According to the International Professional Practices Framework, Which of the Following

question 465

Multiple Choice

According to the International Professional Practices Framework, which of the following is correct regarding conducting and reporting follow-up activities by the internal audit activity (IAA) ?

• A) Due to management changes, the IAA is advised by management that no further work will be done. Further follow-up work is not required as management has accepted the related risk.
• B) A newly appointed auditor immediately proceeds to conduct follow-up testing based on previous work performed for the engagement and then reports the results to the chief audit executive (CAE).
• C) Management has stopped implementing several key recommendations citing a growing disagreement with their effectiveness. The auditor communicates the situation to the CAE who then escalates the matter to senior management.
• D) In situations where the identified risk may have a significant impact to the business and senior management has accepted the risk, it is not necessary for the CAE to inform the board of the decision.

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Definitions:

High Failure Rate

A situation where a significant number of attempts or initiatives do not meet the intended objectives or outcomes.

New Businesses

Refers to newly established companies or startups that enter the market to offer products or services.

High Failure Rate

A high failure rate indicates a situation or context where a significant percentage of attempts or operations do not reach their intended outcome or goal.

New Businesses

The act of founding, starting, and nurturing new companies or ventures.