Certified Government Auditing Professional (CGAP) Practice Exam

What type of audit would be indicated by steps including determining average processing time and comparing revenues to costs?

1. An efficiency audit.

2. A financial statement audit.

3. A quality audit.

4. Integrity services.

The correct answer is: An efficiency audit.

An efficiency audit focuses on evaluating an organization's operations to ascertain how effectively resources are being utilized to achieve the desired outcomes. In this case, steps such as determining average processing time and comparing revenues to costs are integral to assessing efficiency. By analyzing processing times, the audit seeks to identify areas where improvements can be made, thereby optimizing the workflow or service delivery process. Additionally, comparing revenues to costs allows the audit to determine whether the organization is achieving value relative to its expenditures, further contributing to efficiency assessments. The other types of audits mentioned do not align with the steps outlined in the question. A financial statement audit typically deals with the accuracy and completeness of financial records, rather than the operational effectiveness. A quality audit focuses on adherence to quality standards and processes, whereas integrity services relate to the ethical conduct and compliance within the organization. Thus, the emphasis on processing time and cost-revenue comparison distinctly points to an efficiency audit as the applicable type in this scenario.