Preview Questions Internal Auditor | Role Specific Skill

Question 1: Which of the following best describes the relationship between risk and return in risk management?

Which action should you take?

Choose only one option

Higher risk always leads to higher returns

Lower risk always leads to lower returns

Risk and return are unrelated concepts

Higher risk may lead to higher returns but also increases the likelihood of loss

Question 2: In the context of a compliance audit, what should be the primary focus when reviewing an institution's adherence to the Foreign Account Tax Compliance Act (FATCA)?

Which action should you take?

Choose only one option

Verifying the institution's tax filings for accuracy

Assessing the institution's customer satisfaction levels

Ensuring the institution reports foreign assets and income in accordance with FATCA requirements

Evaluating the institution's compliance with local environmental regulations

Question 3: What is the primary goal of an internal audit's risk-based approach in assessing internal controls?

Which action should you take?

Choose only one option

To limit audit resources to specific departments only

To audit every control equally without prioritization

To focus on the most significant risks and prioritize testing of controls based on their potential impact

To primarily evaluate operational costs

Question 4: What is the main goal of performing a "scenario analysis" in risk management?

Which action should you take?

Choose only one option

To assess the competency of internal auditors

To calculate the financial performance of the organization

To evaluate the financial impact of various potential future events

To identify new business opportunities

Question 5: How does an internal auditor evaluate the effectiveness of an organization's cybersecurity controls?

Which action should you take?

Choose only one option

By assessing the cyber risk management strategy, penetration testing results, and incident response plans

By monitoring only the login credentials of employees

By reviewing the company's cybersecurity budget alone

By conducting a general IT systems audit without focusing on security

Question 6: In the context of internal controls, what does "control risk" refer to?

Which action should you take?

Choose only one option

The risk of fraudulent activities by management

The risk of external events disrupting business operations

The risk that internal controls will fail to prevent or detect material misstatements

The risk of an employee misusing company resources