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IIA Practice of Internal Auditing IIA-CIA-Part2 Question # 28 Topic 3 Discussion

IIA Practice of Internal Auditing IIA-CIA-Part2 Question # 28 Topic 3 Discussion

IIA-CIA-Part2 Exam Topic 3 Question 28 Discussion:
Question #: 28
Topic #: 3

An internal auditor performed a review that focused on the organization’s process for vetting vendors. The internal auditor’s testing identified that 120 out of 130 vendors had a business relationship with the organization’s procurement manager that violated conflict-of-interest policies. Which of the following conclusions could the internal auditor draw from these results?


A.

The organization is exposed to significant fraud and abuse risks as a result of the vendor and employee business relationships.


B.

Due to improper relationships and favoritism, vendors are not providing goods or services at a reasonable price to meet the objectives.


C.

The organization’s conflict-of-interest policies are not clear or well communicated throughout the organization.


D.

Improper relationships and favoritism means that controls are not effective and significant fraud occurs.


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