Internal auditing is primarily concerned with:
A) Expressing an opinion on financial statements
B) Ensuring compliance with tax laws
C) Evaluating and improving internal controls and risk management
D) Preparing financial reports
External auditors are appointed by:
A) The company’s shareholders
B) The internal audit department
C) The finance manager
D) The IT department
Which of the following is NOT a key role of internal auditors?
A) Reviewing internal controls
B) Ensuring company policies are followed
C) Expressing an independent audit opinion
D) Evaluating risk management strategies
External auditors provide an opinion on:
A) Operational efficiency
B) Financial statement fairness
C) Employee performance
D) Corporate social responsibility
Which type of auditor is an employee of the organization?
A) External auditor
B) Government auditor
C) Internal auditor
D) Independent auditor
The primary objective of an external audit is to:
A) Detect fraud
B) Express an opinion on financial statements
C) Improve business efficiency
D) Implement internal controls
Which audit function focuses on compliance with internal policies and procedures?
A) External audit
B) Internal audit
C) Statutory audit
D) Tax audit
Internal auditors report directly to:
A) The CEO
B) The audit committee or board of directors
C) The shareholders
D) The tax authorities
External auditors must be:
A) Employees of the company
B) Independent of the organization
C) Hired by the internal audit team
D) Experts in operational management
Which of the following is a similarity between internal and external auditors?
A) Both provide independent financial statement opinions
B) Both assess internal controls
C) Both are hired by shareholders
D) Both focus on tax compliance
Which of the following is NOT a responsibility of an internal auditor?
A) Fraud detection and prevention
B) Financial statement certification
C) Reviewing operational efficiency
D) Assessing risk management policies
Which of these is a key difference between internal and external auditors?
A) External auditors work for management
B) Internal auditors express an opinion on financial statements
C) Internal auditors focus on improving business operations
D) External auditors review operational efficiency
Who is responsible for appointing external auditors?
A) Internal audit department
B) Company’s shareholders
C) Finance manager
D) IT department
What is the main focus of an external audit?
A) Corporate governance
B) Compliance with tax laws
C) Financial statement accuracy
D) Employee productivity
Internal audits are performed:
A) Once a year
B) Only when fraud is suspected
C) Continuously throughout the year
D) By government agencies only
External audits are conducted:
A) Once every five years
B) Monthly
C) Annually or as required by law
D) Only upon request of management
Which of the following is NOT a characteristic of an internal audit?
A) Ongoing review process
B) Focus on risk management
C) Independent financial statement opinion
D) Evaluation of internal controls
Internal auditors help management by:
A) Approving financial statements
B) Implementing new tax laws
C) Identifying and mitigating risks
D) Making external audit reports
Which of the following statements is true about external auditors?
A) They are part of the company’s management team
B) They report to the shareholders
C) They focus only on fraud detection
D) They operate without any reporting structure
An external auditor’s main duty is to:
A) Implement internal controls
B) Provide recommendations to management
C) Express an opinion on financial statements
D) Conduct operational audits
Which of the following is NOT an advantage of internal auditing?
A) Helps improve internal controls
B) Provides management insights
C) Ensures external audit independence
D) Identifies operational inefficiencies
External auditors issue:
A) Internal reports
B) Audit opinions on financial statements
C) Business strategy reports
D) Tax compliance reports
Internal auditors help improve:
A) Financial statement fairness
B) Operational effectiveness
C) Shareholder reports
D) Tax calculations
Which of the following reports is issued by external auditors?
A) Management report
B) Internal assessment report
C) Independent auditor’s report
D) Tax compliance report
External auditors must follow:
A) Company policies
B) Government regulations only
C) International auditing standards
D) Management’s instructions
Which of the following best describes the role of internal auditors?
A) Approving tax filings
B) Providing recommendations for improvement
C) Certifying financial statements
D) Preparing accounting records
Who benefits from an internal audit report?
A) External stakeholders
B) Shareholders
C) Management and board of directors
D) Government agencies
Which of the following is an example of an external audit?
A) Analyzing employee performance
B) Reviewing tax compliance
C) Issuing an independent audit opinion on financial statements
D) Monitoring operational efficiency
