Preview Questions Internal Auditor | Role Specific Skill

Question 1: In the context of the Volcker Rule, which of the following would be a key compliance audit focus for financial institutions?

Which action should you take?

Choose only one option

The compliance of proprietary trading and ownership interests with the rule

The classification of loans under international financial reporting standards

The proper valuation of risk-weighted assets

The accuracy of investment portfolio valuations

Question 2: In performing a compliance audit, how should auditors evaluate the effectiveness of a company's anti-money laundering (AML) program?

Which action should you take?

Choose only one option

By reviewing IT security protocols to ensure data protection

By analyzing profitability reports to determine financial impact

By performing a risk assessment of the company's competitors

By testing the effectiveness of transaction monitoring systems and reviewing customer due diligence procedures

Question 3: What is the primary purpose of the footnotes in financial statements for BFSI companies?

Which action should you take?

Choose only one option

To disclose the tax liabilities of the company

To provide explanatory details and additional context to financial figures

To highlight operational risks associated with investments

To forecast the future performance of the company

Question 4: How should an auditor verify compliance with AML regulations during a compliance audit?

Which action should you take?

Choose only one option

By evaluating the company's stock market performance

By reviewing transaction reports and KYC information for consistency

By evaluating the management structure of the company

By assessing the company's asset allocation

Question 5: Under IFRS 10, when should a parent company consolidate a subsidiary?

Which action should you take?

Choose only one option

When it is involved in the day-to-day operations of the subsidiary

When it has control over the subsidiary, even if ownership is less than 50%

When it holds more than 50% of voting shares

When it has financial interest in the subsidiary

Question 6: Which of the following best describes the treatment of intangible assets under IAS 38?

Which action should you take?

Choose only one option

They must be amortized over a period not exceeding 20 years

They are only recognized when purchased from an external party

They must be written off if not generating income

They are not amortized unless their useful life is finite