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      Question

      Which of the following is a limitation of an Internal

      Audit?
      A It is not independent Correct Answer Incorrect Answer
      B It does not review internal controls Correct Answer Incorrect Answer
      C Its scope is determined by management Correct Answer Incorrect Answer
      D It is not conducted by qualified professionals Correct Answer Incorrect Answer
      E It is not a continuous process Correct Answer Incorrect Answer

      Solution

      A key limitation of internal audit is that its scope, mandate, and depth of review are determined by the management and the audit committee. This can potentially restrict its ability to examine all areas it might wish to, unlike a statutory auditor whose scope is largely defined by law and standards.

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