Code of Ethics

Question 1

Integrity 1.1 /shall perform their work/

Answer 1

With honesty, diligence, and responsibility.

Question 2

Integrity 1.2 /shall observe/

Answer 2

The law and make disclosures expected by the law and the profession

Question 3

Integrity 1.3 /not knowingly be a party/

Answer 3

any illegal activity, or engage in acts that are discreditable to the profession of internal auditing or to the organization.

Question 4

Integrity 1.4 /shall respect and contribute/

Answer 4

the legitimate and ethical objectives of the organization

Question 5

Objectivity

Answer 5

Internal auditors exhibit the highest level of professional objectivity in gathering, evaluating, and communicating information about the activity or process being examined. Internal auditors make a balanced assessment of all the relevant circumstances and are not unduly influenced by their own interests or by others in forming judgments.

Question 6

Objectivity 2.1 /not participate/

Answer 6

Shall not participate in any activity or relationship that may impair or be presumed to impair their unbiased assessment. This participation includes those activities or relationships that may conflict with the interests of the organization.

Question 7

Objectivity 2.2 (not accept)

Answer 7

Shall not accept anything that may impair or be presumed to impair their professional judgment.

Question 8

Objectivity 2.3 (disclose)

Answer 8

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

Question 9

A conflict of interest policy (prohibit)

Answer 9

should prohibit the transfer of benefits between an employee and those with whom the organization deals.

Question 10

Disclosure is not limited by time constraints:

Answer 10

If management override of an important control creates exposure to a material risk, the internal auditor is ethically obligated to report the matter to senior officials charged with performing the governance function.

Question 11

An internal auditor cannot assure anonymity:

Answer 11

Information communicated to an internal auditor is not deemed to be privileged. However, promising merely to attempt to keep the source of the information confidential is allowed.

Question 12

Disclosure is not required (fraud)

Answer 12

when the internal auditor gathers sufficient information to dispel the suspicion of fraud.

Question 13

The CAE … with other internal and external providers of relevant assurance and consulting services

Answer 13

should share information and coordinate with activities

Question 14

Violation of Rule of Conduct Objectivity 2.1 (fraternize)

Answer 14

Excessive individual fraternizing outside of work with organization’s employees, management, third-party suppliers, and vendors

Question 15

Violation Objectivity 2.1 (sales or services or products)

Answer 15

by internal auditor to the organization

Question 16

Violation Objectivity 2.1

Participation in non-public service organizations may not be allowed

Answer 16

serving as a consultant to third parties (vendors, suppliers, etc.) with which the organization conducts business.

Question 17

Violation Objectivity 2.1
Performing an audit in a department managed

Answer 17

by a family member

Question 18

Violation objectivity 2.1
accepting a bonus

Answer 18

based on work accomplished during an audit

Question 19

Violation objectivity 2.1
responsibility and auditing an area

Answer 19

assuming management responsibilities and auditing an area in which the auditor had such responsibilities within 1 year.

Question 20

Violation objectivity 2.2.
accepting (names)

Answer 20

gifts, meals, trips, and special treatment that exceed policy limits or are not disclosed and approved

Question 21

Violation objectivity 2.2
working and accepting

Answer 21

working in a non-audit position and accepting gifts not permitted by IIA code of conduct

Question 22

Violation objectivity 2.3
omission

Answer 22

Intentional omission of disclosures of illegal activity from final engagement communications

Question 23

Violation objectivity 2.3
pertinent information

Answer 23

1. withholding pertinent information
2. Not communicating pertinent information to the CAE

Question 24

Violation objectivity 2.3
distorting

Answer 24

Distorting facts reported in final engagement communications

Question 25

Objectivity- The Standard provide

Answer 25

a systematic and disciplined internal audit approach that can assist with ensuring objectivity.

Question 26

Objectivity best provide - Internal auditors:

Answer 26

For internal auditors, objectivity can be best pursued by providing a balanced assessment, ensuring that they are not unduly influenced in forming judgments, and avoiding conflicts of interest and impairments.

Question 27

Confidentiality

Answer 27

Internal auditors respect the value and ownership of information they receive and do not disclose information without appropriate authority unless there is a legal or professional obligation to do so.

Question 28

Confidentiality 3.1 (acquired information)

Answer 28

Shall be prudent in the use and protection of information acquired in the course of their duties.

Question 29

Confidentiality 3.2 (not use)

Answer 29

Shall not use information for any personal gain or in any manner that would be contrary to the law or detrimental to the legitimate and ethical objectives of the organization.

Question 30

Data collect and use: ( confidentiality)

Answer 30

Collect only data required to perform the assigned engagement and use this information only for the engagement’s intended purposes.

Question 31

In order to protect information: confidentiality

Answer 31

Protect information from intentional or unintentional disclosure through the use of controls such as data encryption, email distribution restrictions, and restriction of physical access to the information.

Question 32

Eliminate information confidentiality

Answer 32

Eliminate copies of or access to such data when it is no longer needed.

Question 33

The internal audit activity as a whole most likely is in conformance with the principle: Confidentiality

Answer 33

Given no reports or investigations of individual auditors’ violations of policies, procedures, and rules related to confidentiality.

Question 34

Internal auditors demonstrate conformance with engagement record confidentiality

Answer 34

by documenting distribution restrictions in engagement workpapers and reports and by retaining authorizations of all disclosures and approved distribution lists.

Question 35

The Code of Ethics states

Answer 35

the principles and expectations governing the behavior of individuals and organizations in the conduct of internal auditing. It describes the minimum requirements for conduct and behavioral expectations rather than specific activities.

Question 36

The purpose of The Institute’s Code of Ethics

Answer 36

is to promote an ethical culture and in the profession of internal auditing.

Question 37

A code of ethics is necessary and appropriate for the profession of internal auditing, founded as it is

Answer 37

on the trust placed in its objective assurance about governance, risk management, and control.

Question 38

Code of ethics (Principles) that are relevant to

Answer 38

the profession and practice of internal auditing

Question 39

Code of ethics (Rules of conduct) that describe

Answer 39

behavior norms expected of internal auditors. These rules are an aid to interpreting the Principles into practical applications and are intended to guide the ethical conduct of internal auditors.

Question 40

Integrity

Answer 40

The integrity of internal auditors established trust and thus provides the basis for reliance on their judgment.

Question 41

Competency

Answer 41

Internal auditors apply the knowledge, skills, and experience needed in the performance of internal audit services.

Question 42

Integrity is the foundation

Answer 42

of the three principles in The IIA’s Code of Ethics. Objectivity, confidentiality, and competency all depend on integrity. Integrity also underpins the Standards.

Question 43

The CAE’s responsibility for implementing integrity includes:

Answer 43

• Should cultivate a culture of integrity by acting with integrity and adhering to the Code of Ethics
• also establishes policies and procedures to guide the internal audit activity…to show diligence and responsibility
• also may emphasize the importance of integrity by providing training that demonstrates integrity and other ethical principles in action

Question 44

For internal auditors, the best attempts to identify and measure integrity

Answer 44

likely involve astute awareness and understanding of the Code of Ethics’ rules of conduct for integrity, the IPPF’s Mandatory Guidance, and supporting practices.

Question 45

Demonstrate the integrity of the internal audit activity as a whole

Answer 45

Diligent supervision of engagement and performance of the self-assessments required by the Standards

Question 46

Noncompliance with the Standard and other IPPF Mandatory Guidance

Answer 46

• Performing internal audit services with undeclared impairments to independence and objectivity
• Performing internal audit services for which one is not competent
• Soliciting or disclosing confidential information without proper authorization
• Stating that the internal audit activity is operating in conformance with the Standards when the assertion is not supported by the results of the quality assurance and improvement program.

Question 47

For internal auditors, behaviors that may not be illegal but discreditable include

Answer 47

• Failing to accept responsibility for making mistakes
• Issuing false reports or permitting others to do so
• Making claims about one’s competency in a manner that is deceptive, false, or misleading
• Making disparaging comments about the organization, fellow employees, or its stakeholders, either in person or via media
• Minimizing, concealing, or omitting observations or unsatisfactory conclusions and ratings from engagement reports or overall assessments
• Overlooking illegal activities that the organization may tolerate or condone
• Using the CIA designation or other credentials after they have expired or revoked.

Question 48

Conformance with objectivity is demonstrated by: (The CAE)

Answer 48

• the CAE provides relevant policies and procedures for the internal audit activity
• The CAE requires internal auditors attend meetings or training sessions about objectivity (f.e CPE)
• the CAE documents the rationale for allocation of resources to the internal audit plan, including potential impairments

Question 49

Conformance with objectivity is demonstrated by:

Answer 49

• Other devices may include documentation of research into potential conflicts of interest involving outsourced and cosourced activities
• Approval of the CAE or a designated engagement supervisor of engagement workpapers may evidence that internal auditors have conducted a balanced assessment
• Feedback from post-engagement surveys and supervisory reviews of engagements may provide additional evidence that the internal auditors’ work appeared to be performed objectively
• Assessment as part of the internal audit activity’s QAIP also lend support that appropriate objectivity was used in arriving at internal audit conclusions and opinions

Question 50

To better understand the effects of legal and regulatory requirements and protections (e.g., legal privilege or attorney-client privilege)

Answer 50

the CAE should consult with legal counsel. The organization’s policies and procedures may require that specific authorities review and approve business information before external release.

Question 51

Internal auditors demonstrate conformance with engagement record confidentiality by documenting

Answer 51

distribution restrictions in engagement workpapers and reports and by retaining authorizations of all disclosures and approved distribution lists.

Question 52

The CAE may demonstrate support of internal audit confidentiality through

Answer 52

evidence of policies, processes, procedures, and training materials implemented to cover confidentiality as it applies to the internal activity and the organization.

Question 53

Regarding the release of engagement result, reports, or related information, the CAE demonstrates (confidentiality)

Answer 53

conformance with the confidentiality principle and rules of conduct by demonstrating and relating records of disclosures approved by legal counsel, if applicable, and by senior management and the board.

Question 54

The internal audit activity as a whole most likely is in conformance with the principle

Answer 54

Given no reports or investigations of individual auditors’ violations of policies, procedures, and rules related to confidentiality.