CIA-III Exam dumps PDF | Exam-Dumps (Page: 32)

QUESTION: 156 Exam Topic: 1, Volume A

In which of the following organizational structures does total quality management TOM) work best?

Hierarchal.
Teams of people from the same specialty.
Teams of people from different specialties.
Specialists working individually.

Answer(s): C

Explanation:

TOM advocates replacement of the traditional hierarchal structure with teams of people from different specialties. This change follows from TQM's emphasis on empowering employees and teamwork. Employees should have proper training, necessary information, and the best tools; be fully engaged in the decision process; and receive fair compensation. If such empowered employees are assembled in teams of individuals with the required skills, TOM theorists believe they will be more effective than people performing their tasks separately in a rigid structure.

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QUESTION: 157 Exam Topic: 1, Volume A

The most important component of quality control is:

Ensuring goods and services conform to the design specifications.
Satisfying upper management.
Conforming with ISO-9000 specifications.
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.

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QUESTION: 158 Exam Topic: 1, Volume A

The cost of scrap, rework, and tooling changes in a product quality cost system is categorized as a n)

Training cost.
External failure cost.
Internal failure cost.
Prevention cost.

Answer(s): C

Explanation:

Internal failure costs are incurred when detection of defective products occurs before shipment. Examples of internal failure costs are scrap, rework, tooling changes, and downtime.

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QUESTION: 159 Exam Topic: 1, Volume A

The four categories of costs associated with product quality costs are:

External failure, internal failure, prevention, and carrying.
External failure, internal failure, prevention, and appraisal.
External failure, internal failure, training, and appraisal.
Warranty, product liability, training, and appraisal.

Answer(s): B

Explanation:

The following are the four categories of quality costs: prevention, appraisal, internal failure, and external failure lost opportunity). Costs of prevention include attempts to avoid defective output, including employee training, review of equipment design, preventive maintenance, and evaluation of suppliers. Appraisal costs include quality control programs, inspection, and testing. Internal failure costs are incurred when detection of defective products occurs before shipment, including scrap, rework, tooling changes, and downtime.
External failure costs are incurred after the product has been shipped, including the costs associated with warranties, product liability, and customer ill will.

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QUESTION: 160 Exam Topic: 1, Volume A

The cost of statistical quality control in a product quality cost system is categorized as a n)

Internal failure cost.
Training cost.
External failure cost.
Appraisal cost.

Answer(s): D

Explanation:

The following are the four categories of quality costs: prevention, appraisal, internal failure, and external failure lost opportunity). Appraisal costs include quality control programs, inspection, and testing. However, some authorities regard statistical quality and process control as preventive activities because they not only detect faulty work but also allow for adjustment of processes to avoid future defects.

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Financial CIA-III Exam (page: 32) Financial The Certified Internal Auditor Part 3 Updated on: 16-Feb-2026

QUESTION: 156 Exam Topic: 1, Volume A

Explanation:

QUESTION: 157 Exam Topic: 1, Volume A

Explanation:

QUESTION: 158 Exam Topic: 1, Volume A

Explanation:

QUESTION: 159 Exam Topic: 1, Volume A

Explanation:

QUESTION: 160 Exam Topic: 1, Volume A

Explanation:

Financial CIA-III Exam (page: 32)
Financial The Certified Internal Auditor Part 3
Updated on: 16-Feb-2026