Advanced-CAMS-Audit Sample Questions & Answers
Fieldwork and evaluation of how well AML programs are designed and operating carries the most weight, ahead of audit planning and scoping, corporate governance over the audit function itself, and reporting findings with follow-up recommendations.
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- Question 1Intermediate
Corporate Governance and the Audit Function · Outsourced function oversight
A global bank has outsourced its primary Level 1 transaction monitoring alert review to a third-party vendor in a different jurisdiction. As the internal AML auditor, what is the MOST critical governance document you must review to ensure adequate oversight?
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Correct answer: D
The SLA is the foundational governance document for outsourcing. It must specify performance metrics (quality/timeliness), the specific AML responsibilities, and crucially, the bank's 'right to audit' the vendor. Without this, the bank cannot assure the regulator that the outsourced function is compliant.
- Question 2Advanced
Corporate Governance and the Audit Function · Emerging risks, CAATs, and continuous monitoring
When planning an audit of a newly implemented Artificial Intelligence (AI) transaction monitoring system, which of the following is the PRIMARY risk associated with the 'Black Box' nature of such systems that the auditor must address?
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Correct answer: C
The 'Black Box' problem refers to the difficulty in explaining the internal decision-making logic of complex AI/ML models. For AML audit and regulatory purposes, 'explainability' is critical to demonstrate why a customer was flagged or not flagged. If the model's logic cannot be interpreted, its effectiveness cannot be validated.
- Question 3Beginner
Corporate Governance and the Audit Function · Roles and responsibilities of the third line of defense
True or False: In the context of the Three Lines of Defense model, the Internal Audit function (Third Line) is responsible for designing and implementing the controls that mitigate AML risks.
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Correct answer: B
False. The First Line (Business) and Second Line (Compliance) are responsible for designing and implementing controls. The Third Line (Internal Audit) provides independent assurance on the effectiveness of those controls but does not design or implement them to maintain independence.
- Question 4Intermediate
Corporate Governance and the Audit Function · Emerging risks, CAATs, and continuous monitoring
You are auditing the data integrity of an AML transaction monitoring system. You decide to use Computer Assisted Audit Technologies (CAATs) to verify that all transactions from the core banking system are accurately flowing into the monitoring tool. Which CAATs procedure is MOST appropriate for this objective?
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Correct answer: C
To verify that all transactions flowed from Source (Core Banking) to Target (Monitoring Tool), a completeness check is required. This involves comparing record counts and control totals (e.g., sum of transaction values) to ensure 100% data ingestion (Data Lineage validation).
- Question 5Intermediate
Corporate Governance and the Audit Function · Audit triggers, stages, and approaches
Which of the following scenarios describes a 'Thematic Review' audit approach rather than a 'Vertical' or 'Horizontal' review?
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Correct answer: C
A Thematic Review (or Horizontal Review) looks at a specific risk or control topic (e.g., Sanctions Screening) across multiple business lines or the entire organization to assess consistency and systemic effectiveness.
- Question 6Intermediate
Corporate Governance and the Audit Function · International bodies and key AML audit documents
The Wolfsberg Group Statement on the Internal Audit of the AML/CTF Program suggests that the frequency of the AML audit should be determined primarily by:
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Correct answer: D
The Wolfsberg Statement emphasizes that the frequency and scope of AML audits should be risk-based, driven by the institution's risk profile (products, customers, geographies) and the outcomes of its risk assessments, rather than a fixed arbitrary schedule.
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