Exam Question#22 (Planing the Engagement)

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  • #182415

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    This forum is restricted to members of the associated course(s).

    Omar
    Participant

    22. Question ID: CIA 1191 II.13 (Topic: A-C. Planning the Engagement)
    Factors that should be considered when assessing risk in a functional area include:

    Volume of transactions.
    Degree of system integration.
    Years since last engagement.
    Significant management turnover.
    Value of assets at risk.
    Average value per transaction.
    Results of last engagement.
    Factors that best define the significance of risk are

    A. 2, 4, and 7.
    B. 3, 4, and 6.
    C. 1, 5, and 6.correct
    D. 1 through 7.wrong
    Your Incorrect Answer Explanation:

    Factors 2, 3, 4 and 7 do not measure risk.

    Correct Answer Explanation:

    Factors 1, 5 and 6 are the best measures of risk. These factors can be quantified, whereas the others cannot be.

    I have problem understanding the correct answer of this question. Risk factors cloud be quantitative and qualitative as well. Accordingly, all or the provided risk factors should be considered

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  • #182923

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    Brian Hock
    HOCK international

    Omar,

    You are correct that risk factors include both quantitative and qualitative factors, but the factor still needs to be connected to a risk for that functional area.

    #7 The result of the previous engagement is not a risk factor for the function.
    #3 How long it has been since an engagement does not change the risks that the function faces.
    #2 How integrated it is in the system does not impact the risk that the function faces.
    #4 Management turnover is one that I could see having a bit of a connection to the risk for the functional area, but even that is indirect.

    But, there was not a choice that included 1, 4, 5 and 6.

    Also, the question mentions that we are looking for significant risks. So, yes, qualitative factors have to be included too, if they represent a risk for that function.

    I hope that this helps.

    Brian

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