As part of their duties, internal auditors may be asked to perform management functions for a business unit in financial difficulty. In this case and only in this case, auditors can be asked to audit activities they have previously performed regardless of the time that has elapsed between the two events.

	True
	False

An organization is in the process of establishing its internal audit department. The organization has no previous experience with internal auditors. It is appropriate to tell chief audit executive (CAE) applicants that the CAE will be reporting to the external auditors.

	True
	False

Which of the following areas are addressed by attribute standards?

	Independence, objectivity, and nature of the work
	Independence, communication of findings, and resolution of problems affecting the risks accepted by management
	Independence, objectivity, and proficiency
	Engagement planning, engagement execution, and progress monitoring

"Independence and objectivity" are part of which of the following standards?

	Implementation standard
	Engagement standard
	Attribute standard
	Performance standard

The organizational status of the internal audit function is one of three factors that affect the degree of independence of internal auditors. Which of the following situations is the most likely to ensure the independence of internal auditing?

	The chief audit executive must report to someone in the organization who has enough authority to promote independence.
	Personnel under the authority of the chief audit executive must not have any direct authority over the activities subject to audit.
	To maintain independence, the chief audit executive must have limited access to the board of directors.
	The resolution of control issues must not be under the direction of the chief audit executive.

Which of the following is an advantage of using outsourced internal audit resources?

	Outsourcing provides access to expertise not normally available.
	External experts are often not familiar with the company and its culture.
	Costs are often competitive for routine, non-specialized assignments.
	External resources can respond to urgent management requests in a much more efficient manner.