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Certified Internal Auditor® (CIA®) Sample Exam Questions​

Part 1 Sample Exam Questions
  •   According to the International Professional Practices Framework, the independence of the internal audit activity is achieved through:
    1. Staffing and supervision.
    2. Continuing professional development and due professional care.
    3. Human relations and communications.
    4. Organizational status and objectivity.

    View answer
    1. Incorrect. Staffing and supervision relate to the professional proficiency of the internal audit activity.
    2. Incorrect. Continuing professional development and due professional care relate to the professional proficiency of the internal auditor.
    3. Incorrect. Human relations and communications relate to the professional proficiency of the internal auditor.
    4. Correct. According to Practice Advisory 1110-1, organizational status and objectivity permit members of the internal audit activity to render the impartial and unbiased judgments essential to the proper conduct of engagements.
  •   Two internal auditors left the internal audit department who cannot be immediately replaced due to budget constraints. Which of the following is the least desirable option for efficiently completing future engagements, given this reduction in resources?
    1. Using self-assessment questionnaires to address audit objectives.
    2. Employing information technology in audit planning, sampling, and documentation.
    3. Eliminating consulting engagements from the engagement work schedule.
    4. Filling vacancies with personnel from operating departments that are not being audited.

    View answer
    1. Incorrect. Self-assessment questionnaires are a means of efficiently addressing the objectives of certain internal audits.
    2. Incorrect. Use of technology is an appropriate means of achieving efficiencies in audit execution.
    3. Correct. The audit schedule should only be reduced as a last resort once all other viable alternatives have been explored, including the request for additional resources.
    4. Incorrect. Using operating personnel with internal audit interest and corporate experience is an appropriate way to enhance internal audit resources.
  •   Which of the following fraudulent entries is most likely to be made to conceal the theft of an asset?
    1. Debit expenses, and credit the asset.
    2. Debit the asset, and credit another asset account.
    3. Debit revenue, and credit the asset.
    4. Debit another asset account, and credit the asset.

    View answer
    1. Correct. Most fraud perpetrators would attempt to conceal their theft by charging it against an expense account.
    2. Incorrect. Debiting the stolen asset account would be going in the wrong direction to conceal an asset theft.
    3. Incorrect. An entry decreasing revenue would be unusual and would stand out.
    4. Incorrect. This entry would not permanently conceal the fraud. It would simply shift the irreconcilable balance to another asset account.
Part 2 Sample Exam Questions
Part 3 Sample Exam Questions
  •   A means of limiting production delays caused by equipment breakdown and repair is to:
    1. Schedule production based on capacity planning.
    2. Plan maintenance activity based on an analysis of equipment repair work orders.
    3. Pre-authorize equipment maintenance and overtime pay.
    4. Establish a preventive maintenance program for all production equipment.

    View answer
    1. Incorrect. Scheduling production based on capacity utilization ignores other important factors such as demands.
    2. Incorrect. Budgeting maintenance department activities based on previous work orders will not prevent equipment breakdowns. and repairs.
    3. Incorrect. Standing authorizations of work orders and overtime will not address the problem posed.
    4. Correct. A preventive maintenance program will reduce equipment breakdowns and repairs.
  •   If a country uses trade quotas to overcome chronic trade deficits, the most likely outcome would be that:
    1. Unemployment and productivity rates will rise.
    2. Unemployment rates will rise and productivity rates will decline.
    3. Unemployment rates will decline and productivity rates will rise.
    4. Unemployment and productivity rates will decline.

    View answer
    1. Incorrect. See answer "D".
    2. Incorrect. See answer "D".
    3. C. Incorrect. See answer "D".
    4. Correct. With trade quotas, home jobs will be saved; hence, unemployment will decline. Since jobs will be saved for inefficient industries (less efficient than foreign competitors), productivity rates will decline because they will not be specializing in those goods with which they have a comparative advantage.
  •   The difference between the required rate of return on a given risky investment and that of a risk-free investment with the same expected return is the:
    1. Risk premium.
    2. Coefficient of variation.
    3. Standard error of measurement.
    4. Beta coefficient.

    View answer
    1. Correct. The risk premium is the portion of expected return attributed to the increased risk.
    2. Incorrect. The coefficient of variation represents the standard deviation of an investment's returns divided by the mean returns.
    3. Incorrect. The standard error represents a measure of variability in the investment's returns.
    4. Incorrect. The beta coefficient represents the sensitivity of the investment's returns to the market returns.
  •   Which of the following would be of greatest concern to an auditor reviewing a policy regarding the sale of a company’s used personal computers to outside parties?
    1. Whether deleted files on the hard disk drive have been completely erased.
    2. Whether the computer has viruses.
    3. Whether all software on the computer is properly licensed.
    4. Whether there is terminal emulation software on the computer.

    View answer
    1. Correct. While most delete programs erase file pointers, they do not remove the underlying data. The company must use special utilities that fully erase the data. This is important because of the potential for confidential data on the microcomputers.
    2. Incorrect. This could create a liability for the company if a virus destroyed the purchasing party’s data or programs. However, the purchasing party should use anti-virus software to detect and eliminate any viruses. This concern, while important, is not as serious as the one in answer “A”.
    3. Incorrect. The purchasing party has a responsibility to insure that all their software is properly licensed. If the company represented that all the software was properly licensed, this could create a liability. However, this liability is not as serious as the implication from answer “A”.
    4. Incorrect. Terminal emulation software is widely available.
Part 4 Sample Exam Questions

Candidates from the following countries must refer to their local IIA Institute web-site or contact their local representative for more information about local certification processes:

The information contained on this website pertains to all other countries.

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