With Regard to External Assessments of an Internal Audit Activity

question 186

Multiple Choice

With regard to external assessments of an internal audit activity (IAA) , which of the following is the chief audit executive required to discuss with the board?

• A) External reviewer conflicts of interest, and the need for an external assessment more frequently than once every five years.
• B) External reviewer conflicts of interest, and the timeline of the external assessment.
• C) The need for an external assessment more frequently than once every five years, and the simplest method for the external reviewer to join the IAA's organization.
• D) The simplest way for the external reviewer to join the IAA's organization, and the timeline of the external assessment.

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Definitions:

Audit Function

The process of examining financial records and transactions by a third party to ensure accuracy and compliance with accounting standards.

Financial Statements

Comprehensive reports created to present a company's financial performance, financial position, and cash flows over a specific period.

Audit Report

A formal statement issued by an auditor at the conclusion of an audit process, summarizing their opinion on an entity's financial statements.

Retained Earnings

The portion of net income not distributed as dividends but retained by the company for reinvestment or to pay debt.