Which of the following trends found on financial reports would most likely indicate a possible problem?

Which of the following recommendations made by the internal audit activity (IAA) is most likely to help prevent fraud?

A large retail organization, which sells most of its products online, experiences a computer hacking incident.
The chief IT officer immediately investigates the incident and concludes that the attempt was not successful.
The chief audit executive (CAE) learns of the attack in a casual conversation with an IT auditor. Which of the following actions should the CAE take?
1. Meet with the chief IT officer to discuss the report and control improvements that will be implemented as a result of the security breach, if any.
2. Immediately inform the chair of the audit committee of the security breach, because thus far only the chief IT officer is aware of the incident.
3. Meet with the IT auditor to develop an appropriate audit program to review the organization's Internet-based sales process and key controls.
4. Include the incident in the next quarterly report to the audit committee.

Which of the following is the correct ratio to use in calculating the dollar value of the population if the auditor is using ratio estimation?
Number of Items Audited Value Carrying Amount Sample
$500,000 $480,000 Population 3,000 $5,000,000

Which characteristic of risk assessment makes it a useful tool for audit planning?