An organization established 20 years ago has had its internal audit activity in place for the last three years. Which of the following would allow the internal audit activity to accurately state…

Question

Options

• ADocumented assessment was performed by the audit committee and confirmed conformance.
• BInternal and external assessments are performed annually, and nonconformance results are
• CThe independent and objective judgement of the chief audit executive confirmed conformance
• DDocumented internal assessments are performed periodically and confirm conformance.

• A
  11% (2)
• B
  6% (1)
• D
  83% (15)

Explanation

Option D is correct because the IIA Standards require a Quality Assurance and Improvement Program (QAIP) that includes both ongoing monitoring and periodic internal assessments - and since this internal audit activity has only existed for three years, it has not yet reached the five-year threshold that triggers a mandatory external assessment. Documented periodic internal assessments alone are sufficient to claim conformance at this stage.

Why the distractors fail:

• A is wrong because the audit committee is an oversight body, not a qualified assessor under the Standards - quality assessments must be conducted by qualified internal or external parties, not the audit committee.
• B is wrong on two counts: external assessments are required at least every five years, not annually, and requiring them annually goes beyond what the Standards mandate.
• C is wrong because the CAE's personal judgment, no matter how independent or objective, does not substitute for a documented, systematic QAIP process - conformance requires documented evidence, not opinion.

Memory tip: Think "5 and periodic" - external assessments every 5 years minimum, internal assessments periodically with documentation. If the activity is under 5 years old, documented internal assessments are your ticket to claiming conformance.

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