[Oct 27, 2025] Get Unlimited Access to IIA-CIA-Part3 Certification Exam Cert Guide [Q99-Q121]

Q99. An internal audit activity is piloting a data analytics model, which aims to identify anomalies in payments to vendors and potential fraud indicators Which of the following would be the most appropriate criteria for assessing the success of the piloted model?

Q100. An organization has a total asset turnover of 3.0 times and a total debt-to-total assets ratio of 80 percent. If the organization has total debt of $1 000 000 what is the organization’s sales level?

Q101. The cost to enter a foreign market would be highest in which of the following methods of global expansion?

Q102. A large retail customer made an offer to buy 10.000 units at a special price of $7 per unit. The manufacturer usually sells each unit for §10, Variable Manufacturing costs are 55 per unit and fixed manufacturing costs are
$3 per unit. For the manufacturer to accept the offer, which of the following assumptions needs to be true?

Q103. In a large organization, the biggest risk in not having an adequately staffed information center help desk is:

Q104. Which audit approach should be employed to test the accuracy of information housed in a database on an un-networked computer?

Q105. At an organization that uses a periodic inventory system, the accountant accidentally understated the organization s beginning inventory. How would the accountant’s accident impact the income statement?

Q106. Which of the following principles is shared by both hierarchical and open organizational structures?
A superior can delegate the authority to make decisions but cannot delegate the ultimate responsibility for the results of those decisions.
A supervisor’s span of control should not exceed seven subordinates.
Responsibility should be accompanied by adequate authority.
Employees at all levels should be empowered to make decisions.

Q107. An investment company is attempting to allocate its available funds between two investment alternatives, stocks and bonds, which differ in terms of expected return and risk. The company would like to minimize its risk while earning an expected return of at least 10% and investing no more than 70% in either of the investment alternatives. An appropriate technique for allocating its funds between stocks and bonds is:

Q108. When reviewing application controls using the four-level model, which of the following processes are associated with level 4 of the business process method?

Q109. A manufacturer produces a quality product for which it charges a little more than some competing items but gives its consumers a more liberal warranty policy. The product carries a 5-year warranty that covers both labor and materials charges. Which of the following defines the appropriate method of accounting for the warranty?

Q110. The economic order quantity can be calculated using the following formula:

Which of the following describes how the optimal order size will change if the annual demand increases by 36 percent?

Q111. 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?

Q112. All of the following are true with regard to the first-in, first-out inventory valuation method except:

Q113. A manufacturing company employs variable costing for internal reporting and analysis purposes. However, it converts its records to absorption costing for external reporting.
The Accounting Department always reconciles the M o operating income figures to assure that no errors have occurred in the conversion. The fixed manufacturing overhead cost per unit was based on the planned level of production of 480.000 units. Financial data for the year are presented below:

The difference between the operating income calculated under the variable costing method and the operating income calculated under the absorption costing method would be:

Q114. One of the main reasons total quality management TOM) can be used as a strategic weapon is that:

Q115. A means of limiting production delays caused by equipment breakdown and repair is to:

Q116. If the market rate of interest is [List A] the coupon rate when bonds are issued, then the bonds will sell in the market at a price [List B] the face value and the issuing firm will record a [List C] on bonds payable.
List A
List B
List C
Equal to
Equal to
Premium
Greater than
Greater than
Premium
Greater than
Less than
Discount
Less than
Greater than
Discount

Q117. What is the first step an internal audit function should take to define its organizational structure, deliverables, communication protocols, and resourcing model?

Q118. Which of the following network types should an organization choose if it wants to allow access only to its own personnel?

Q119. Business process reengineering is most likely to:

Q120. A comp, any with three prod. Is classifies its costs as belonging to five functions: design, production, marketing, distribution and customer services. For pricing purposes, all company costs are assigned to the three products. The direct costs of each of the five functions are traced directly to the three products. The indirect costs of each of the five business functions are collected into five separate cost pools and then assigned to the three products using appropriate allocation bases. The allocation base that will most likely be the best for allocating the indirect costs of the distribution function is

Q121. If a call option is out-of-the-money, the: