February 2020 Internal Auditor Quiz
Internal Auditor is helping you earn CPE credits to support your IIA certifications. Each bi-monthly quiz is worth one (1) CPE credit with a score of 80 percent or higher. Internal Auditor quizzes are NOT NASBA certified.
- 1.
According to “Bringing Clarity to the Foggy World of AI,” by Kevin M. Alvero and Wade Cassels, which of the following technologies is not considered to be artificial intelligence (AI)?
- A.
Deep learning.
- B.
Machine learning.
- C.
Natural language processing.
- D.
Robotic process automation.
Correct Answer
D. Robotic process automation. -
- 2.
According to “Bringing Clarity to the Foggy World of AI,” internal audit should ask whether the organization’s AI strategy was developed collaboratively between business and technology leaders.
- A.
True
- B.
False
Correct Answer
A. True -
- 3.
According to “Bringing Clarity to the Foggy World of AI,” because big data forms the foundation of AI capability, internal audit should:
- A.
Ensure that management and the board understand how AI will impact the organization’s goals.
- B.
Pay special attention to the organization’s data governance structure.
- C.
Review whether AI uses data ethically and complies with privacy regulations.
- D.
Work with IT to develop analytics capabilities
Correct Answer
B. Pay special attention to the organization’s data governance structure. -
- 4.
According to “On the Money: Time to Revisit Financial Risk,” by Brendan Scott, when rising trade tensions combine with high levels of corporate debt, internal auditors should:
- A.
Determine how prepared the organization is to weather a trade war.
- B.
Pay particular attention to financial governance.
- C.
Scrutinize all aspects of financial risk, as earnings may be under pressure.
- D.
Watch for signs that financial risk management standards are slipping.
Correct Answer
C. Scrutinize all aspects of financial risk, as earnings may be under pressure. -
- 5.
According to “On the Money: Time to Revisit Financial Risk,” 30% of chief audit executives surveyed in Risk in Focus 2020 rate financial risk as their organization’s top risk.
- A.
True
- B.
False
Correct Answer
B. False -
- 6.
According to “On the Money: Time to Revisit Financial Risk,” FTSE 100 construction rental business Ashstead reported a £4 billion increase in net debt in September 2019, most of which was attributed to:
- A.
IFRS 9
- B.
IFRS 12
- C.
IFRS 15
- D.
IFRS 16
Correct Answer
D. IFRS 16 -
- 7.
In Louis Seabrooke and Amy Felix's "A Study in Risk Tolerance," which term describes "the level of control the CRA has over this risk"?
- A.
Criticality.
- B.
Maturity.
- C.
Base profile.
- D.
Span of control.
Correct Answer
D. Span of control. -
- 8.
In "A Study in Risk Tolerance" by Louis Seabrooke and Amy Felix, because the organization is fully tolerant of any risk, the tool applies a base factor uniformly to all risks by giving 0 points out of a possible 20 points.
- A.
True
- B.
False
Correct Answer
B. False -
- 9.
In Russell Jackson's "Forming Today's Internal Audit Function," Stacey Schabel notes several facets to consider when determining what skills your audit team needs. Check all that apply.
- A.
Audit needs assessment requirements, such as ratings and cyclicality.
- B.
Business objectives and key risks to accomplishing them.
- C.
Future vision — if it’s digital advancement, for example, internal audit may need specific new expertise.
- D.
Organizational and regulatory changes and focus areas.
Correct Answer(s)
A. Audit needs assessment requirements, such as ratings and cyclicality.
B. Business objectives and key risks to accomplishing them.
C. Future vision — if it’s digital advancement, for example, internal audit may need specific new expertise.
D. Organizational and regulatory changes and focus areas. -
- 10.
As stated in “A Voice in the Boardroom,” what percentage of time do audit departments spend on financial risk?
- A.
10%
- B.
20%
- C.
30%
- D.
50%
Correct Answer
B. 20% -
- 11.
Why do many CAEs lack credibility, according to Dotty Hayes in “A Voice in the Boardroom”?
- A.
They tend to emphasize box-ticking.
- B.
They lack an extensive background in the profession.
- C.
They haven’t spent enough time building relationships with board members.
- D.
Their boards are biased against internal audit.
Correct Answer
A. They tend to emphasize box-ticking. -
- 12.
In “A Voice in the Boardroom,” which IIA standard does Karen Brady point to as especially important for CAEs to implement when seeking credibility with the board?
- A.
Standard 1111: Direct Interaction With the Board.
- B.
Standard 1210: Proficiency.
- C.
Standard 1230: Continuing Professional Development.
- D.
Standard 1312: External Assessments.
Correct Answer
D. Standard 1312: External Assessments. -
- 13.
In “A Plan for Regulatory Change,” what guidance does author Nancy Haig say the top-down regulatory framework she provides is based on?
- A.
U.S. Federal Sentencing Guidelines.
- B.
COSO’s Enterprise Risk Management–Integrated Framework.
- C.
ISO 31000.
- D.
None of the above.
Correct Answer
A. U.S. Federal Sentencing Guidelines. -
- 14.
As discussed in “A Plan for Regulatory Change,” what fines are organizations that fail to comply with the European Union’s General Data Protection Regulation subject to?
- A.
10% of worldwide turnover.
- B.
Up to 4% of worldwide turnover.
- C.
Between $5 million and $10 million.
- D.
Between $1million and $5 million.
Correct Answer
B. Up to 4% of worldwide turnover. -
- 15.
Per a survey cited in “A Plan for Regulatory Change,” what percentage of retail executives expect privacy regulations to have a moderate to significant impact on their business?
- A.
25%.
- B.
50%.
- C.
75%.
- D.
90%.
Correct Answer
C. 75%. -
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