Certified Internal Auditor (CIA) Part 2: Practice of Internal Auditing — Question 114

An internal auditor completed a review of expenses related to the launch of a new project. The auditor sampled 45 transactions approved by a senior project manager and identified 30 with questionable vendor documentation. Which of the following is the most appropriate conclusion for the auditor to include in the audit report?

Answer options

• A. The organization incurred excessive cost overruns that resulted in significant financial and legal risk to the project.
• B. The organization experienced a potential conflict of interest.
• C. The organization had weaknesses in its review process, which allowed questionable transactions with some vendors.
• D. The organization allowed the project to launch without assurance that all transactions were regularly approved.

Correct answer: C

Explanation

The correct answer is C because it accurately identifies the weakness in the review process that allowed questionable transactions, which is directly supported by the auditor's findings. The other options either exaggerate the issues (A), imply different problems (B), or mischaracterize the situation (D), making them less appropriate conclusions based on the evidence provided.