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Question 1: The audit committee is concerned that the small size of the internal audit activity (IAA) makes
it impractical to achieve full conformance with the Standards. To address this concern,which of the
following actions is most appropriate for the CAE to take?
A. The CAE should agree with the audit committee and implement only those standards appropriate
to the size of the IAA.
B. The CAE should request the audit committee to review the Standards to identify specifically which
are creating the greatest concern.
C. The CAE should seek sufficient funding to increase audit resources to meet the minimum
requirements of the Standards.
D. The CAE should explain that conformance with the Standards is essential and not dependent upon
the size of the IAA.
Correct Answer: D
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