Some lime after the final audit report was issued, the engagement supervisor teamed that several internal control deficiencies were not remedied, despite management's previous agreement to remedy…

Question

Options

• AThe engagement supervisor must notify the chief audit executive (CAE) that the deficiencies have
• BThe engagement supervisor should rely on professional judgment as to whether the CAE should
• CThe engagement supervisor should rely on his negotiation skills and issue an ultimatum to
• DEnsure that these deficiencies are captured in the documentation as high-priority areas to be

• A
  86% (30)
• B
  3% (1)
• C
  9% (3)
• D
  3% (1)

Explanation

According to the International Standards for the Professional Practice of Internal Auditing, the CAE must be kept informed of significant issues and deficiencies that are not addressed by management. Standard 2600 - Communicating the Acceptance of Risks requires the CAE to report any situation where management has accepted a level of risk that may be unacceptable to the organization. If the engagement supervisor learns that agreed-upon remedial actions have not been implemented, the CAE needs to be notified to determine further steps, ensuring that risks are managed appropriately and in alignment with the organization's risk tolerance. This response aligns with the internal audit function's responsibility to follow up on management's corrective

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