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Question 105

A company's chief audit executive determines that the internal audit staff does not have the requisite skills to conduct an audit of the financial derivatives area.

Which of the following actions would be the least acceptable?

Notify the audit committee of the problem and consult with them regarding outsourcing the audit engagement to a qualified external auditing firm.

Determine the requisite knowledge needed and obtain the proper training for auditors if such training is available within the appropriate time framework outlined by the audit committee.

Notify the audit committee of the problem and assign the most competent auditors to perform the audit engagement.

Employ the skills of a financial derivatives expert to consult on the project, and supplement the consulting with a local seminar on financial derivatives.

Correct Answer: C

Assigning the most competent auditors to perform the audit engagement without the requisite skills is the least acceptable action. Competence in other areas does not necessarily translate to expertise in financial derivatives, which could compromise the audit's quality and outcome. The other options involve consulting, training, or outsourcing to ensure the required skills are available, making them more acceptable than option C.

Discussion

TheMK90Option: D

Why not D?

LauraDixieOption: C

They are asking for the LEAST acceptable. The IIA should not continue with the engagement without having all the skills or knowledge. All of the other options are acceptable

LauraDixie

Even if they assign the MOST COMPETENT auditor, this does not mean that that auditor has all the skills and knowledge required

Money89Option: C

Why is the answer C?