CIA Question of the Day: Handling Suspected Illegal Acts

Quiz Yazan Ibrahim
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CIA exam practice question — CIA Question of the Day: Handling Suspected Illegal Acts

CIA exam practice question: daily practice for the Certified Internal Auditor (CIA) exam — domain: Part 2: Practice of Internal Auditing.

Question

During an operational audit of procurement, you discover a pattern of payments to a vendor that appear inconsistent with contract terms and may violate procurement law. What is the most appropriate immediate action for the internal auditor to take?

  • A. Immediately notify the external regulator about the suspected violation.
  • B. Confront the procurement staff member and accept their explanation if plausible.
  • C. Obtain additional corroborative evidence and discuss the findings with the chief audit executive and legal counsel.
  • D. Document the observations and include them only in the final report to the process owner.
Show the answer and explanation

Correct answer: C. Obtain additional corroborative evidence and discuss the findings with the chief audit executive and legal counsel.

The best immediate action is to obtain additional corroborative evidence and consult the chief audit executive (CAE) and legal counsel. This preserves evidence, ensures appropriate handling, and determines legal or regulatory reporting obligations. Immediately notifying external regulators is premature and could breach confidentiality or legal protocols without CAE/legal guidance. Confronting the staff and accepting an explanation risks contaminating evidence and lacks appropriate escalation. Limiting documentation to the process owner is insufficient when violations may be significant; the CAE and counsel must be involved to assess materiality, confidentiality, and required external notifications.

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