Certified Internal Auditor (CIA) Part 2: Practice of Internal Auditing — Question 140

An organization's finance manager plans to implement a state-of-the-art management system to better manage the organization's receivables. The finance manager consulted the chief audit executive (CAE) and asked for her assistance in determining whether the organization is able to accommodate this system. How would the CAE proceed to determine the objectives of this engagement?

Answer options

• A. Ask the CEO to determine the scope and objectives of the engagement.
• B. Request that the board disclose its concerns over governance for inclusion in the engagement.
• C. Discuss the concerns with the finance manager and work together to agree on the engagement objectives.
• D. Review previous audit reports from the area and develop engagement objectives to address the area's key risks and controls.

Correct answer: C

Explanation

The correct answer is C because engaging directly with the finance manager allows for a collaborative approach to set clear and relevant objectives for the new system. Option A is incorrect as the CEO may not have specific insights into the operational objectives needed for this engagement. Option B is not appropriate since governance concerns are not the primary focus for determining engagement objectives. Option D, while useful for understanding risks, does not prioritize collaboration with the finance manager, which is essential for aligning the engagement with the organization's specific needs.