When identifying audit resource requirements, the chief audit executive (CAE) should consider approaching an external service provider to conduct internal audits in areas where the organization lacks the necessary skills (2). This ensures that audits are conducted by individuals with the appropriate expertise. Additionally, communicating to senior management a summary report on the status and adequacy of audit resources (4) keeps them informed about the internal audit activity's capacity and any resource constraints. Considering employees from other operational areas as audit resources (1) could compromise objectivity and independence, while suggesting deferral of audits (3) is generally not advisable as it might leave significant risks unaddressed. References: IIA Standard 2030 - Resource Management, IIA Practice Advisory 2030-1

Bank confirmations are the most reliable source for verifying the current year-end bank balances. These confirmations are direct responses from the bank to the auditor, providing independent verification of the account balances as of the end of the year. This external confirmation is considered more reliable than internal documents like bank statements, reconciliations, or general ledger balances because it comes directly from a third-party source, ensuring its accuracy and completeness.
The Institute of Internal Auditors (IIA) - Practice Guide: External Confirmations Auditing Standards (e.g., ISA 505 - External Confirmations)

In internal auditing, when assessing the accuracy and completeness of employee time reporting, auditors often use sampling to determine the overall compliance of the process. In this scenario, the internal auditor sampled
30 employee time reports and found 5 incorrect and 4 unsupported reports. This indicates that a majority (21 out of 30) were accurate, suggesting that the organization generally ensures accurate reporting. However, the presence of incorrect and unsupported reports indicates deficiencies that need to be addressed, but do not point to systemic fraud or abuse. Thus, option D accurately reflects the findings by acknowledging both the general accuracy and the instances of errors.
The Institute of Internal Auditors (IIA) - Standards for the Professional Practice of Internal Auditing COSO Framework - Control Activities and Monitoring

Internal control questionnaires (ICQs) are useful tools for internal auditors to guide interviews with auditees.
They help ensure that all relevant aspects of internal controls are covered systematically during the interview process. While ICQs can help in evaluating the design and existence of controls, they primarily provide a structured format for gathering information from auditees about controls in place, rather than serving as direct audit evidence themselves. Therefore, they aid in the interview process by ensuring comprehensive coverage of control-related inquiries.
The IIA's International Standards for the Professional Practice of Internal Auditing, Standard 2201 - Planning Considerations.

Comprehensive and Detailed Explanation:
Audit conclusions must be backed by sufficient, relevant, and reliable evidence (Standard 2330). In construction audits, the most reliable evidence of cost overruns and delays comes from payment records and milestone documentation (A), which clearly show the financial impact tied to project performance. While photos (B) may illustrate delays, they are not sufficient proof of cost impact. Sprint planning (C) is not relevant to construction projects and does not provide financial evidence. Internal rate of return (D) is a performance metric, not evidence of actual cost overruns. Therefore, the appropriate evidence for workpapers must be the payment and work milestone documents that support the $10 million loss conclusion.