Certified Internal Auditor (CIA) Part 1: Business Acumen — Question 49

When an internal auditor applies due professional care to perform an assurance engagement, which of the following must she consider?
1. Findings of the last audit engagement performed.
2. Probability of significant errors, irregularities, or noncompliance.
3. Extent of work needed to achieve engagement objectives.
4. Cost of the engagement versus the potential benefits.

Answer options

• A. 1 and 4 only
• B. 2 and 3 only
• C. 2, 3, and 4 only
• D. 1, 2, 3, and 4

Correct answer: C

Explanation

The correct answer is C, as options 2, 3, and 4 are essential considerations for ensuring the effectiveness of the audit. Option 2 addresses the likelihood of significant issues, option 3 focuses on the necessary work to meet objectives, and option 4 balances costs against benefits. Option 1, while relevant, is not as critical as the others in assessing current engagement risks.