IIA Exam IIA-CRMA Topic 8 Question 74 Discussion

Actual exam question for IIA's IIA-CRMA exam

Question #: 74
Topic #: 8

When auditing the award of a major contract, which of the following should an internal auditor suspect as a red flag for a bidding fraud scheme?

1. Subsequent change orders increase requirements for low-bid items.

2. Material contract requirements are different on the actual contract than on the request for bids.

3. A high percentage of employees are charged to indirect accounts.

4. Losing bidders are hired as subcontractors.

A1 only

B2 only

C1 and 3.

D2 and 4.

Show Suggested Answer

Suggested Answer: B

by Rozella at Apr 13, 2024, 10:20 AM

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Dewitt

3 days ago

Hmm, the second option is also a good one. If the contract requirements don't match the bid documents, that's a major red flag. Someone's trying to pull a fast one.

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Mammie

5 days ago

Definitely. It's important to watch out for any suspicious activities during contract awards.

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Brandon

8 days ago

I agree with you, Brandon. That seems like a clear conflict of interest.

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Mammie

10 days ago

I think the red flag for bidding fraud could be losing bidders being hired as subcontractors.

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Sarah

10 days ago

Ah, I see what they're getting at. The first option seems like a pretty obvious red flag for a bidding fraud scheme. Sneaky contractors trying to inflate their profits, eh?

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