Internal audit is an independent appraisal activity
x
Internal audit is separate from the organisation's internal control system
x
Internal audit is carried out solely for the benefit of the organisation's stakeholders
x
The internal audit function reports to the finance director
x
Rationale: Internal audit is independent, but is still part of the internal control system: it is a control which examines and evaluates the adequacy and efficacy of other controls. Internal auditors should report direct to the audit committee of the board of directors (in order to preserve independence). It is external audit which is for the benefit of shareholders: internal audit is a service to management.
Ways in: Once you realised that the options were circling round different aspects of the definition of internal audit, and the difference between internal and external audit, you would be better able to sort out which statement was given to you 'straight' - and which were opposites of the true points.
