During an assurance engagement, an internal auditor reviews a tender inviting vendors to submit bids to supply financial services software to the organization. She suspects that the tender was…

Question

Options

• AReview payments made for the financial services software.
• BConfront a procurement specialist with the suspicion.
• CSubmit an anonymous tip to the whistleblower hotline.
• DAnalyze technical terms and conditions of the tender.

• A
  4% (1)
• B
  4% (1)
• C
  12% (3)
• D
  80% (20)

Explanation

Analyzing the technical terms and conditions of the tender (D) is the correct next step because the auditor's suspicion is specifically about tailoring - meaning the language, specifications, or requirements were written to favor one vendor. Examining those terms directly tests that hypothesis with evidence, following proper audit methodology of gathering facts before drawing conclusions.

Why the distractors are wrong:

• A (Review payments): Payments come after contract award and tell you nothing about whether the tender itself was rigged - that's skipping ahead in the evidence chain.
• B (Confront a procurement specialist): Confronting someone without supporting evidence is premature and could compromise the investigation by alerting the wrongdoer.
• C (Anonymous tip to whistleblower hotline): The auditor is already conducting an assurance engagement - escalating anonymously bypasses their professional responsibility to investigate through proper audit channels first.

Memory tip: Think of the audit process as "evidence before escalation." The auditor has a suspicion, not a finding. The next step is always to gather objective evidence that directly tests the suspicion - in this case, reading the tender terms to see if they were crafted to match one specific vendor's capabilities. Only after building a case do you escalate.

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