Certified Internal Auditor (CIA) Part 1: Business Acumen — Question 171

An internal auditor failed to identify transactions between the parent organization and a subsidiary. What is the most likely reason for the failure?

Answer options

• A. The auditor misunderstood the audit objectives.
• B. The auditor lacked professional skepticism.
• C. The auditor's fieldwork was not properly supervised.
• D. The auditor lacked an understanding of the organization.

Correct answer: B

Explanation

The correct answer is B because a lack of professional skepticism can lead an auditor to overlook suspicious transactions that may not be easily identifiable. Options A, C, and D may contribute to audit deficiencies, but they do not directly address the auditor's critical evaluation of the information presented.