Free IIA-CIA-Part2 Practice Test Questions 2026

An internal audit activity maintains a quality assurance and improvement program that includes annual self-assessments The internal audit activity includes in each engagement report a clause that the engagement is conducted in conformance with the International Standards for the Professional Practice of Internal Auditing (Standards). Which of the following justifies inclusion of this clause in the reports?

A. Internal audit activity policies and engagement records provide relevant, sufficient, and competent evidence that the statement is correct.

B. The audit committee has reviewed the annual self-assessment results and approved the use of the clause.

C. The self-assessment results were validated by a qualified external review team three years prior.

D. The internal audit charter, approved by the audit committee, requires conformance with the Standards

A corporate merger decision prompts the cruel audit executive (CAE) to propose interim changes lo the existing annual audit plan to account for emerging risks. When of the following is the most appropriate action for the CAE to take regarding the changes made to the audit plan?

A. Present the revised audit plan directly to the board for approval

B. Communicate with the chief financial officer and present the revised audit plan to the CEO for approval

C. Present the revised audit plan directly to the CEO for approval

D. Communicate with the CCO and present the revised audit plan to the board for approval

A code of business conduct should include which of the following to increase its deterrent effect?

1. Appropriate descriptions of penalties for misconduct.

2. A notification that code of conduct violations may lead to criminal prosecution.

3. A description of violations that injure the interests of the employer.

4. A list of employees covered by the code of conduct.

A. 1 and 2

B. 1 and 3

C. 2 and 4

D. 3 and 4

Which of the following would be the most helpful to a chief audit executive when developing a talent management strategy?

A. Gap analysis

B. Staff preferences

C. Maturity analysis

D. Extent of external audit coverage

When presenting an observation m writing which or the Mowing is usually true regarding the level of detail provided?

1. The description of the observation in the final audit report contains more detail then the description m the engagement workpapers

2. The description of the observation m the engagement workpapers contains more detail than the descriptor n a preliminary observation document

3. A preliminary observation document contains more detail than tie observation description in the final audit report

4. A preliminary observation document contains more detail than tie observation description in the engagement workpapers

A. 1 and 2

B. 1 and 4

C. 2 and3

D. 3 and 4

Which of the following factors would the auditor in charge be least likely to consider when assigning tasks to audit team members for an engagement?

A. The amount of experience the auditors have conducting audits in the specific area of the organization.

B. The availability of the auditors in relation to the availability of key client staff.

C. Whether the budgeted hours are sufficient to complete the audit within the current scope.

D. Whether outside resources will be needed, and their availability.

An internal auditor determines that certain information from the engagement results is not appropriate for disclosure to all report recipients because it is privileged. In this situation, which of the following actions would be most appropriate?

A. Disclose the information in a separate report.

B. Distribute the information in a confidential report to the board only

C. Distribute the reports through the use of blind copies.

D. Exclude the results from the report and verbally report the conditions to senior management and the board.

At a construction company, an internal auditor is planning an audit of the company's process for designing and building grid connections The process involves customers making payments m three parts

• The first payment of 10% after approval of the customer s application

• The second payment of 70% prior to construction

• The third payment of 20% after construction is complete

Which of the following key controls should the auditor test to ensure that the company is not taking any unwanted credit risks?

A. Controls that ensure that grid connection design is finalized before construction is approved to begin

B. Controls that ensure construction orders are initiated after the second invoice is paid

C. Controls that ensure all three invoices are calculated correctly according to the total project cost

D. Controls that ensure that applications are verified for approval prior to initiating design and construction

According to IIA guidance, which of the following is true regarding audit supervision?

1. Supervision should be performed throughout the planning, examination, evaluation, communication, and follow-up stages of the audit engagement.

2. Supervision should extend to training, time reporting, and expense control, as well as administrative matters.

3. Supervision should include review of engagement workpapers, with documented evidence of the review.

A. 1 and 2 only

B. 1 and 3 only

C. 2 and 3 only

D. 1, 2, and 3

If there is a significant error or omission in the final audit report that was communicated to management, which of the following is the key action for the internal audit activity?

A. Communicate the corrected information to the manager of the audited department.

B. There should be a follow-up audit to address the error or omission.

C. The auditor should update the scope of the audit to include the omission.

D. The corrected communication should be redistributed to the original recipients.

Which of the following is the primary reason to develop an audit work program?

A. To alert operational management to the types of audit tests that will likely be performed.

B. To help the engagement team understand which tasks have to be performed and how.

C. To assist with communicating all relevant audit findings, conclusions, and recommendations to operational management.

D. To facilitate the supervision of the audit engagement and enable the chief audit executive to provide relevant feedback.

For an action plan to be effective, it should be designed primarily to address which of the following elements of an observation?

A. Condition

B. Root cause

C. Criteria

D. Recommendation