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  3. CIA-III

Financial CIA-III Exam (page: 1)
Financial The Certified Internal Auditor Part 3
Updated on: 31-Mar-2026

Viewing Page 1 of 312
CIA-III PDF 1554 Questions

A traditional quality control process in manufacturing consists of mass inspection of goods only at the end of a production process. A major deficiency of the traditional control process is that:

  1. It is expensive to do the inspections at the end of the process.
  2. It is not possible to rework defective items.
  3. It is not 100% effective.
  4. It does not focus on improving the entire production process.

Answer(s): A

Explanation:

The process used to produce the goods is not thoroughly reviewed and evaluated for efficiency and effectiveness. Preventing defects and increasing efficiency by improving the production process raises quality standards and decreases costs.



If a manufacturer has established a limit on the number of defects that are tolerable in the final assembly of its product, which of the following quality control procedures should be employed?

I). Inspect completed goods for compliance with established tolerances.
II). Review sales returns for defects not detected during the final inspection process.
III). Compare materials and machinery specifications with original product designs.
IV). Establish a quality circle that includes management and subordinates to discuss labor efficiency.

  1. I, III, and IV.
  2. II and III only.
  3. I, II, and III.
  4. Ill and IV only.

Answer(s): C

Explanation:

Inspecting goods after completion of the production process and counting defective goods returned by customers are product quality procedures. They measure the level of product conformance with customer expectations. Verifying materials and machinery specifications are process quality procedures because they emphasize the inputs to the process and the process itself.



The most important component of quality control is:

  1. Ensuring goods and services conform to the design specifications.
  2. Satisfying upper management.
  3. Conforming with ISO-9000 specifications.
  4. Determining the appropriate timing of inspections.

Answer(s): A

Explanation:

The intent of quality control is to ensure that goods and services conform to the design specifications.
Whether the focus is on feed forward, feedback, or concurrent control, the emphasis is on ensuring product or service conformity.



Management of a company is attempting to build a reputation as a world-class manufacturer of quality products.
Which of the following measures would not be used by the firm to measure quality?

  1. The percentage of shipments returned by customers because of poor quality.
  2. The number of parts shipped per day.
  3. The number of defective parts per million.
  4. The percentage of products passing quality tests the first time

Answer(s): B

Explanation:

The number of parts shipped per day would most likely be used as a measure of the effectiveness and efficiency of shipping procedures, not the quality of the product. This measure does not consider how many of the parts are defective.



Which of the following is not an appropriate measure of quality?

  1. Market share.
  2. Delivery performance.
  3. Customer satisfaction.
  4. Raw materials costs.

Answer(s): D

Explanation:

Emphasizing lower input costs may result in more defective output, and higher input costs may or may not reflect the procurement of better raw materials. Financial measures are thus mostly unsuitable for measuring quality.



Viewing Page 1 of 312



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