Certified Internal Auditor (CIA) Part 1: Business Acumen — Question 66

Regarding the chief audit executive (CAE), which of the following is considered an impairment to the independence of the internal audit activity?

Answer options

• A. The CAE reports administratively to the CEO.
• B. The CAE is asked to submit the liquidation of her travel allowances to human resources for approval.
• C. The CAE’s supervisor is responsible for the risk management function.
• D. The CAE is asked to review new procedures before implementation.

Correct answer: C

Explanation

The correct answer is C because having the CAE's supervisor in charge of risk management can create a conflict of interest, undermining the CAE's independence. Options A, B, and D do not directly impair the internal audit's independence; they involve administrative processes or review tasks that do not compromise the CAE's objectivity.