IIA Updated IIA-CIA-Part2 Exam Questions and Answers by sylvie

Comprehensive and Detailed Explanation:

The most significant concern is the replacement of auditor judgment with AI outputs (C). Per the Global Internal Audit Standards, auditors must exercise professional judgment in planning, evaluating evidence, and forming conclusions. While AI can enhance efficiency and flag anomalies, final risk assessments must remain the responsibility of auditors. Option A (variations in answers) and Option D (acceptance issues) are secondary operational risks. Option B is incorrect — generative AI can interpret free-text responses, though with limitations. The core issue is ensuring that AI supports, but does not replace, human professional judgment. Therefore, the correct answer is Option C.

According to IIA guidance, the chief audit executive (CAE) is responsible for evaluating and verifying management ' s response to audit recommendations. The CAE must also determine the need and scope for additional work based on the adequacy and timeliness of management ' s corrective actions. This ensures that the audit recommendations are effectively implemented and that any residual risks are appropriately managed. References: IIA Standard 2500 – Monitoring Progress, IIA Practice Advisory 2500.A1-1

When selecting an external service provider, the CAE must ensure that the provider possesses the necessary knowledge, skills, and competencies relevant to the specific type of work being reviewed. This is best demonstrated by the provider ' s experience in the relevant field (Option D). The other options, such as financial interest (Option A), prior relationships (Option B), and compensation (Option C), are considerations for assessing potential conflicts of interest or independence but are not primary criteria for evaluating technical competency.

IIA Standard 1210: Proficiency.

IIA Practice Guide on External Service Provider Arrangements.

The best possible engagement objectives are those derived from a comprehensive risk assessment that incorporates inputs from both senior management and the company ' s risk function experts. This approach ensures that the internal audit objectives are aligned with the organization ' s strategic priorities and risk landscape. By combining insights from senior management with the technical expertise of risk function experts, the internal audit activity can develop well-rounded and relevant engagement objectives that address the most significant risks facing the organization.

The Institute of Internal Auditors (IIA) Standard 2010 – Planning: " The chief audit executive must establish risk-based plans to determine the priorities of the internal audit activity, consistent with the organization’s goals. "

IIA Practice Guide on " Internal Audit Planning "