Group 19: Internal Audit & SA610

30 original practice MCQs. 2 marks each. Separate practice and test sets.

Original practice, not ICAI questions, official suggested answers or an official examiner scheme. Equivalent correct work is credited within the stated caps. Public practice availability is not full official question-bank completion.

Law or regulation may prohibit or restrict assistance; case-supplied legal availability is not blanket sector permission. No unverified statutory internal-audit threshold or fixed reliance percentage is taught.

Not scored yet.

AUD-G19-P001 · 2 marks

A company has no internal function and offers no internal auditors for direct assistance. What follows for SA 610 use in this engagement?

A. External audit becomes unnecessary. B. Absence itself requires an adverse opinion. C. There is no function-work or direct-assistance use to evaluate under this SA. D. SA 610 requires creating a function before any external audit.

Explanation

Correct answer C: There is no function-work or direct-assistance use to evaluate under this SA.

The SA addresses use where relevant; it does not create an internal function or substitute the external audit. Revised SA 610 paragraph(s) 2-4.

AUD-G19-P002 · 2 marks

An accounts clerk performs the daily posting control but no assurance/consulting evaluation of governance, risk or control. Which conclusion is unsupported?

A. That routine performance of a control alone makes the clerk an internal audit function. B. Daily operation differs from evaluating the control. C. A job title alone does not establish the function definition. D. Examine the actual activities rather than the job label.

Explanation

Correct answer A: That routine performance of a control alone makes the clerk an internal audit function.

Operational monitoring/control activity is not automatically the defined internal audit function. Revised SA 610 paragraph(s) 14(a),A1-A4.

AUD-G19-P003 · 2 marks

The internal function provides reliable receivables work. The external partner asks it to co-sign responsibility for the external opinion. Which statement is correct?

A. Responsibility follows the number of test items. B. A signed internal undertaking removes external responsibility. C. Reliable work transfers half the opinion responsibility. D. The external auditor retains sole responsibility for the opinion.

Explanation

Correct answer D: The external auditor retains sole responsibility for the opinion.

Use of work/direct assistance does not reduce sole external responsibility. Revised SA 610 paragraph(s) 11.

AUD-G19-P004 · 2 marks

The function head reports only to the CFO, who can delete unfavourable findings and set the head's bonus. Qualifications are excellent. What needs evaluation?

A. Whether status and policies adequately support objectivity; competence alone cannot cure inadequate support. B. A larger sample always cures management suppression. C. An internal title makes objectivity irrelevant. D. Qualifications automatically establish objectivity.

Explanation

Correct answer A: Whether status and policies adequately support objectivity; competence alone cannot cure inadequate support.

Objectivity support is an independent gate, including organisational status and policies. Revised SA 610 paragraph(s) 15(a),16(a).

AUD-G19-P005 · 2 marks

Objectivity support is adequate, but the function lacks skills needed for the proposed complex IT control work. What is the consequence?

A. Use it solely because reporting lines are sound. B. Replace competence assessment with a management assurance letter. C. Treat long service as proof of every specialised skill. D. Do not use function work if it lacks sufficient competence for the proposed use.

Explanation

Correct answer D: Do not use function work if it lacks sufficient competence for the proposed use.

Competence must be evaluated and be sufficient; separate gates are not substitutes. Revised SA 610 paragraph(s) 15(b),16(b).

AUD-G19-P006 · 2 marks

A qualified objective function does ad hoc undocumented checks with no disciplined process or quality control. Can its work be used as if all gates pass?

A. Yes, external review removes the need to evaluate this gate. B. Yes, academic qualifications replace process. C. No, absence of a systematic disciplined approach including quality control prevents use. D. Yes, whenever the external fee would fall.

Explanation

Correct answer C: No, absence of a systematic disciplined approach including quality control prevents use.

The approach gate independently applies to function-work use. Revised SA 610 paragraph(s) 15(c),16(c).

AUD-G19-P007 · 2 marks

Internal work tests July procurement approvals; the planned external objective is year-end sales cut-off. Which is best?

A. Match only the number of records tested. B. Use procurement results directly as sales cut-off evidence. C. Eligibility makes all work relevant to every assertion. D. Assess whether the nature and scope are relevant to the external objective before deciding use.

Explanation

Correct answer D: Assess whether the nature and scope are relevant to the external objective before deciding use.

Nature/scope relevance is separate from eligibility. Revised SA 610 paragraph(s) 17.

AUD-G19-P008 · 2 marks

Two eligible work bodies cover the same value, but one needs much greater judgment in evaluating evidence. Which response follows?

A. Delegate every final significant judgment if the function is skilled. B. Equal monetary size requires equal external effort. C. Use more internal work merely because the judgment is difficult. D. Perform more external work directly for the higher-judgment area and use less function work.

Explanation

Correct answer D: Perform more external work directly for the higher-judgment area and use less function work.

Judgment affects extent; external auditor makes significant judgments. Revised SA 610 paragraph(s) 18(a),A18-A19.

AUD-G19-P009 · 2 marks

Proposed function use concerns an assertion assessed at higher risk than an otherwise comparable low-risk assertion. What generally follows?

A. Higher risk requires less persuasive evidence. B. The same work percentage is mandatory for both assertions. C. More work directly by the external auditor and less use of function work in the higher-risk area. D. Eligible work always eliminates direct external tests.

Explanation

Correct answer C: More work directly by the external auditor and less use of function work in the higher-risk area.

Risk affects the planned nature/extent; no fixed safe percentage follows. Revised SA 610 paragraph(s) 18(b),A20-A21.

AUD-G19-P010 · 2 marks

Each small proposed use is acceptable alone, but together internal work would leave too little external involvement. What is needed?

A. Approve if management signs the total. B. Accept because each small assignment passed in isolation. C. Reassess the planned aggregate use and retain sufficient external involvement. D. Use an automatic 80% permissible reliance ceiling.

Explanation

Correct answer C: Reassess the planned aggregate use and retain sufficient external involvement.

The aggregate matters even where component tasks initially appear acceptable. Revised SA 610 paragraph(s) 19.

AUD-G19-P011 · 2 marks

The external team intends substantial function-work use. What belongs in its planned-scope/timing communication to governance?

A. Only the internal function's annual budget. B. How it plans to use the function's work. C. No information because internal coordination replaces communication. D. A request that governance assume the opinion responsibility.

Explanation

Correct answer B: How it plans to use the function's work.

Planned use is communicated in the audit-scope discussion. Revised SA 610 paragraph(s) 20.

AUD-G19-P012 · 2 marks

The function and external team use different year-end dates and sample populations without discussion. Which action fits?

A. Discuss planned use with the function to coordinate activities and resolve the scope/timing mismatch. B. Treat coordination as permission to omit adequacy testing. C. Use the larger sample regardless of population relevance. D. Copy either date without understanding it.

Explanation

Correct answer A: Discuss planned use with the function to coordinate activities and resolve the scope/timing mismatch.

Coordination helps align timing/nature/coverage but does not replace evaluation. Revised SA 610 paragraph(s) 21,A24-A25.

AUD-G19-P013 · 2 marks

A manager forwards only a headline saying controls are strong. The relevant function report includes exceptions and scope limitations. What must the external auditor do?

A. Rely solely on the favourable headline. B. Treat a report title as sufficient evidence of adequacy. C. Read the relevant report to understand procedures, findings and limitations before use. D. Assume management removed only irrelevant content.

Explanation

Correct answer C: Read the relevant report to understand procedures, findings and limitations before use.

Relevant reports help understand nature/extent and findings. Revised SA 610 paragraph(s) 22.

AUD-G19-P014 · 2 marks

A function report has careful wording but lacks evidence supporting the stated conclusion. Which is required?

A. Accept if no numerical typo is visible. B. Accept because eligibility alone proves every conclusion. C. Accept if the report is signed. D. Evaluate whether sufficient appropriate evidence supports the work and conclusions.

Explanation

Correct answer D: Evaluate whether sufficient appropriate evidence supports the work and conclusions.

Eligibility and report presentation do not establish body-of-work adequacy. Revised SA 610 paragraph(s) 23.

AUD-G19-P015 · 2 marks

The external team evaluates a function-work body by inquiry and reading only, with no reperformance. What is missing?

A. A universal minimum of exactly 25 repeated tests. B. Some reperformance as part of sufficient procedures on the body planned for use. C. Nothing, because inquiry always substitutes for reperformance. D. A requirement to reperform every item in every case.

Explanation

Correct answer B: Some reperformance as part of sufficient procedures on the body planned for use.

Paragraph 24 requires some reperformance; nature/extent responds to the factors. Revised SA 610 paragraph(s) 24.

AUD-G19-P016 · 2 marks

During adequacy work, suppressed exceptions cast doubt on earlier objectivity evaluation. What should happen?

A. Keep the original evaluation permanently because it was signed. B. Reevaluate initial function judgments and whether the work remains usable. C. Change only the report font. D. Ignore the issue unless every tested item is wrong.

Explanation

Correct answer B: Reevaluate initial function judgments and whether the work remains usable.

Paragraph 25 requires evaluation of whether initial judgments remain appropriate. Revised SA 610 paragraph(s) 25.

AUD-G19-P017 · 2 marks

A case explicitly states applicable law prohibits direct assistance. An individual is competent and objective. Which plan is correct?

A. Do not use direct assistance contrary to the prohibition. B. Proceed with a private confidentiality agreement. C. Proceed if governance approves. D. Proceed for low-value items only because skill is strong.

Explanation

Correct answer A: Do not use direct assistance contrary to the prohibition.

Legal prohibition controls; eligibility/agreement cannot override it. Revised SA 610 paragraph(s) 26.

AUD-G19-P018 · 2 marks

Assistance is lawful, and the function is eligible. The proposed individual's competence and objectivity threats have not been evaluated. What follows?

A. Evaluate that individual before deciding permissible direct assistance. B. An entity signature establishes competence. C. Low fees replace individual evaluation. D. Function eligibility automatically clears every individual.

Explanation

Correct answer A: Evaluate that individual before deciding permissible direct assistance.

Direct assistance has individual threat/competence evaluation. Revised SA 610 paragraph(s) 27-28.

AUD-G19-P019 · 2 marks

An assistant faces significant objectivity threats that cannot be adequately addressed. Other gates pass. Which decision is supported?

A. Do not use that individual for direct assistance. B. Use the person if confidentiality is signed. C. Assign significant judgment tasks to compensate for the threat. D. Use the person because the function overall is competent.

Explanation

Correct answer A: Do not use that individual for direct assistance.

Significant objectivity threats exclude direct assistance from that individual. Revised SA 610 paragraph(s) 28(a).

AUD-G19-P020 · 2 marks

Two permissible tasks differ in judgment, risk and staff competence. How should assignment extent and oversight be determined?

A. Consider all paragraph 29 factors, not identical oversight solely from staff titles. B. Ignore risk because tasks are permissible. C. Apply the same minimum review regardless of differences. D. Use only the number of employees available.

Explanation

Correct answer A: Consider all paragraph 29 factors, not identical oversight solely from staff titles.

Permissibility does not determine responsive direction/supervision/review. Revised SA 610 paragraph(s) 29.

AUD-G19-P021 · 2 marks

The partner proposes an eligible assistant to decide the final significant going-concern conclusion. Which is correct?

A. Allow it because the final page will be externally signed. B. Allow it if the entity signs a non-intervention promise. C. Do not assign the significant judgment as direct assistance. D. Allow it if the assistant has ten years' experience.

Explanation

Correct answer C: Do not assign the significant judgment as direct assistance.

Significant judgments are prohibited direct-assistance tasks. Revised SA 610 paragraph(s) 30(a),A19.

AUD-G19-P022 · 2 marks

At an assessed higher-risk assertion, the proposed task involves more than limited judgment. Which allocation is allowed?

A. Assign if a written confidentiality agreement exists. B. Assign because every high-risk task is automatically routine. C. Do not assign that task as direct assistance. D. Assign if the individual is competent.

Explanation

Correct answer C: Do not assign that task as direct assistance.

Paragraph 30(b) concerns higher risk combined with more than limited judgment. Revised SA 610 paragraph(s) 30(b).

AUD-G19-P023 · 2 marks

An internal auditor already reported warehouse tests through the function. The external team asks the same auditor to redo those tests as direct assistance. What is correct?

A. Existing work can never even be evaluated under the function-work route. B. External supervision automatically removes the prohibition. C. A different file name makes it unrelated work. D. This direct-assistance assignment falls within the own-function-work prohibition.

Explanation

Correct answer D: This direct-assistance assignment falls within the own-function-work prohibition.

Do not confuse prohibited direct assistance with separately evaluating existing function work. Revised SA 610 paragraph(s) 30(c).

AUD-G19-P024 · 2 marks

An assistant is asked to decide how much function work the external audit should use. What is correct?

A. The external auditor's use decision is not assignable as direct assistance. B. Assign because the assistant understands the function best. C. Assign if the partner promises to read the decision later. D. Assign if the decision lowers the audit fee.

Explanation

Correct answer A: The external auditor's use decision is not assignable as direct assistance.

Decisions regarding using function work/direct assistance remain external. Revised SA 610 paragraph(s) 30(d).

AUD-G19-P025 · 2 marks

Some function work and permissible direct assistance are planned together. Which safeguard applies?

A. A single mandatory percentage validates every audit. B. Assess whether combined use still leaves sufficient external involvement. C. Evaluate only direct assistance and ignore function-work extent. D. Combined use removes the need for direct external work.

Explanation

Correct answer B: Assess whether combined use still leaves sufficient external involvement.

Paragraph 32 expressly addresses aggregate combination. Revised SA 610 paragraph(s) 32.

AUD-G19-P026 · 2 marks

The proposed entity representative promises non-intervention verbally but offers no written agreement. Assistance has not started. What is required?

A. Replace it with the external auditor's own signed note. B. Obtain the authorised entity's required written agreement before using direct assistance. C. Begin because oral promises always satisfy paragraph 33. D. Use the function report as the entity agreement.

Explanation

Correct answer B: Obtain the authorised entity's required written agreement before using direct assistance.

The entity agreement covers following external instructions and non-intervention. Revised SA 610 paragraph(s) 33(a).

AUD-G19-P027 · 2 marks

The entity agreement is complete but individuals have signed no confidentiality/threat-notification agreement. What follows?

A. Entity agreement substitutes for all individual terms. B. A staff employment contract automatically proves both required terms. C. Initial objectivity means later threats need never be notified. D. Obtain the required individual written agreement before use.

Explanation

Correct answer D: Obtain the required individual written agreement before use.

Paragraph 33(b) requires confidentiality and objectivity-threat notification. Revised SA 610 paragraph(s) 33(b).

AUD-G19-P028 · 2 marks

Eligible assistants perform permitted tasks without external direction or supervision. The manager reads a final summary. Which is correct?

A. Signed agreements replace performance review. B. Direct assistance requires external direction, supervision and review responsive to the circumstances. C. Reading a one-line conclusion always satisfies every review obligation. D. Eligibility removes the need for all oversight.

Explanation

Correct answer B: Direct assistance requires external direction, supervision and review responsive to the circumstances.

The route is externally directed, supervised and reviewed. Revised SA 610 paragraph(s) 34.

AUD-G19-P029 · 2 marks

A reviewer checks summaries but none of the source audit evidence for direct-assistance work. What is needed?

A. Exactly three source items are mandated in every engagement. B. Review must include checking back to underlying evidence for some of the work. C. Reviewing every summary heading is automatically enough. D. Underlying evidence may never be reviewed externally.

Explanation

Correct answer B: Review must include checking back to underlying evidence for some of the work.

Paragraph 34(b) adds underlying-evidence review; there is no universal count. Revised SA 610 paragraph(s) 34(b).

AUD-G19-P030 · 2 marks

A direct-assistance file contains agreements and work papers but no reviewer/date/extent. Which is correct?

A. Agreements prove who reviewed every procedure. B. Required review particulars are missing; agreements alone are not a complete paragraph 37 record. C. Only the entity's payroll list is required. D. The missing information may be invented retrospectively.

Explanation

Correct answer B: Required review particulars are missing; agreements alone are not a complete paragraph 37 record.

Paragraph 37 includes review identity/date/extent plus other specified records. Revised SA 610 paragraph(s) 37.

Official concept links appear with each question. The source hold is included in the review pack. No blanket 2026 statutory completeness is claimed; supplied mandate/criteria and visible source holds apply.