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NEW QUESTION # 13
Refer to the exhibit.
If the profit margin of an organization decreases, and all else remains equal, which of the following describes how the "Funds Needed" line in the graph below will shift?
- A. The "Funds Needed" line will point downward with an extreme slope.
- B. The "Funds Needed" line will remain pointed upward, but will become less steep.
- C. The "Funds Needed" line will remain pointed upward, but will become more steep.
- D. The "Funds Needed" line will point downward with a minimal slope.
Answer: C
NEW QUESTION # 14
Which of the following is a limiting factor for capacity expansion?
- A. Lack of credible market leader in the industry.
- B. Government pressure on organizations to increase or maintain employment.
- C. Company diversification.
- D. Production orientation of management.
Answer: C
NEW QUESTION # 15
According to Porter, which of the following is associated with fragmented industries?
- A. Weak entrance barriers.
- B. Strong negotiation power with suppliers.
- C. Significant scale economies.
- D. Steep experience curve.
Answer: A
NEW QUESTION # 16
During the last year, an organization had an opening inventory of $300,000, purchases of $980,000, sales of
$1,850,000, and a gross margin of 40 percent. What is the closing inventory if the periodic inventory system is used?
- A. $170,000
- B. $540,000
- C. $300,000
- D. $280,000
Answer: A
NEW QUESTION # 17
When is an organic organizational structure likely to be more successful than a mechanistic organizational structure?
- A. When a manufacturer has reliable resources and suppliers
- B. When an organization is subjected to strong political and social pressures
- C. When an organization is infrequently affected by technological advances
- D. When a manufacturing organization has stable demand for its products.
Answer: C
NEW QUESTION # 18
For an engineering department with a total quality management program, important elements of quality management include all of the following except:
- A. Basing performance evaluations on the number of projects completed.
- B. Conducting post-project surveys on performance.
- C. Comparing results with those of other engineering departments.
- D. Creating a quality council within the engineering department.
Answer: A
NEW QUESTION # 19
The audit committee of a global corporation has mandated a change in the organization's business ethics policy. Which of the following approaches describes the best way to accomplish the policy's diffusion worldwide?
- A. Introduce the policy region by region, using any lessons learned to change the subsequent version of the policy for the next area.
- B. Consult with legal and operational management in each affected country to ensure the final version can be implemented globally, following audit committee approval.
- C. Send the board-approved version of the policy to each country's senior leadership and empower them to tailor the policy to the local language and culture.
- D. Deploy the policy in the corporate headquarters' language, so everyone gets an unfiltered version simultaneously.
Answer: B
NEW QUESTION # 20
An organization allows employees to use mobile devices for business purposes.
Which of the following could cause decreased employee productivity in case of data loss?
- A. Lack of data encryption.
- B. Lack of data back up.
- C. Malware resulting in data leakage.
- D. Exposure of sensitive data.
Answer: B
NEW QUESTION # 21
Multinational organizations generally spend more time and effort to identify and evaluate:
- A. Internal strengths and weaknesses.
- B. Break-even points.
- C. Internal risk factors.
- D. External trends and events.
Answer: D
NEW QUESTION # 22
Which of the following is the best example of a compliance risk that is likely to arise when adopting a bring-your-own-device (BYOD) policy?
- A. The risk that smart devices can be lost or stolen due to their mobile nature.
- B. The risk that an organization intrusively monitors personal information stored on smart devices.
- C. The risk that proprietary information is not deleted from the device when an employee leaves.
- D. The risk that users try to bypass controls and do not install required software updates.
Answer: B
NEW QUESTION # 23
The economic order quantity for inventory is higher for an organization that has:
- A. A higher purchase price per unit of inventory.
- B. Higher fixed inventory ordering costs.
- C. Lower annual unit sales.
- D. Higher annual carrying costs as a percentage of inventory value.
Answer: B
NEW QUESTION # 24
An internal auditor performed a review of IT outsourcing and found that the service provider was failing to meet the terms of the service level agreement. Which of the following approaches is most appropriate to address this concern?
- A. The organization should work with the service provider to review the current agreement and expectations relating to objectives, processes, and overall performance.
- B. The organization should ensure that there is a clear management communication strategy and path for evaluating and reporting on all outsourced services concerns.
- C. The organization should proactively monitor the performance of the service provider, escalate concerns, and use penalty clauses in the contract where necessary.
- D. The organization should review the skill requirements and ensure that the service provider is maintaining sufficient expertise and retaining skilled resources.
Answer: C
NEW QUESTION # 25
Which audit approach should be employed to test the accuracy of information housed in a database on an un-networked computer?
- A. Use a test program to simulate the normal data entering process.
- B. Select a sample of records from the database and ensure it matches supporting documentation.
- C. Submit batches of test transactions through the current system and verify with expected results.
- D. Evaluate compliance with the organization's change management process.
Answer: B
NEW QUESTION # 26
An internal auditor reviewed Finance Department records to obtain a list of current vendor addresses The auditor then compared the vendor addresses to a record of employee addresses maintained by the Payroll Department Which of the following types of data analysis did the auditor perform?
- A. Gap analysis
- B. Joining data sources
- C. Classification
- D. Duplicate testing.
Answer: B
NEW QUESTION # 27
Which of the following statements best describes the frameworks set forth by the International Standards Organization?
- A. Bridging the gaps among control requirements, technical issues, and business risks.
- B. Practical guidance and benchmarks for all organizations that use information systems.
- C. Frameworks and guidance on enterprise risk management, internal control, and fraud deterrence.
- D. Globally accepted standards for industries and processes.
Answer: D
NEW QUESTION # 28
A large hospital has an existing contract with a vendor in another country to provide software support and maintenance of the hospital's patient records information system. From the hospital management's perspective, which of the following controls would be most effective to address privacy risks related to this outsourcing arrangement?
- A. Conduct periodic reviews of the privacy policy to ensure that the existing policy meets current legislation requirements in both regions.
- B. Include a "right to audit" clause in the contract and impose detailed security obligations on the outsourced vendor
- C. Develop an incident monitoring and response plan to track breaches from internal and external sources
- D. Implement mandatory privacy training for management to help with identifying privacy risks when outsourcing services
Answer: B
NEW QUESTION # 29
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IIA-CIA-Part3-3P is a certification exam offered by the Institute of Internal Auditors (IIA) that focuses on Business Knowledge for Internal Auditing. IIA-CIA-Part3-3P exam is designed to test the knowledge and understanding of individuals who work in the field of internal auditing, particularly those who specialize in business knowledge. Passing IIA-CIA-Part3-3P exam is an important step for individuals who want to advance their careers in internal auditing and demonstrate their expertise in this area.
IIA-CIA-Part3-3P exam is recognized globally, and passing this certification exam demonstrates the candidate's proficiency in internal auditing and business knowledge. CIA Exam Part Three: Business Knowledge for Internal Auditing certification is highly valued by employers in the field of internal auditing and provides a competitive edge to the certified professionals. It also opens up new career opportunities and increases the chances of being promoted to higher positions.
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