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NEW QUESTION 39
A manufacturer uses a materials requirements planning (MRP) system to track inventory,orders,and raw materials requirements. What condition should an auditor search for in the MRP database if a preliminary assessment indicated that inventory is understated?
I.Item cost set at zero.
II.Negative quantities on hand.
III.Order quantity exceeding requirements.
IV.Inventory lead times exceeding delivery schedule.

A. I and IVonlyB. II and IVonlyC. I and IIonlyD. III and IVonly

Answer: C

 

NEW QUESTION 40
A chief audit executive ensures that the internal audit activity provides annual training to management on internal controls. Where is the nature of these services defined?

A. The audit report.B. The annual audit plan.C. The audit charter.D. The annual risk assessment.

Answer: C

 

NEW QUESTION 41
Which of the following would best describe a control implemented to detect cash register disbursement fraud in a large retail store?

A. Post signs in the register area prompting customers to ask for and examine their sales receiptsB. Periodically count the cash in the register and compare it to the expected amountC. Separate the duties of processing and authorizing refunds on merchandiseD. Use cash registers with internal tapes that are tamper proof and that require a manager to process voids or refunds

Answer: B

 

NEW QUESTION 42
Which of the following is most likely to be an element of an effective compliance program?

A. The organization obtains as much information as possible when performing background checks on employees.B. The internal audit activity is assigned responsibility for overseeing the program.C. The program is communicated to employees in a video format on a one-time basis.D. The organization uses monitoring systems designed to detect improper activity.

Answer: D

Explanation:
Section: Volume B

 

NEW QUESTION 43
......

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