Certified Internal Auditor (CIA) Practice Test

What is the role of an internal auditor in terms of managing variances with engagement clients?

1. To overlook discrepancies during engagements

2. To emphasize findings correlate with previous analysis

3. To pursue full investigations even when unnecessary

4. To ensure all findings are understood and addressed

The correct answer is: To ensure all findings are understood and addressed

The role of an internal auditor in managing variances with engagement clients focuses primarily on communication and resolution of the findings from audits. Ensuring that all findings are understood and addressed is fundamental to the internal auditor's responsibilities. This involves not just identifying discrepancies in data or processes, but also facilitating discussions with the engagement clients to clarify the implications of those findings and to ensure that appropriate corrective actions are taken. By doing so, the internal auditor adds value to the organization, as they help clients understand the reasons behind the variances, the risks associated with them, and the necessary steps that should be taken to mitigate those risks. This collaborative approach fosters better relationships between auditors and clients, encourages accountability, and promotes continuous improvement within the organization. In contrast, overlooking discrepancies would undermine the internal audit's purpose. Emphasizing findings that correlate with previous analyses could lead to repetitive conclusions without addressing new issues. Pursuing full investigations unnecessarily could waste resources and time, diverting attention from essential matters that require resolution. Thus, the focus on effective communication and resolution of findings is what sets apart the role of the internal auditor in managing variances.