Proficiency & Due Professional Care

Question 1

Proficiency is a collective term that refers to what?

Answer 1

The knowledge, skills, and other competencies required of internal auditors to effectively carry out their professional responsibilities

Question 2

According to standard 1200 how should engagements be performed?

Answer 2

Engagements should be performed with proficiency and due professional care.

Question 3

How can internal auditors develop proficiency?

Answer 3

via education, experience, professional development opportunities, and qualifications such as the CIA

Question 4

How is due professional care developed?

Answer 4

• By understanding and properly applying the IPPF’s systematic and disciplined approach to internal auditing.
• By conforming to the IIAs code of ethics

Question 5

What criteria can a CAE use to assess the proficiency of internal auditors?

Answer 5

The IIA’s Competency Framework or a similar benchmark.

Question 6

What evidence can a CAE use to demonstrate conformance with standard 1200 - proficiency and due professional care?

Answer 6

• Competency assessments of the internal audit activity.
• Records of a recruitment and training strategy, job descriptions, and resumes.
• Internal audit policies and procedures.
• Evidence that internal audit policies and procedures were communicated and signed

Question 7

What does standard 1210 - Proficiency state auditors must possess to perform their individual responsibilities?

Answer 7

They must possess the knowledge, skills, and other competencies needed to perform their individual responsibilities.

“Internal auditors must possess the knowledge, skills, and other competencies needed to perform their individual responsibilities. The internal audit activity collectively must possess or obtain the knowledge, skills, and other competencies needed to perform its responsibilities.”

Question 8

According to standard 1210 - Proficiency, who must possess the knowledge, skills, and other competencies needed to perform their responsibilities - internal auditors, the internal audit activity, or both?

Answer 8

Both

“Internal auditors must possess the knowledge, skills, and other competencies needed to perform their individual responsibilities. The internal audit activity collectively must possess or obtain the knowledge, skills, and other competencies needed to perform its responsibilities.”

Question 9

What can the CAE develop to help build and maintain the proficiency of the internal audit activity?

Answer 9

To build and maintain the proficiency of the internal audit activity, the CAE may develop a competency assessment tool or skills assessment based on the Competency Framework or another benchmark

Question 10

If the internal audit activity does not have the staff with the appropriate knowledge and competencies, what should the CAE do?

Answer 10

The CAE is expected to obtain competent advice or assistance to fill any gaps.

Question 11

Standard 1210 - proficiency - requires individual internal auditors to possess the knowledge, skills, and competencies needed to carry out their responsibilities effectively. What might individual auditors use as a basis for self-assessment?

Answer 11

The IIA’s competency framework

Question 12

At the level of the individual engagement, what is the CAE responsible for?

Answer 12

The CAE assumes overall responsibility for supervising the engagement to ensure quality, achievement of objectives, and staff development

Question 13

If after reviewing the objective and scope of an engagement the internal auditor notices that there might be limitations in their competencies which might prevent them from achieving the engagement objectives, what should the IA do?

Answer 13

They should discuss the limitations with the CAE.

Question 14

How might internal auditors evidence their proficiency?

Answer 14

CVs

Maintaining records of certifications and continuing professional development

Question 15

According to standard 1210.A1, what must the CAE do if the internal auditors lack the knowledge, skills, or other competencies needed to perform all or part of an assurance engagement.

Answer 15

“The CAE must obtain competent advice and assistance if the internal auditors lack the knowledge, skills, or other competencies needed to perform all or part of the engagement.”

Question 16

According to standard 1210.A2, Internal auditors must have what in relation to fraud?

Answer 16

“Internal auditors must have sufficient knowledge to evaluate the risk of fraud and the manner in which it is managed by the organization.”

Question 17

Are internal auditors expected to have the knowledge and expertise of a person whose primary responsibility is detecting and investigating fraud?

Answer 17

No

Question 18

According to standard 1210.A3, Internal auditors must have what in relation to IT risks?

Answer 18

“Internal auditors must have sufficient knowledge of key IT risks and controls and available technology-based audit techniques to perform their assigned work. However, not all internal auditors are expected to have the expertise of an internal auditor whose primary responsibility is information technology auditing.”

Question 19

According to standard 1210.C1, what must the CAE do if the internal auditors lack the knowledge, skills, or other competencies needed to perform all or part of a consultation engagement.

Answer 19

The CAE must decline the consulting engagement or obtain competent advice and assistance.

Question 20

What does standard 1220 - Due professional care say that internal auditors must apply?

Answer 20

Internal auditors must apply the care and skill expected of a reasonably prudent and competent internal auditor. Due professional care does not imply infallibility.

Question 21

What would help internal auditors perform their duties with due professional care?

Answer 21

• Obtaining appropriate education, experience, and certifications.
• Understanding and applying the mandatory guidance of the IPPF.

Question 22

Can internal auditors provide absolute assurance?

Answer 22

No. Internal auditors are not expected to give absolute assurance that noncompliance or irregularities do not exist.

Question 23

In exercising due professional care, what factors does standard 1220.A1 state that internal auditors must consider during an assurance engagement?

Answer 23

• Extent of work needed to achieve the engagement objectives
• Relative complexity
• Adequacy and effectiveness of governance, risk management, and control processes
• Probability of significant errors, fraud, or noncompliance
• Cost of assurance in relation to potential benefits

Question 24

Considering the use of technology-based audit and other data analysis techniques for an assurance engagement would demonstrate what?

Answer 24

Due professional care.

Standard 1220.A2
“In exercising due professional care internal auditors must consider the use of technology-based audit and other data analysis techniques.”

Question 25

According to standard 1220.A3 what must internal auditors be alert to?

Answer 25

“Internal auditors must be alert to the significant risks that might affect objectives, operations, or resources. However, assurance procedures alone, even when performed with due professional care, do not guarantee that all significant risks will be identified.”

Question 26

In exercising due professional care, what factors does standard 1220.C1 state that internal auditors must consider during a consultation engagement?

Answer 26

Needs and expectations of clients, including the nature, timing, and communication of engagement results;

Relative complexity and extent of work needed to achieve the engagement’s objectives; and

Cost of the consulting engagement in relation to potential benefits.”

Question 27

Who has overall responsibility for ensuring that due professional care is applied, the IA, the CAE, or both?

Answer 27

The CAE

Question 28

To ensure due professional care at the engagement level, engagements should be properly supervised which usually involves what?

Answer 28

• Review of engagement workpapers, results, and conclusions

- Feedback to the auditors

Question 29

How can the internal audit activity demonstrate conformance with due professional care standards

Answer 29

• understanding and applying the mandatory guidance of the IPPF
• performance reviews of IAs
• supervisory reviews documented in workpapers
• evidence of feedback from audit clients via post engagement surveys

Question 30

What does proficiency encompass consideration of?

Answer 30

It encompasses consideration of current activities, trends, and emerging issues, to enable relevant advice and recommendations.

Question 31

What does standard 1230 state that internal auditors must enhance through continuing professional development?

Answer 31

Their knowledge, skills and other competencies