Certified Internal Auditor (CIA) Practice Test

When an internal auditor questions the business purposes of an officer's reimbursed travel expenses and the officer promises to not claim legitimate expenses in the future, what should the internal auditor do?

1. Ignore the original charging of the nonbusiness expenses.

2. Inform the tax authorities in any event.

3. Include the finding in the final engagement communication.

4. Recommend that the officer forfeit any frequent flyer miles received.

The correct answer is: Include the finding in the final engagement communication.

Including the finding in the final engagement communication is an important step for maintaining transparency and accountability in the auditing process. When an internal auditor identifies issues regarding the business purposes of an officer's reimbursed travel expenses, it is necessary to document this finding to ensure that it is recognized by management and appropriate actions can be taken moving forward. This documentation not only provides a record for future reference but also contributes to the integrity of the internal audit process. By including the finding in the final engagement communication, the auditor upholds the principle of ethical responsibility and supports the organization's governance and risk management practices. This ensures that stakeholders are aware of potential compliance issues and can take steps to mitigate risks associated with financial reporting and expense reimbursements. Furthermore, this action reinforces the auditor's role in promoting organizational improvements and proper financial management, ultimately safeguarding the entity's interests.