulting engagement independent of the financial risk committee's review.

B. A risk assessment.

C. An assurance engagement.

D. A joint consulting engagement with input from the financial risk committee.

Which of the following resources would be most effective for an organization that would like to improve how it informs stakeholders of its social responsibility performance?

A. ISO 26000.

B. Global Reporting Initiative.

C. Open Compliance and Ethics Group.

D. COSO’s enterprise risk management framework

What would be the proper sequence of steps for an internal auditor to take in order to draw a conclusion on internal control effectiveness and adequacy after ascertaining the key controls?

A. Evaluate the adequacy of the controls and then test the controls for effectiveness.

B. Test the controls for effectiveness and then evaluate the adequacy of the controls.

C. Identify risks and then evaluate the controls for effectiveness.

D. Evaluate the controls for effectiveness and then assess the risks in the area.

An internal auditor notes that inventory counts are conducted on Mondays only and that all documentation is on paper as there are no computers in the underground warehouses. Also she notices that the person responsible for receiving the goods is the same one who distributes materials and spare parts Finally, she sees that spare parts are written off and taken by the heads of mining units to different underground locations to wait for their turn to be installed. Which of the described findings requires more consideration from a fraud risk perspective?

A. The job responsibilities of the warehouse employee compromise segregation of duties

B. Spare parts are written off before their actual usage and installation

C. Warehouse management is conducted on paper and requires further investigation

D. The inventory counts take place on specific days of the week for no apparent reason

The chief audit executive of an organization assigns audit resources to undertake a consulting engagement requested by senior management the previous year, and a scheduled assurance audit of the procurement process Which of the following appropriately differentiates the two engagements?

A. The details of assurance services are expected to be included in the risk-based audit plan; this is not the case for consulting services.

B. The objectivity of assurance services is impaired when undertaken by internal auditors who have had recent prior responsibility in the area under review; this is not the case for consulting services

C. The performance of assurance services may be outsourced for competency gaps: this is not the case for consulting services.

D. The results of assurance services are required to be monitored; this is not the case for consulting services

An internal audit activity uses a rotational program to recruit high-performing staff members from other parts of the organization One of these individuals is nearing the end of her fouryear internal audit rotation The chief audit executive assigned her to an assurance engagement in the business area she will be going into when she leaves the internal audit activity Which of the following statements is true regarding this scenario?

A. Accepting the assignment is a violation of internal audit independence

B. Accepting the assignment will improve competencies and develop relationships that will be needed in her next assignment

C. Accepting the assignment creates the appearance of an impairment to her professional judgment and detectivity

D. Accepting the assignment on the assurance engagement would be a breach of due professional care

An engagement supervisor obtains facilities maintenance reports from a contractor during an audit of third-party services. Which of the following is the source of authority for the engagement supervisor to make such contact outside the organization?

A. The policies and procedures of the internal audit activity.

B. The provisions of the internal audit charter.

C. The authority of the CEO.

D. The IIA's Code of Ethics.

An accounts payable clerk who has access to the vendor master file replaced the payment details of a legitimate vendor with those of a friend before processing the payment through the organization's cashier. Immediately afterward, he restored the original vendor information. Which of the following controls could have prevented this fraud?

A. Approval of master file change requests by the accounts payable supervisor

B. Comparison of the check register to original invoices.

C. Segregation of duties between accounts payable and the cashier.

D. Frequent issuance of account statements sent to the vendors.

Due to unfavorable economic conditions management decided to postpone new investments for the next year. Which of the following best describes the risk management strategy used to address this situation?

A. Risk mitigation

B. Risk avoidance

C. Risk reduction

D. Risk transfer

Which of the following best demonstrates the application of due professional care?

A. An engagement supervisor requests that the employment of a process owner be terminated due to a significant control failure.

B. An audit lead establishes internal audit manuals to guide the internal audit activity on now to undertake audit engagements.

C. An audit manager provides a guarantee to senior management that internal controls relating to an audited process operate effectively.

D. An organization's internal audit activity operates under a direct reporting structure to tie audit committee of the board