IIA-CFSA Online Practice Questions and Answers

Which of the following statements is NOT related to competency principle of internal auditing? Internal auditors:

A. Shall continually improve their proficiency and effectiveness and quality of their services

B. Shall perform internal auditing services in accordance with the standards for the professional practice of internal auditing

C. Shall engage only in those services for which they have the necessary knowledge, skills and experience

D. Shall disclose all material facts known to them that, if not disclosed, may distort the reporting of activities under review

Trust departments provide services to publicly held companies related to issuing and maintaining:

A. Stock transactions

B. Stock balances

C. Stock threshold

D. None off these

Cash equivalent may include:

A. Commercial Papers

B. Returned Checks

C. Spotted debits

D. Only A and B

The reliability (competence) of evidence gathered by auditors is a __________. The reliability of evidence is a key factor in the audit analysis. Relevance is also a key factor in determining the quality of evidence.

A. Fixed term

B. Variable

C. Determinant

D. Subjective philosophy

Strategic Risk if not properly controlled, understood or measured may result in:

A. High Earnings volatility

B. Significant capital pressures

C. Withdrawal of loan portfolios by the customers

D. Only AandB

Banks that performs variety of services for other bank, e.g. they make emergency loans to banks that are short of cash and clear cheques that are drawn and paid out by different banks are called:

A. Community Banks

B. Regional Banks

C. Federal Reserve Banks

D. Credit unions

Deposit in many banks are insured by the ______________, which ensure that depositors will get their money back up to a stated limit, if a bank should fail:

A. Financial Deposit Insurance Corporation

B. Federal Deposit Insurance Corporation

C. Federal Deposits and Investment committee

D. None of these

A manufacturer wants to protect the company from financial loss resulting from third-party lawsuits. The manufacturer has learned of several recent jury awards over $7 million for product defects. The manufacturer currently has only $5 million in this type of coverage. The manufacturer has also learned that several automobile claims have been recently awarded against other company's cars in accidents over $1 million. The manufacturer has damaged his competition and the manufacturer wants to protect his company further than the current policy allows. What insurance coverage product will the manufacturer likely buy?

A. A personal injury protection (PIP) policy to protect others from personal injury

B. An umbrella policy to place a protective umbrella over existing coverage.

C. A surplus lines policy to protect against claims in surplus of the policy limits.

D. A floater policy to float coverage where needed.

The time that a new group member must wait before becoming eligible to enroll in a group insurance plan is known as the:

A. Actively-at-work provision

B. Probationary period

C. Eligible period

D. Enrollment period

Annuities can be purchased through the following methods EXCEPT:

A. Single payment deferred

B. Periodic payment deferred

C. Immediate payment

D. Single payment accrued